The United Nations Office at Geneva
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UNCTAD Press conference 22 October 2024
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REVIEW OF MARITIME TRANSPORT 2024 – LAUNCH IN GENEVA
UN Trade and Development (UNCTAD) launched today the Review of Maritime Transport 2024: Navigating maritime chokepoints, which addresses critical vulnerabilities in global maritime routes, including the Suez and Panama canals.
DESCRIPTION
STORY: UNCTAD / Review of Maritime Transport
TRT: 02:55
SOURCE: UNCTAD
RESTRICTIONS: NONE
LANGUAGE: ENGLISH / NATS
WEBSITE: https://unctad.org/rmt2024
DATELINE: 22 OCTOBER 2024, GENEVA, SWITZERLAND
SHOTLIST
1. Wide shot, speakers at the podium of the press conference; speaker on screens, photographer taking pictures
2. SOUNDBITE (English) Shamika Sirimanne, UN Trade and Development, Director of Technology and Logistics: « We project maritime trade to grow at an average annual rate of 2.4% in the medium term. This is between 2025 and 2029, and containerized trade to increase by 2.7% in the medium term. Now, we believe that this growth to be supported by technological advancements, the transition to cleaner energy and renewed interest in investing in maritime and trade infrastructure. »
3. Medium shot, speakers on the podium; speaker on the screens; Photographer taking pictures.
4. SOUNDBITE (English) Shamika Sirimanne, UN Trade and Development, Director of Technology and Logistics: « The downside risks loom high for this medium-term projection. The geopolitical upheavals, unrelenting conflicts and wars never, never bode well for international trade. Rising protectionism and the resultant trade restrictions are on the rise. »
5. Medium shot, journalists in the press room; speaker on screen
6. SOUNDBITE (English) Shamika Sirimanne, UN Trade and Development, Director of Technology and Logistics: « And many low-income countries are faced with rising debt burdens, elevated borrowing cost and and they are unable to face further external shocks. You see, when the future is uncertain or the future is very uncertain as consumers us, what we do first is to tighten belts and we don't spend and invest, just go into the wait and see mode. »
7. Med shot, journalists in the press room
8. SOUNDBITE (English) Shamika Sirimanne, UN Trade and Development, Director of Technology and Logistics: « maritime choke points in several places have been acting up. The result is significant pressure on global logistics and strained supply chains. »
9. Wide shot, speakers at the podium of the press conference; speaker on screens, photographer taking pictures
10. SOUNDBITE (English) Shamika Sirimanne, UN Trade and Development, Director of Technology and Logistics: « By mid 2024, container freight rates more than doubled compared to the end 2023. And also red sea disruption has had significant impact on container rates. While rates have gone down in recent months. They are far above the rates observed prior to the Covid 19 pandemic, and this is a very big concern. And most importantly, high and volatile freight rates and the uncertainty they bring to the cost of doing business on a significant deterrent for international trade. »
11. Medium shot, speaker on the screens; journalist in the room; Photographer taking pictures.
12. SOUNDBITE (English) Shamika Sirimanne, UN Trade and Development, Director of Technology and Logistics: « Who bears the cost? So, when maritime chokepoints act up, small island developing states and least developed countries are hit the hardest in terms of rising price levels of food and other essential goods. »
13. Medium shot, speaker on the screens; Photographer taking pictures.
14. Medium shot, journalist in the room.
15. Photographer taking pictures in the room.
STORYLINE
Global maritime trade grew by 2.4% in 2023, recovering from a 2022 contraction, but the recovery remains fragile.
Key chokepoints like the Suez and Panama Canals are increasingly vulnerable to geopolitical tensions, conflicts and climate change.
These disruptions are extending shipping routes, straining supply chains and raising costs, with profound impacts on food security, energy supplies and the global economy, as over 80% of world trade volume is carried by sea.
Vulnerable economies, especially small island developing States and least developed countries, are hit hardest by rising shipping costs from rerouted vessels.
The Review of Maritime Transport 2024 highlights these challenges, calling for urgent action to strengthen industry resilience, accelerate decarbonization and support vulnerable economies.
It underscores the need for new infrastructure that is sustainable and resilient, a faster transition to low-carbon shipping and a crackdown on fraudulent ship registrations to safeguard global trade.
