The economic slowdown in Europe and US has
not affected the shipping industry in Southeast Asia due to vibrant trade
within the region that comprised 27 percent of total ASEAN trade last year,
analysts from Frost and Sullivan said.
“People
are questioning the impact of the slower growth of the economy in the US and
Europe. Apparently it hasn’t had any impact on us, because trading among the
countries in ASEAN is increasing. We are expecting an intra-trading increase
from 27 percent to 29 percent this year,” Frost and Sullivan vice president for
transportation and logistics in the Asia-Pacific region Gopal R said.
According
to Gopal, there was an aggressive expansion plan for major ASEAN ports to build
their capacity, which reflected the healthy condition of the industry in the
region.
For
example, the port of Singapore, with a current capacity of 29.9 million 20-foot
equivalent units (TEU), will be expanded to 55 million TEU in 2018, while Port
Klang in Malaysia is going to be expanded to 10 million TEU 2013 from the
current 8 million TEU, and Tanjung Priok will be expanded to 11 million TEU in
2017 from its current 5.9 million TEU.
According
to Indonesian Shipowners Association (INSA) chairperson Carmelita Hartoto, the
overall shipping industry in the country and the region was still strong and
many shipping companies booked profits last year.
“Few
shipping companies are facing financial difficulties due to freight market that
focuses on US and European countries. They are affected by decreasing demand
and the high price of fuel,” Carmelita told The Jakarta Post.
Among
the shipping firms that have been hardest hit by lower demand from the US and
Europe are Berlian Laju Tanker (BLTA), which announced a covenant breach in its
debt payments this year; Arpeni Pratama Ocean Line, which has undertaken a debt
restructuring program; and Humpuss Intermoda Transport (HITS), which may soon
file for bankruptcy.
“Shipping
companies that focus on the domestic market and the ASEAN market generally have
a positive outlook this year because the freight demand is high,” she added.
Deputy
Transportation Minister Bambang Susantono said that Southeast Asia remained an
important hub for cargo flow given its strategic location and the strong growth
in the region.
“Due to
the economic crisis in Europe and US, along with the shift of economic power
from west to east, Southeast Asia will remain the most interesting region for
the next 20 years. This situation means new opportunities are open for new
markets, for example Indonesia,” Bambang said.
Gopal
said that ASEAN had a few trading obstacles, such as a lack of border
management capabilities, lack of trade facilitation and a low competency level
in infrastructure.
“As for
Indonesia, the priorities in port development to support the inter-trade with
ASEAN members are, among other things, the improvement of port infrastructure,
quality road networks between ports and strict and transparent policy in
customs processes,” he said. (nad)
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