6 minute read
At The Prow
An ASM publication Editorial Director:
Sam Chambers sam@asiashippingmedia.com
Associate Editor:
Adis Adjin adis@asiashippingmedia.com
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Contributors: Nick Berriff, Andrew CraigBennett, Paul French, Chris Garman, Lars Jensen, Jeffrey Landsberg, Dagfinn Lunde, Mike Meade, Peter Sand, Neville Smith, Eytan Uliel
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The exclusive shipowners’ club
In our business ecosystem, we like to think of shipowners as being at the very top of the food chain. Their decisions influence the fortunes of everyone below them. They wield power, are feted wherever they go, and more often than not live rather pampered lives. The life of a shipowner is generally a rather exciting one, not for the fainthearted, mind.
Aware of their position atop the shipping jungle, owners tend to be pretty selective about their public appearances, something that became more acute with the explosion in overpromising, underdelivering maritime conferences and exhibitions over the past 15 years.
Go to any shipping conference these days and you’d be hard-pressed to get more than one in 100 attendees being a shipowner. That said, these lions of industry are easy to spot at any of these shows for the swarm of flies circling them, trying to sell them their goods and services.
A shipowner wants to feel comfortable when attending an industry event. He or she would prefer to be with their peers in pleasant surroundings, and not being on the receiving end of myriad sales pitches.
Such gatherings are all too rare hence my delight at the return after a three-year covid hiatus of our very own Maritime CEO Forums, the first one took place at the Fullerton Hotel in Singapore last month with the Monaco Yacht Club providing another spectacular, luxurious location for an October meet-up.
If you’re lucky enough to attend our exclusive, by-invite-only bashes – which we have dubbed as anti-conferences – you’d be agog at who you’d be rubbing shoulders with. Rather than a one in a hundred ratio, our owner to lesser mortals ratio works out at nearly two to one in favour of the former. These forums, a process we have been pioneering carefully and delicately over the past decade, are unique in their access to the industry’s real decision-makers.
By way of gratitude for you being a Maritime CEO reader, if you’d like to find out how you could attend a future event of ours get in touch with me. ●
Sam Chambers Editor Maritime ceo
Recession worries
The American economy is in a confusing state
The US economy has shrunk for the second quarter in a row. In most economies this would be the definition of a recession, however America calculates that equation differently. So whether you think the US has slipped back into recession depends on whose definitions you prefer. Either way though the US is not experiencing growth and that has to be a worry for Washington DC and globally given America’s global economic weight.
America’s economy contracted at an annual rate of 0.9% in the three months quarterly to July 2022. Inflation in the US hit 9.1% in June, the fastest pace of price appreciation in more than four decades. Inflation and price rises are of course a major concern – the cost of groceries, petrol and other basics are rising at the fastest pace since 1981. The US central bank has raised borrowing costs rapidly to try and stop the economy over-heating.
It’s not all bad news in America. Unemployment is low - 3.6 % with hiring rates remaining strong after the 2020 covid dip (see below). Additionally, the US is less exposed than China and Europe from the surge in energy prices from the war in Ukraine. Though the US is obviously offering a lot of financial and material aid and has reduced its investments in, and exports to Russia, significantly.
However, the best news for the American economy is exports. The US trade deficit in goods narrowed sharply in June 2022 as exports surged, while business spending on equipment remained strong, reducing the economy contraction in the second quarter.
Exports though may not be enough to boost the US economy into the third and fourth quarters. Soft housing data, weak business and consumer sentiment surveys indicate that domestically things may be tough. Overall though many analysts believe the economy will pick up in the second half of the year. For instance, investment bank JP Morgan now forecasts that the economy grew at a 1.4% annualised rate instead of the previously forecast 0.7% pace and that the US’s goods trade deficit shrank 5.6% to $98.2bn, the smallest since last November.
By way of contrast imports of goods fell $1.5bn to $279.7bn. American imports were adversely affected by imports of cars and food while imports of consumer and capital goods, however, increased strongly.
So, is the United States in recession or not? Some economists say that the country is in a “technical recession”. By the metrics used in the UK, EU and most countries this is the case. However, America’s National Bureau of Economic Research determines recession based on a range of factors such as GDP, real income and employment and the NBER has not yet designated the US economy as being in recession. In a sense the technical argument is unimportant. What is important is whether the spate of bad numbers from America spooks the markets or not. ●
USA: Employment Numbers in Workforce, 2018-2023
Year mn in employment 2018 155.76 2019
2020 157.53 147.81
2021
2022 (f) 2023 (f)
Source: Statista f=forecast 152.58 158.28 159.58
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