Production date: 22 October 2024
Creator: UNCTAD
Subject topical: ECONOMICS
Corporate name: UN TRADE AND DEVELOPMENT – UNCTAD
Teleprompter
good afternoon, everyone and thank you for joining us
today for the launch of
the Review of Maritime Transport 2024 by UN Trade
and Development. As you know,
this report is a key reference for anyone concerned
with global trade
and its future in the face, especially of current disruptions which
has been covering
over the past period,
especially the importance of maritime transport in sustaining global trade,
particularly for developing countries. According to
A's mandate
with us today,
we have Ms
Shamika
Sim Man.
She's director of
a
division on technology
and logistics,
and we have also
our colleague Jan Hofmann,
who was lead on the maritime transport he's been doing for many, many years now.
Navigating
maritime chokepoints is this year's title touching on
key issues that matter to all of us
trade,
development and resilience
in the face of new challenges.
Ms.
Iman
will take us through these findings,
highlighting the importance of maritime trade
as a lifeline for economies, especially
in vulnerable regions. Afterwards, we will open
the floor for questions from both the room and for those connected
online
to either the director, of course,
to our colleague Ian Hoffman. Thank you very much.
The director of the floor is yours.
Thank you so much, Marcelo.
And good day to all of you who are here. Good afternoon and joining from elsewhere.
A good day
to all of you.
So let me put to you three key points.
First is the macroeconomic outlook on maritime
trade.
We expect a modest 2% growth for 2024 driven
by demand for bulk commodities like iron ore,
coal and grain
and also as a result of container trade picking up from basically an
abysmal growth of 0.3% in 2023 to a robust growth of 3.5 in 2024.
Now
this projection for 2024 is very much in line
with the trends in the world economy stable, slow and resilient.
Global growth predicted at around 3.23 0.4%
for this year
and some easing of inflationary pressures in major economies.
Now going forward,
we project maritime trade to grow at an average annual rate of 2.4%.
In the medium term,
this is between 2025 and 2029
and containerized trade to increase by 2.7%
in the medium term.
Now we believe that this growth to be supported by technological advancements,
the transition to cleaner energy and renewed interest
in investing in maritime
and trade infrastructure
I'm talking about.
There's a lot of interest in smart and green ports
and improving hinterland connectivity
and digitalization of processes, trade and transport processes.
And here is the bad news.
The downside risk loom high for this medium term projection.
You see the geopolitical upheavals, unrelenting conflicts and wars never,
never bode well for international trade.
Rising protectionism and the result and trade restrictions are on the rise.
Elections are taking place or have just taken place
in some of the major economies around the world.
So we have to watch out for the policy directions of incoming administrations.
And many low income countries are faced with rising debt burdens,
elevated borrowing cost
and
and they are unable to face further external shocks.
You see when the future is uncertain or the future is very uncertain as consumers us.
What we do first is the tight and belts,
and we don't spend
and investors go into the wait and see mode,
and as a result, economy suffer an international trade with it.
So that's so.
In essence, the downside risk for the medium term projections are very high.
Now, my second point,
and also the theme of the report about the maritime chokepoints
these maritime choke points in several places have been acting up.
The result is significant pressure on
global logistics and strained supply chains.
The question is, Is this the new normal?
And if it's the new normal, what do we do? How do we prepare
now? I think many of you know maritime chokepoints are critical points
along transport routes
with limited alternative routes.
Take the Suez Canal, for example.
About 10% of world maritime trade by volume
and 22% of containerized trade cross the Suez
Canal annually.
Now the traffic through the Panama and Suez canals dropped
by over 50% by mid 2024 compared to their peaks
in late 2023. Like the I'm sorry, the mid 2023 they had peaks
and compared to that mid 2024 50%
drop.
Climate induced low water levels in the Panama Canal on the one hand,
and the outbreak of conflict
in the red sea region
and affecting the Suez
Canal,
for example. I think we have said in our report, cargo rerouting
around Africa surged massively,
with ship capacity arrivals increasing by almost 90%.
Now the result.
The result of all this
choke points acting up is longer routes,
port congestion,
higher fuel consumption, higher wages
of crude, higher freight rates and rising insurance premiums. And the list goes on.
