[121110.EN.BIZ] Intra-Asia Trade To Play Vital Role

(GUANGZHOU, China) Intra-Asia trade will be the linchpin for the global shipping industry in the near term as the West slowly recovers from the financial crisis, senior maritime executives said on Tuesday.

Led by growing consumer consumption in China and India, intra-Asia trade has remained resilient despite a huge dropoff in overall freight traffic over the last two years.

'Boosted by the expansion of China's domestic market, intra-Asia trade was able to reduce the impact of an economic recession,' said Bronson Hsieh, chairman of Taiwan's Evergreen Marine, at an industry conference here.

'There is no question that intra-Asia trade will be the focal point of the shipping industry in the future.'

Asia's economies are in the driving seat, with the International Monetary Fund expecting China's economy to grow 9.6 per cent next year and India to expand by 8.4 per cent.

The IMF forecasts economic growth in Asia at 6.7 per cent in 2011, compared with 1.8 per cent in Europe and 2.3 per cent in the United States.

A reduction in import tariffs between China and Asean has boosted trade between the two by 47 per cent to US$185 billion within the first eight months of this year.

'In a few years, I do see Asia decoupling from the West,'said Alan Marsh, chief executive of leading shipbroker firm Braemar Shipping.

'Ten years ago, no one would have predicted what is happening with Asian growth and the problems in the United States at the same time.'

Signs of Asia's growing influence have become increasingly evident throughout the maritime industry.

Companies ranging from ship broker Howe Robinson to Rolls Royce and Deutsche Bank have either expanded or relocated their maritime businesses to Asia.

The container industry, which is closely linked to world economic growth, meanwhile, has introduced 26 new service routes between China and the Asean countries this year.

Container trade in South-east Asia rose by 17 per cent to 6.4 million twenty-foot equivalent units in the first half of this year, surpassing the 12-14 per cent increase in the Asia-US and European routes, Evergreen Marine's Mr Hsieh said. - Reuters

Source : Business Times.