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Economic Forum in Dubai finds reasons to be cheerful

While there remain a lot of macroeconomic “issues and challenges”, the global economy “is not as bad as feared at the beginning of the year,” said Tim Fox, head of research and chief economist at Emirates NBD bank, addressing the opening Economic Forum conference session at the Seatrade Maritime Middle East event in Dubai this week.

The oil price has recovered from $30 per barrel to $50, China’s economy has stabilised, and the US is in a stronger position than in Q1, Fox said. Also, the economy of India - the UAE’s main trading partner (ahead of China) - is showing 7% growth and appears ‘resilient’, he added.

However, fellow speaker Tim Power, md of maritime consultancy Drewry, painted a less upbeat picture, especially for the liner trades. CAGR (compound annual growth rate) in world container traffic for the period 1980-2007 was 10%, he said, while after the 2008 crisis it halved to 5%, and was now “2% or less”.

“The container industry in the past could always grow its way out of trouble” in terms of boxship oversupply, he added, but now “those days are gone.

Power therefore welcomed this week’s announcement by Japan’s NYK, MOL and K Line to consolidate their liner interests, calling i potentially a “key moment” in attempts to rebalance supply and demand in the liner sector.    

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