So let me
focus on a couple of those things.
Maritime trade in 10 miles is on the rise. I think we have charts in our reports.
Look at the page two of the overview. We have a figure
showing that this
10
miles trade is up,
but by mid 2024
routing vessels
had increased container ship demand by 12 per cent.
This is mostly due to the Red Sea situation
and but
by mid 2024 container freight rates more than doubled compared to the end 2023.
And also Red Sea disruption has had a significant impact on container rates.
While rates have gone down in recent months,
they are far above the rates observed prior to the COVID-19 pandemic.
And this is a very big concern
and most importantly, high and volatile freight rates
and the uncertainty they bring to the
cost of doing business are a significant deterrent
for international trade,
and the small traders and developing countries are the most affected.
So anything to do with high and volatile anything is not good.
And then on congestion.
The port hubs like Singapore, the major Mediterranean ports, the
those in Africa were under pressure and also because of the demand for trans
trans
shipment
and on emissions, they went up.
We have an example in the press release saying that
when diverting around Africa instead of using the Suez Canal,
a typical big container ship on the Far East Europe trade route
adds $400,000
in
emission cost per voyage. So that's the situation
now the third point
who bears the cost.
So when maritime checkpoints act up,
small island developing states and least developed countries are hit the hardest
in terms of rising price levels of food
and other essential goods,
and we have done calculations to show how hard they have been hit.
Now, the small island developing stairs
also rely heavily on shipping for essential imports,
but their maritime connectivity has declined by 9% on average over the past decade,
making their isolation more pronounced.
And this is a concern.
So what do we do
in our report? We put an enormous amount of emphasis to building.
Resilient to a wide ranging disruptions is urgently needed
because we are in a disruption. Disruption is the new normal.
We have provided a specific set of recommendations. Let me give you few of them.
We say strengthen international co-operation and enhance
monitoring systems to stabilise trade routes,
provide early warning and enable rapid efficient
rerouting of vessels.
Diversify shipping routes and support regional trade
initiatives to reduce dependency on long distance routes
and boost intra regional trade flows that's more resilient.
Invest urgently
in resilient infrastructure at key chalk points
to minimise the impact of climate risks and conflicts.
Address the emerging new issues in the maritime landscape,
for example, legal implications as companies must now factor climate risks
into shipping contracts to minimise losses and legal disputes
and to keep trade flowing and insurance affordable.
And in fact, we have a whole chapter
dedicated to on this topic of legal implications.
So finally,
the disruptions at the Swiss and Panama canals highlight the
fragility of global supply chains in the face of mounting
climate and geopolitical risks.
With global trade accounting for over 80 per cent of Seaborne transportation,
ensuring
the resilience of maritime infrastructure
and accelerating
the transition to low carbon shipping are critical
for maintaining the stability of global trade.
So thank you so much.
Thank you.
for
this overview
again, the key assessments, the insights
and a bit of looking ahead in
the context of vulnerability, uncertainty,
and who pays? Who pays the price?
I think
I have here from the floor here at the Palais. There's no question. So we go
directly over
to,
uh, online. Um, I see here
one hand raised to start with,
uh, Paula
Dupras
Dubard,
Please. Thank you.
Yes. Uh, good afternoon. Thank you very much for that presentation.
Um, I'm sorry if I missed the first couple of minutes of the presentation, but,
I have two questions first of all, uh, with the the issue of climate change, and I'm
thinking about the impact on, uh, that it's had on the, uh, Panama Canal.
I'm wondering if we can imagine,
um, in the future, uh, near further,
Um, potentially a closure of that that route.
Uh, and then secondly, um,
I wanted to know, um, understand, from your perspective, how you see the efforts by,
uh, the sector, uh, freight and shipping sector. Um,
uh, on,
uh, transitioning
away from
the most polluting, um,
fuels that had been used in the past.
How That's proceeding
if they're on schedule and so forth.
Thank you. So, two questions. One climate impact
example Panama Canal
that we witnessed also with the Secretary General
and with our colleague Jan Hofmann here earlier in the year. And then low carbon
maritime transport. Thank you.
I think that the the question you raised about the climate change is is very,
very pertinent.
You see what we
have not seen but what we saw with the Panama Canal,
you know, it's the The impact came so fast and so hard,
and I don't think it was ever anticipated
such a drought would come. The water levels would fall that far.
