The GDP-teu multiplier even more broken by Trump 2.0
Another nail in the coffin, just-in-case…
As economies continue to rebound, global container trade is expected to grow by 5.8% this year, according to a forecast today from Alphaliner.
Recently, the IMF revised its global GDP growth forecast for this year to 6%, which suggests container volumes are set to track economic growth.
However, Alphaliner’s analysis suggests that in fact the opposite will happen, and “the long-term trend shows a continued decline in the teu-to-GDP growth multiplier, linking container traffic to global economic growth”.
It explained that, in the 1990s, the teu-GDP multiplier hovered around the 3.4 mark and began to decline at the turn of the century – in 2000, GDP grew by around 5% while container volumes grew 12.5%.
From then until the global financial crisis in 2008, the multiplier averaged 2.6, and then fell further, to 1.4, between 2010 and 2019.
The analyst said: “Since 2015, four individual years have dropped below 1x, a situation which may be repeated in 2021.
“The data appears to reflect greater protectionism efforts worldwide and a decline in overall global cross border trade, and removes what was once a key indicator for the industry.”
According to Drewry, global container port throughput declined 1% last year, with 793m teu handled by ports worldwide – which, in volume terms, represented a drop of 9m teu on 2019. Meanwhile, global GDP contracted by 3.3% in 2020.
However, Alphaliner cautioned that trade forecasts needed to be taken with “a hefty pinch of salt”.
It explained: “Throughput forecasts for this year are subject to huge uncertainty, due to the vaccine uncertainty, while the impact of high consumer demand could be curbed by tonnage shortages.”
For example, despite surging global container demand, Hapag-Lloyd’s recent first-quarter results showed a year-on year-volume drop of 2.6%, to 3m teu, which it largely attributed to capacity shortages, in terms of ships and boxes, as well as port congestion.
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