- Baltic-ICS Member Lectures return in November
The Baltic Exchange and Institute of Chartered Shipbrokers (ICS) will be presenting the second in their series of lunchtime lectures on 28 November in Singapore, Shanghai, Athens and London.
Intended to support and develop brokers and operations professionals, the series will examine topical issues facing those working in chartering and operations roles, offering advice on best practice in critical situations and insight into the changing patterns affecting the shipping sector.
This second lecture will focus on charterparty pitfalls and how to avoid them.
This event is free to Baltic and ICS member companies. Those interested must register by email to email@example.com (reference: BXICS202).
For more details, click here.
- Remembrance Day Service
Members and friends are invited to attend the Baltic Exchange on 9 November for this year’s Remembrance Day service. Those interested are invited to join us from 1045.
The Service takes place at the War Memorial in the lobby area. Coffee and biscuits from 1030 for 1045 service.
Royal British Legion poppies will be available in the Foyer and in the Bar.
Please contact Nick Pentreath if you are able to help with the following:
- The ‘Street Collection’ for the Poppy Appeal (25 Oct-9 Nov) in or near St. Mary Axe before work or at lunchtime –This would add greatly to our collection total
- If anyone plays brass/wind instrument (Grade 2/3) or drums/percussion and would like to join the band for the service
Corporate donations to The Poppy Appeal most welcome.
ACCOUNT: RBL POPPY APPEAL
SORT CODE: 30 11 75 (Lloyds)
ACCOUNT NUMBER: 01937121
Nick Pentrweath, Capricorn Shipbroking
Tel. 0207 283 7975
- Top maritime countries revealed
China, including Hong Kong, is the world’s top maritime nation according to a new report from DNV GL and Menon Economics.
The Asian superpower comes top for both ‘Shipping’ and ‘Ports & Logistics’ — two of the four main pillars in the study, the other two being ‘Maritime Finance & Law’ and ‘Maritime Technology’. The US follows behind in second place overall, with Japan coming third overall and Germany, Norway and South Korea tied in fourth place. Greece comes seventh overall, the UK comes eighth, Singapore ninth and Denmark 13th.
Diving into detail
Previously, Menon Economics and DNV GL had examined the competitiveness and performance of maritime cities, and the companies plan to continue publishing reports ranking the world’s top maritime capitals. However, according to the authors of this new report, entitled The Leading Maritime Nations of the World 2018, this year the two companies chose to focus on the maritime industries of entire countries for two main reasons.
“Firstly, many countries have strong local clusters that are mutually dependent,” the study explains. “In Norway for example, the technological centre is in Trondheim, the deep-sea centre in Bergen, the offshore centre in Ålesund and the finance centre in Oslo. The US has various local centres spread out across the country, with New York being a home to ship finance and law, Houston … an offshore capital, a shipping hub in Seattle/Tacoma and the major portion of the ports and logistics activities centred around the LA/Long Beach area. Secondly, the political and institutional framework is mainly on the national, not on the city, level.”
The presence of several small, high income economies among the top 10 leading maritime nations indicates the importance of policy measures and public institutions
Thirty countries were included in the study, with Hong Kong included within China in the report. According to Menon Economics and DNV GL, all have robust positions as maritime nations across different factors to varying degrees. Each country was ranked according to size and magnitude on all of the four main document pillars and sub-groups within these pillars. The Shipping pillar was given greater weight in the calculations due to it “being the main engine of the entire maritime industry”.
The document’s authors say that China’s particularly robust position within ‘Shipping’ and ‘Ports & Logistics’ mirrors “its position as a global manufacturing hub”. They note that Singapore manages to get a top 10 position “as a small and young nation” and that “Norway and South Korea’s top rankings reveal that smaller, high income countries that place significant investment in research and development, focusing on technology, innovation and engineering capabilities for the entire marine shipbuilding ecosystem, could propel themselves into the top five”. The ranking of Greece, they claim, “shows that even smaller countries can still have significant influence and importance on a global scale”, with the nation in seventh position “due to its shipping business acumen and traditions”.