And then, you know, this would affect the global shipping.
But I think this is the new normal I think we need We will have. We will have to
anticipate
a
lot more climate change in use,
supply chain difficulties as we go forward,
especially
when these things happen in choke points, then you basically
everything comes to a standstill.
I think I will also get
because Ian
has been talking about the shipping sector and the decarbonisation
and done a lot of work. Let me give to Jan
to address this issue.
But I want to say one thing.
I think it's I mean, we all need to decarbonize
every sector.
That's the future.
We are now talking about the climate change impact of all our lives.
So this is something we have to do.
But it also has to be done
with due consideration given to developing countries,
especially to low income countries.
They need to be supported
to create new investments as we transition towards a low carbon
shipping or low carbon world.
I think
you can.
I think probably you would know more about the technicality.
Yep.
OK, thank you
on the two questions. Also the one on the
hypothetical question. What would happen if the Panama Canal were really 100%
closed?
In fact, on the differences between the two canals, ZIS
and Panama, there's some really novel, insightful
research in our report. Please look at figures five and seven from the overview.
It's really worth it.
You see how different canals have different
impacts on different sectors and the Pan
canal?
If it closes, you can still get containerized trade to the United States
via the Pacific.
Then you use the land bridge from Los Angeles to New York
or via
Suez.
If Sue
is open,
while for dry bulk, there are very little alternative.
So the dry bulk that goes through the Panama Canal has no alternatives,
and we have seen with the current restrictions, So that's not hypothetical.
It's hard data,
the business that was most affected by the Panama Canal crisis,
where the dry bug,
the grains, coal and so on trades
while the ZZ
Canal had a huge impact, especially on container freight rates.
So
that is on that first question.
Hypothetically, if it were to close down completely,
I want to draw your attention also to a little update. So we have the
R,
my time transport with our analysis
and with the kind help of Marcelo and Team and the
We have a data story where we have updated just for you
until yesterday. The very, very latest data
where we can show that the Panama
Panama Canal is actually recovering.
It still faces challenges with the latest average like 30 transits per day,
which is 30% below its peak. But it is already 40% above the previous low point,
where the
Suez Canal is still today,
57% below its peak and not above at its low point.
So there you see these different trends
on the second question of the
decarbonisation of the sector.
Yes, we have worked very intensively on this.
Last year's Riva Maritime Transport has a whole special chap on it
since we published last year's report. Unfortunately, we realise
emissions are still going up. Total emissions from shipping continue to increase,
although they should be decreasing.
It depends a bit on what numbers you look at. If you look at the numbers
emissions per tonne of cargo or per tonne mile, we do see improvements.
However,
half of that improvement is just economies of scale.
It's because ships get bigger and it would be a long story.
We are not fans of ever bigger ships.
They have other disadvantages on market concentration on
door to door costs on infrastructure needs.
So
your question was, Are we on track or not?
I dare say the International Maritime Organisation and its members,
they are on track with their objectives.
They have advanced a lot with the negotiations of how to get there.
They have not yet agreed. But we at an
have helped them to come to an agreement. And
with the research we have done, some of it is in the review.
It
is quite clear to us that you need
a combination of technical measures and economic measures.
Shamika also referred to it.
The economic measure, meaning some price on carbon, achieves two things.
First, it makes the alternative view its competitive.
And secondly,
it generates funding that can then be invested in the energy transition,
especially in those that are most negatively affected.
The small island developing states least developed countries. Thanks.
Thank you. Jan. Um,
I'm not sure if you have more questions. Uh,
on, uh, online. I can't see any. Any virtual hands raised.
The
question francais.
We have, uh, interpretation here. If anybody online
wishes to speak
on
francais and
EOL
Deutsche
kwe
unbeaten at talk
I think there is no further question. So just to wrap it up, if I may,
dear colleagues who underscore the critical vulnerability
of maritime chokepoints such as the Suez
and the Panama canals, we remind you of our figure.
These canals handle around 80% of the world's goods
by volume. Hence the importance.
Addressing the vulnerabilities in maritime
points is not just about trade.
It's about safeguarding global food
security as well and energy supplies.
