The global shipping industry will see lower demand in coming years, all other things being equal, than was previously expected due to fragile and uneven global recovery, according to BIMCO.
According to the latest Update of the World Economic Outlook from the International Monetary Fund (IMF), the global investment has been weaker for some time now, limiting the prospects for higher growth going forward.
“This has led to a lowering of 2015 expected growth more or less across the board. Moreover, the burden from the recent years of crisis still haunts primarily the advanced economies, whereas several emerging and developing economies which are running at a higher growth level are been dragged down by poor export markets,” BIMCO said.
- The US is expected to grow by 3.1% up by 0.5 from IMFs most recent July estimate. Employment numbers are strong, so now higher wages are anticipated to follow suit soon in order to develop a sustainable economy for the future
- In the Euro Area, Germany, France and Italy are all revised downwards by 0.4-0.5. This leaves Italy in negative territory for the third year running, at -0.2% for 2014. France is now expected to grow by 0.5% and Germany by 1.4% in 2014.
- Forecast for India is up by 0.2% to 5.6% with China hanging in there at an unchanged 7.4% for 2014.
- Finally, Russia is expected to take more hardship from its involvement in geopolitical uncertainties with Ukraine. IMF halved its forecast for 2015 growth in Russia now seen at 0.5% with 2014 still staying above water at 0.2%.
Chief Shipping Analyst at BIMCO, Peter Sand, said:“For container shipping it is positive that the US is now set to grow stronger. Even though demand from the Euro Area pulls in the other direction, the sum of the parts are still positive.“