The US emerges top within the ‘Maritime Finance & Law’ pillar. The nation is followed, in order, by Norway, the UK, China and Japan. Within ‘Shipping’, Greece comes second after China (which is in the top spot), Japan comes third and the US comes fourth, with Germany ranked fifth. Meanwhile, as regards ‘Ports & Logistics’, the US comes second after China, while Singapore, the UAE and Germany come third, fourth and fifth respectively. Finally, within the ‘Maritime Technology’ category, South Korea comes first. Japan comes second, China comes third and Germany comes fourth. Fifth place goes to the US.
Commenting on the overall findings, the authors say: “The results are an indication of the overall development in a country over several decades, and to some extent mirror the economic growth and size of a nation’s economy. The presence of several small, high income economies among the top 10 leading maritime nations indicates the importance of policy measures and public institutions, including high investment in research and development, innovation and tertiary education focusing on the maritime sector at a national level. In our view, the leading position of these smaller nations is the most interesting finding of the study, considering that it would be natural to expect large, developed nations to be ranked at the top in correlation with the size of their national economy.” The authors also say that they perceive a strong correlation between a country’s success and GDP contribution, job generation and profits, noting that as more individuals are employed, more profits are created, organically generating other benefits for a country.
The authors also discuss the difference between the results of the new study and those of The Leading Maritime Capitals of the World 2017. They give the example of Singapore, which comes first overall in the latter and ninth in the former. The main reason for the difference, they claim, is Singapore’s status as a city-state — China and the US, on the other hand, are economic superpowers with a number of maritime centres. However, the authors also say that removing the ‘Attractiveness & Competitiveness’ area as a standalone pillar is another factor making the maritime nations report ranking different from that of the maritime capitals study — Singapore would have ranked higher had it been included standalone in the maritime nations ranking.
“Hence, the two benchmarks tell different stories — both true and important, but different,” the authors conclude.
The Baltic Exchange’s next Shipping Economics & Investment course will take place on January 14 and 15 in London. More information can be found here.
- China’s trade pledges: empty promises?
This week is an important one for China. Monday marked the start of the first ever China International Import Expo, a six-day trade fair in Shanghai that has been described as a combination of “country exhibitions, company exhibitions and forums to promote free trade and an open global economy”. In a keynote speech at the exhibition, Chinese President Xi Jinping said that the event “demonstrates China’s consistent position of supporting the multilateral trading system and promoting free trade” and “is a concrete action by China to advance an open world economy and support economic globalisation”.
However, it is not only the expo itself that is significant. President Xi’s address served as an opportunity for the leader of the world’s most populous nation to make the case for his country’s commitment to opening up its economy.
China, according to the President, is set to “unswervingly follow a win-win strategy of opening-up” and “adopt high-quality policies to advance trade and investment liberalisation and facilitation”. To achieve this the country will, he explained, step up efforts in five areas. It will “stimulate the potential for increased imports”, “continue to broaden market access” and “foster a world-class business environment”. Additionally, it will “explore new horizons of opening-up” and “promote international cooperation at multilateral and bilateral levels”.
“We will take further steps to lower tariffs, facilitate customs clearance, reduce institutional costs in import and step up cross-border e-commerce and other new forms and models of business,” President Xi said in a statement sure to be of interest to economists given the trade war that has been waged of late between the East Asian nation and the second-biggest export economy globally, the US. While discussing the second area, he claimed that in the coming decade and a half, China’s import of goods and services is expected to exceed $30tr and $10tr respectively.
The speech was also a chance for President Xi to deliver a message to the world. Noting the current resurgence of unilateralism and protectionism, he spoke of how “economic globalisation faces headwinds” and how multilateralism and the system of free trade are under threat. Openness and co-operation are needed to foster steady world recovery, he argued, claiming that these two concepts will stay vital for continued human progress. He added that it is important for every nation to “open wider and expand the space for mutually beneficial co-operation” and “pursue innovative growth and speed up the transformation of growth drivers” as well as “pursue inclusive development for the benefit of all”.
