FBJ 4 FREIGHT BUSINESS JOURNAL


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By Chris Lewis


Mixed messages are emerging on the likely long-term economic impact of Covid. This is hardly surprising, since the scientists themselves cannot form a consensus on the long-term medical prognosis. However, it does seem that projections of a so-called V-shaped recession – with recovery taking place in a similar timescale and of the same magnitude as the original dip in activity - are a tad optimistic. Still, if the economy is more or less back to its former strength and size by late 2021, as the Bank of England is now suggesting, we can all breathe a collective sigh of relief. One thing that has become clear though is that the crisis has affected different sectors of the economy differently; indeed some areas, such as internet home delivery and grocery retail have actually gained from it. The losers are, predictably enough, businesses that depend on large gatherings of people such as pubs and gyms. Some of the predicted unemployment figures sound pretty scary, though perhaps rather fewer in terms of absolute numbers of jobless than during the dark days of the 1970s, for those who can remember back that far. No doubt government will do whatever it can to try and ensure that the economic misery is shared out as evenly as possible, possibly in the form of higher taxes and other charges. We will surely be paying for Covid for many years to come.


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“It could never happen here” is a risky statement to make, in the make of the monumental tragedy that took place in Beirut on 4 August. Many of the cargoes that are routinely shipped around the world have the potential to catch fire, if not explode – even more so if they are not stored or handled correctly. It won’t have gone unnoticed that the Beirut explosion happened almost five years to the day after the similar tragedy in Tianjin in China. Comments have appeared on news websites covering parts of the UK with large chemical manufacturing and storage industries asking certainly valid and understandable questions about how safe such operations are in this country. However, our sincere hope is that the circumstances that conspired together to create something so massive as the Beirut explosion are not replicated in other parts of the world. A large cargo was stored in what was self-evidently inadequate warehousing. Moreover, given Lebanon’s political and economic troubles, supervision of port activities was no doubt not the best. It didn’t help, either, that Beirut port is surrounded by the urban area – not a situation commonly found in Europe, where most commercial port activities have been moved upriver and out of town. Notwithstanding all the foregoing, an immediate review of how large quantities of potentially hazardous goods are dealt with, particularly in circumstances such as vessel arrest or unclaimed cargoes, would be in order to set peoples’ minds at rest.


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One of the slightly unexpected side-effects of the Covid crisis was the sudden clearing of the air over many of the world’s major urban areas. With car commuters and many freight movements temporarily halted, the smogs that routinely obscure the sun in many cities disappeared. Now, with the easing of lockdowns and the world’s motorists on the move again, we are pretty much back to where we started, but the sudden improvement in air quality that resulted has not been lost on politicians around the world. It could give fresh impetus to attempts to get more freight off the roads and on to greener means of transport such as waterways or the railways. There have been many such attempts in the past, but they have often suffered from fragmentation and lack of funds. This is something that the new Thames Estuary Growth Board, with its ‘Green Blue’ scheme hopes to address. By taking a holistic view of the river, helping to overcome the many technical and funding barriers that exist to freight on the water and, crucially, with the backing of Government, things might finally start to move – literally - on the Thames. There is a groundswell of public opinion in favour of decarbonisation, and


As the defi nitive publication within the sea, air, road and rail freight sectors, each issue includes regular news and analysis, in-depth coverage discovering the business decisions behind the news stories, shipper and exporter reports, opinion, geographical features, political and environmental issues.


If you have any stories or letters which should be of interest or any feedback on FBJ, please contact our editor Chris Lewis - +44 (0)208 6450666 chris.lewis@f j-online.com


next issue >> circulation >> Our next issue will include features on: Ireland (supplement), Iberia and Freight Audit & Pay/Blockchain.


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today’s environmentally-aware voters will demand effective action, soon.


Guest Opinion - Chadd Blunt, managing director of Birmingham forwarder, Millennium Cargo Services Does Coronavirus spell the end for China’s manufacturing gold rush? For more than a decade China has dominated the manufacturing world thanks to its cheap prices and vast manufacturing capabilities. When Covid-19 shut down its factories, and countries all around the world refused to allow ships from China to enter their ports, delaying shipments by months, many people predicted that this spelled the end for the Chinese manufacturing ‘gold rush’. But is that really the case? As we all know, Covid-19 failed to be contained and over the following months spread to nearly every country in the world, with more than 7 million confi rmed cases and 400,000 deaths. Businesses were forced to close their doors, economies have been battered and governments have struggled to keep up with a pandemic they were clearly not prepared for. Despite Covid-19 no longer being a ‘China’ problem, some still felt it would have a serious negative impact on the country’s economy, with more people choosing to buy from countries closer to home. However, as time has gone by, it’s clear that this is most defi nitely not the case. While we did see an initial dip in goods moving from China when the factories fi rst closed and before Coronavirus became a worldwide problem, that dip has now corrected itself. Here at Millennium Cargo, we’re moving just as much cargo from China as ever - there’s no sign of it signifi cantly decreasing. I think as time goes on we will see retailers start to diversify their manufacturers a little, perhaps having the bulk of their goods manufactured in China, but some also coming from India or South Korea to give a little added security. It’s unlikely that more businesses will opt for UK-based manufacturers. China has been a manufacturing powerhouse for more than a decade. Their low production costs mean that British manufacturers just can’t compete on price. We all love the idea of ‘buying British’ but are businesses willing to put their hand in their pockets and pay double the price to do so? Usually not. That’s why China’s position is so secure - the UK just can’t compete. So did Covid-19 spell the end for China’s dominance in the manufacturing industry? It doesn’t look like it. But only time will tell if this big shakeup has opened up the doors for one of the other keen contenders, such as Japan, South Korea or India, to secure themselves a larger chunk of the market share in years to come.


Issue 6 2020 - Freight Business Journal From the Editor


///NEWS


FBJ is the only UK and one of the few pan-European Multimodal newspapers. The comments we have received prove there is still room for a hard copy publication within the freighting industry. You don’t have to look at a screen all day!


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