Urgent resilience Building is needed across the globe,
the global maritime transport system particularly.
And this was addressed as climate change
has increasingly disrupted key shipping routes. And
I take note that there are two more questions from online. Excellent.
So we have one.
I take them in the order as I see them. There are three more
as they come. So it's good.
Um, first, the floor to Matt Coin from trade winds. Thank you.
Hi.
Yeah, um, in the in the in the report,
it's mentioned sort of combating fraudulent ship registration.
Um, we talked a little bit about sort of all the issues,
sort of facing maritime transportation and
and how you know there are significant downside risks to the, um,
projections you've made, I guess I was just wondering, um
you know that that that you're concerned about these fraudulent
ship registrations sort of suggests that you're aware of that.
There's almost sort of becoming two tiers, at least in in oil tanker trades.
And, um, could you speak at all?
Maybe to the issues that, um, a two tier shipping market,
um could create where there's, like, sort of a mainstream market,
and then the shadow fleet and all the issues
that come with that in attempting to build resilience and combat.
Uh, climate change green.
You know, green shipping, all of that.
Thank you. Trade
wins.
Yeah. No, thanks for a good question.
Uh, Angad
collaborated again with the Imo and World Maritime University and
ily and Malita on a on a study on the
fraudulent ship registration.
this to some extent, it was
natural. It was initiated because of of current.
But it's a long term
story. It is. Um, it's not something
that has just appeared. We have always had situations
where ships try to avoid
regulations in general, not so much the sanctions and then swap the flag.
And this has become
actually more difficult over the last
years. Decades.
we do want to distinguish this from the what
you mentioned the recent dark fleet or shadow fleet,
which
is to some extent made easier by quickly switching the flag and possibly to
a fraudulent like you register a flag and you claim I'm flying this flag.
But actually
you never really registered there.
So
to make the fraudulent registration more difficult,
the Imo
is working on an update of existing
regulations and trying to enforce them more
forcefully.
And there, as I said, we have collaborated with them with the study,
also with some statistics and some legal assessment,
the Dark Fleet and shadow fleet.
It's also about switching off your satellite system.
It's really to be totally under the radar
and with or without fraudulent registration. So
it's a bit to clarify.
These are two separate things, but they are both quite important. You have a quite
detailed good assessment legal assessment of these,
especially for the fraudulent
ship registration issue in Chapter five.
Thank you. Thank you so much. We have another question online.
Two more for the time being, uh, Nooran
ul from the agency Anadolu
please. Thank you.
Hello. Thank you for the opportunity to ask.
I would like to ask with regards to who pays the price part.
Do you have any observation on how the increasing freight rates and
the costs have reflected on the consumers in terms of goods price
and a second question on the
routing to the Cape of Good
Hope? Do you see that the
routing could be
kind of permanent, given the continuing situation in the region. Thank you.
Let me start talking a bit about the who pays the for the rising freight rates.
Uh,
we done
a a
quite an extensive simulation analysis just to ask this question,
and we find it's disproportionately is falling on small island developing states
and on least developed countries.
We find that they are hit hard by the moment.
The freight rates go up because they are depending
on enormous amount of imports for the essential food and for energy
and other essential goods and moments the freight rate goes up.
It then translates into increase consumer prices
and which then leads to inflationary
pressures.
And the biggest impacts are on these two groups.
And in fact,
we even had done calculations of to say how much
the food prices would increase and how much the general inflation
would rise.
And so that's one thing.
And the second thing is that, you know,
are we going to see the Cape of Good Hope as the routing point for ever?
I think when it started
there were a lot of issues of congestion
and then the ports unable to manage these flows
of capacity coming their way.
But we
see now you know there's a little less pressure.
There's a you know, learn learning by doing,
uh, but, you know, going through the entire
going through Cape of Good Hope also means
long distances.
It also means, you know, higher freight rates. It means high insurance.
It means all sorts of high cost, you know, added to the wages.
So
again,
the longer the routes,
the higher the prices
and the burden will be again on consumers, and especially the consumers on
small island developing countries
and least developed countries who are depending on the ships to bring them food
and essential medicine and essential goods to their shores.
So this is a very big concern.
You want to
thank you
a very good question. Who pays the price
when we did our assessment on the long term impact If we decarbonize
shipping and that leads to higher freight rates in the long term,
by 2040 by 2050
the normal standard assumption modelling is in.