We will take further steps to lower tariffs
In a pointed barb at protectionism and a ‘Me First’ attitude to trade, President Xi argued that “efforts to reduce tariff barriers and open wider will lead to interconnectivity in economic co-operation and global trade, while the practices of beggaring thy neighbour, isolation and seclusion will only result in trade stagnation and an unhealthy world economy”.
Analysing the address
Analysts, unsurprisingly, have pored over the details of President Xi’s address. According to Bloomberg, the President’s goods and services import prediction is “in line with China’s previous pledges on opening its economy and fostering consumption”, though “the pledge on goods imports is higher than a promise President Xi previously made, to buy $24tr”. However, Bloomberg claims that the comment doesn’t “move the needle very far on trade policy — the government has already cut tariffs this year and said it would do so again”.
“The big-ticket import pledge is actually not that much more than China is doing already,” it added. “President Xi didn’t announce any new stimulus measures, despite signalling last week that further measures were oncoming as the economy slows.”
Meanwhile, Marex Spectron analyst Alastair Munro said in a note: “[President Xi’s] reiteration of plans to further cut taxes [and] import $30tr of goods over the next 15 years, coupled with a distinct lack of details around any further stimulus measures, leaves the market disappointed.”
“President Xi pledged lower import tariffs and moves to make it easier for foreign firms to access the economy,” added Robin Brant from BBC News. “But, as is often the case, it lacked specific timings. He also didn’t address the core US complaints about Chinese trade, including the alleged theft of intellectual property from US firms and the special terms China gives to its state-run companies. There was definitely no sign that China is about to cave in the escalating trade war.”
Trade war remains
So far in 2018, around 50% of imports from China into the US have been slapped with tariffs, with the North American nation threatening to target all imports. According to the White House, the taxes are in response to China’s “unfair” trade policies – which US President Donald Trump blames for helping generate a massive trade deficit — and alleged intellectual property theft. The US administration also wants American companies to be given better access to China’s markets by the nation.
At the start of November, President Trump said on Twitter that himself and President Xi had had a “very good” phone conversation and that trade discussions with China were progressing “nicely”. He also said that he planned to meet President Xi on the sidelines of a G20 summit in Argentina, though this was soon upgraded to a “meeting plus dinner” at the request of President Trump, which China has tentatively agreed to, according to the South China Morning Post. Also at the beginning of the month, President Trump had reportedly asked US officials to prepare a draft trade deal with China, though three senior administration officials soon said that there was no indication of an imminent trade deal, despite some progress behind the scenes. Later, President Trump’s economic advisor Larry Kudlow said that the President had not asked his Cabinet to put together the agreement.
Given that progress with the US appears on shaky ground, it’s perhaps no surprise that in his trade expo speech, President Xi said that China would accelerate negotiations on both a China–EU investment deal as well as a regional free trade deal for China, Japan and South Korea.
The Baltic Exchange’s next Shipping Economics & Investment course will be held on January 14 and 15 in London. More information can be found here.
- Member update: 07 November
The following individuals have applied for Membership under an existing member company:
Individual Company Mr C Mosebach BACA – The Baltic Air Charter Association Mr Mark East JERA Trading Singapore Pte Ltd Mr L A Banks Mr A Petrou Vitol SA Mr T J Bowsher West of England Ship Owners Mutual Insurance Assoc. (Luxembourg) Ms S Byrne Mr N Paulson
Any comments should be passed to Karen Karanicholas by 14 November 2018.
- Baltic Caledonia: St Andrew’s Day Lunch
The Baltic Caledonia Society would like to invite members and guests to its St Andrew’s Day (30 November) lunch at the London Scottish Regiment HQ.
Starting at 12.15pm, the lunch will run all afternoon with guest speaker Will Allen in attendance in addition to the customary piper.
Tickets are £95 per person which includes one bottle of wine and large quantities of smoked salmon, haggis, neeps and tatties as well as a selection of Scottish Cheeses.
A charity draw will take place before proceedings come to a close at around 6pm.
Pictures from the Baltic Caledonia St Andrew’s Day lunch 2016, can be found here.
For more information and to book, contact Mike Robson.