The United Nations Conference on Trade and Development (UNCTAD) has called for stronger international cooperation to protect global trade, following its Review of Maritime Transport 2024. The report highlights key challenges, including strained supply chains, disruptions in major maritime routes, and fraudulent ship registrations.
Rising Costs and Supply Chain Strain
Shipping costs surged in early 2024 due to disruptions along key routes and higher operational expenses. Freight rates spiked as vessels were rerouted and ports faced congestion. The Shanghai Containerized Freight Index (SCFI) more than doubled from late 2023, though it later dropped by 45%. However, it remains 115% above pre-pandemic levels.
UNCTAD calls for urgent action to stabilise freight markets and support vulnerable economies. It recommends increasing port efficiency, investing in low-carbon shipping, strengthening international cooperation, and diversifying trade routes.
Global Trade Disruptions
The Suez and Panama Canals face severe challenges due to geopolitical tensions and climate-related risks, disrupting trade, increasing costs, and threatening food security in vulnerable economies. Rerouted vessels have led to port congestion, higher fuel consumption, and increased piracy risks. Global ton-miles rose by 4.2% in 2023, putting additional strain on supply chains.
UNCTAD urges swift action to address these chokepoint vulnerabilities, recommending stronger monitoring systems, investment in resilient infrastructure, and support for regional trade initiatives.
Challenges at Maritime Chokepoints
Global maritime trade grew by 2.4% in 2023, but vulnerabilities remain. Cargo rerouting around the Cape of Good Hope surged by 89%, adding to costs and carbon emissions. The report highlights the need for resilience in the maritime industry to cope with climate change impacts, as extreme weather events increasingly disrupt operations.
UNCTAD also raises concerns about the rise in fraudulent ship registrations, undermining safety, security, and pollution control.
Call for Global Cooperation
UNCTAD calls for increased investment in green shipping, international collaboration to address chokepoint disruptions, and efforts to combat fraudulent ship registrations. Coordinated action is essential to safeguard global trade and ensure the resilience of maritime transport systems.
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