Fears of a global recession and the potential impact of the UK’s vote to leave the EU have put further pressure on global shipping confidence is at an all-time low according to a transport survey from law firm Norton Rose Fulbright.
The global container sector and the dry bulk shipping market are struggling with a surfeit of ships and a stuttering global economy.
Norton Rose Fulbright found in its annual survey that only 15 % of respondents saw current market conditions as positive, the lowest level since the poll began in 2009. Shipping was the gloomiest transport sector canvassed.
Meanwhile 68% of respondents said that a global recession posed the greatest threat to shipping in coming years – a significantly higher proportion than saw it as the major threat to aviation (38%) and rail (20%).
Norton Rose Fulbright’s global head of transport Harry Theochari said that “the industry is currently in the grip of the worst recession in living memory and while most of our respondents envisage an upturn in freight volumes in the next five years, any major economic shock would further exacerbate an already fragile industry.”
He added: “The UK’s vote in favor of a Brexit has meant that shipowners are likely to be assessing how it impacts upon their various regulatory obligations and their access to finance in a key shipping finance market,” he said, referring to the role of the City of London.
“Shipping continues to feel the effects of overcapacity in many markets, and an increase in enforcement actions is widely predicted.”
The survey polled 200 respondents across the transport industry including companies, financiers and government entities.