We pay. The consumer pays in the end,
in competitive markets. At some point in time,
it is passed on to the finer client. So
the consumer pays.
However, we have to distinguish between who
pays and who is impacted.
Example.
Price of shipping bananas from Ecuador
to Germany goes up.
Price for banana goes up.
My mother in Hamburg pays more for her bananas, so the consumer pays
who will be impacted.
The producer of bananas in Ecuador will still be impacted because in the end
my mother will buy a bit fewer bananas from Ecuador and a little more
apples from nearby or bananas from
LAMAs.
So I just want to clarify this. Who pays
who is the one impacted who is suffering
even though the consumer pays in the end in the long term and we do believe
overall, most shipping markets are competitive,
but still also exporters, for example,
from South America are impacted in terms of the specific
numbers. As
Shamika rightly pointed out,
We had done these assessments of how this
impacts prices and thank you also for this question
already
2.5 years ago, three years ago. Actually it started when,
when Paul
Hochman was still saying, Do not worry about inflation during Covid.
We already did a simulation at that time
and said Well, if container freight rates go up by so and so much,
we expect that global consumer prices will go up by
1.5% points due to the higher freight rates during Covid
six months later. Now, 2.5 years ago, like six months after we did that,
the International Monetary Fund calculated
we have inflation
and they confirmed that 1.5% point of that inflation
at that time was due to higher prices.
So with this experience,
we are confident that our method is good because it was verified
this river
and transport. You will see that
the more recent surge in freight rate not quite as bad as during covid, but also high.
So you will see in Chapter three. I believe it is.
So if the current crisis on the choke points continues and
the freight rates continue to remain high,
the
consumer prices could rise by 0.6%
by 2025 or by end of 25 I believe so. There's always a time lag
and the increase of prices for C small
states is 50% bigger, 0.9%.
So I hope that answers your questions. Thank you.
Thank you. Thank you. Young
apologies. I forgot the
secretary. I had to turn on my page.
There was a question of the ships going around
South Africa
and also
Shamika alluded to this.
Initially, the African ports were not ready for this search,
especially the huge container ships.
They don't have cargo for Abidjan or for Durban or for Mombasa.
But they may need to stop for repairs for bunkering.
And it just caused additional congestion.
And we were asked, Should African ports now invest in new capacities in
better going
to benefit from the additional ships? And it's really a very, very tricky question.
If we knew the answer to your very good question
how long this will last and we would say yes,
invest it's an opportunity.
But if you now invest and we hope not too many months,
ships will again take the more efficient route
less costly, less co two emissions faster,
then this investment would have been done in vain,
so can only confirm your good question.
Thank you. Thank you.
As you know, in economics, at least two perspectives to one single reality,
if not many more.
We have two more questions online here, posted
via the chat first from Justine Fontaine
from
an
I'm going to read it out to you colleagues.
Can you elaborate on what are the concrete consequences for African countries
of geopolitical issues in the Red Sea?
It's a two pronged question also. What perspectives do you see for 2024 regarding
African countries
again?
So it's
Africa with two. Focus with two with two different perspectives.
One concrete consequences for African countries
of the geopolitical issues in and around the Red Sea and of course,
their perspectives for 2024.
And I guess also for the immediate future in the New Year. Thank you.
Let me start saying something and then I think we have a whole piece
that we developed for the continent.
You can
drag that one.
bring that one. Let me say the consequences for African countries.
You know,
lot of African countries are small,
open economies.
They're not massive economies.
There's only 10 per cent of their GDP in export and import trade. No,
they are small, open economies,
meaning that they depend largely on international trade,
for their growth for the competition
and also for their well being.
Meaning imports coming their way, the food, the medicine and so forth.
So any kind of geopolitical situation
that creates difficulties for supply chains.
These countries get affected, and it is. It's very simple.
And they are at the brunt of any
political
geopolitical upheavals
that
upend
the international maritime trade, the supply chain situation, logistics
situation. They affect
African countries because they are small,
open economies. Most of them.
Thank you.
Yeah. Thanks.
yeah, Very,
very true.
We two additional thoughts on this impact, especially in Africa.
