UNCTAD Warns of Unprecedented Disruptions to Global Trade

The United Nations Conference on Trade and Development (UNCTAD) has raised concerns about the increasing disruptions to global trade due to geopolitical tensions and climate change. According to UNCTAD, important shipping routes such as the Black Sea, the Suez Canal and the Panama Canal are being particularly affected, with weekly transits through the Suez Canal falling by 42% over the past two months. Ongoing conflicts and climate-related challenges have led to a dramatic decline in trade across key global routes.

The disruptions in maritime transport, which accounts for over 80% of global goods movement, have resulted in longer freight routes, higher trading costs, and an increase in greenhouse gas emissions. For example, the crisis in the Red Sea has caused shipping companies to temporarily stop transits through the Suez Canal, leading to a 67% decrease in weekly container shipping shipments. As a result, container spot freight rates have significantly increased, with fares from Shanghai to Europe tripling and fares to the West Coast of the US increasing by 162%.

UNCTAD warns that these disruptions could have far-reaching economic consequences, including rising food and energy prices, delayed deliveries, and higher costs. The organization is particularly concerned about the impact on developing countries, which are more vulnerable to these disruptions, and calls for rapid adjustments and strong international cooperation to address the rapidly changing global trade dynamics. It underlines the need for joint efforts to find sustainable solutions, especially to help the countries most vulnerable to these shocks.

Source .