We did calculate what share of countries trade normally goes through zoo
as you have this
in figure 1.7.
So if I go by order of share,
the biggest share almost 34% of trade by volume
of Sudan would normally go through the wizards.
Our estimate followed by Yemen, followed by Djibouti, followed by Saudi Arabia,
followed by C.
So those are the top five countries
whose trade just quantitatively is most negatively
affected by the limitations of going through the
second
to complement.
When you say Africa, we often may think just sub Saharan Africa. Of course,
Egypt itself
and also other northern African countries,
especially in the eastern Mediterranean,
are very negatively affected.
Both now their own.
Egypt first loses the income from its canal.
Secondly, it loses the business of its transshipment port and
the ports and
the services.
And thirdly, Egypt and other eastern Mediterranean countries.
They are all of a sudden no longer
at the centre of routes that connect and may have a hot port and transshipment
in
Pires
in in Malta, in
or in Egypt.
But all of a sudden at the end of a cul de
sac, how do you say this in English at
that?
And
so the ships have to go the long way.
And then they made transship in Morocco. So Tanja made benefits from
the city
different
Valencia,
Barcelona.
So there is some additional positive impact and the third impact FMI
already alluded to.
If you have a global increase in freight costs,
those countries that are more open depend more on shipping,
be they in Africa or be they in the Pacific.
Are the ones more negatively affected?
Thanks.
Thank you. We have one more question also via chat from Inaki
Carrera
from the Spanish digital newspaper
El
Mercantil.
It's in relation to food security, specifically which we addressed before,
and I'll read it out in relation to food security. Ukraine has just asked
the
the International Maritime Organisation
for help in curbing Russian attacks on grain
carrying merchant ships in the Black Sea.
It is a fact that Russia has intensified its offensive against the port of Odessa
and commercial vessels in the area.
What solutions? And here comes the question. Against that
backdrop, the journalist asks,
What solution does
propose to put an end to these attacks
and to the food war waged by Russia
to dominate African
and less developed
countries? Before passing the floor
to our director? Just let me remind
everybody that's
role is technical.
The organisation does not have a direct mandate, of course, to address
military conflicts or even maritime security.
As such, of course, we must focus on our expertise, which is
in and around trade and development. Thank you.
Thank you very much.
I think I want to bring you back to what I said about the downside risk
when we talk about the 2025 and beyond.
And I said the downside risks loom
and very high
and
want to emphasise geopolitical upheavals on relenting conflicts and wars.
Never bode welfare,
international trade
and maritime trade.
So
is the peace
equal
more trade?
So that's what we would like to see. Thank you.
Thanks.
No. As Marcelo rightly pointed out,
there are some aspects that are really more the mandate of the Imo.
But I think we can proudly say that
participated in the Global Crisis Group.
Our Secretary General
was, I believe, instrumental in certain solutions the Black Sea,
the grain initiative.
So
that requires collaboration between
countries between Ukraine, Russian Federation, Turkey
and the United Nations. So
there's really not that we can add here, but based on our assessment analysis,
let me share with you the assessment we did already
earlier when the war started and now you could say,
answering your question when the war restarts or we have in this situation,
two things happen. First,
there is less food available, so demand supply of food food prices go up.
The second thing is
those especially countries like Egypt but also Ghana, S,
Djibouti
All of a sudden have to purchase their grain from further away,
and that has again a double impact. First, you have to pay for more days of shipping.
You have to charter ships for more days, which is more money.
You have to pay more days of shipping.
And secondly, just as in food, you have demand supply and prices go up and down
in shipping. Also,
the cost per day of chartering a ship goes up and down with demand and supply.
So when we did the previous assessment,
we found that
half of the increase in the food price after the war crane started half was due to
transport,
and of that half again, half meaning like about 25%
was due to the additional days of shipping and the other 25%
due to higher costs per day of shipping.
I hope that's not too complicated and technical, but
it is an attempt to answer your question.
Thank you. Thank you very much.
Thank you very much.
Director Silan,
Thank everybody for attending for the questions.
The report is up there. You have it in your inboxes.
We have the general overview. We have a general press release.
We have spin offs for regions. Africa was addressed also Asia and Pacific. Also
Latin America. And of course, we remain available for any follow up.
Thank you very much.