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Connecting the world through global shipping networks
Shipping, or the business of transport, is an essential means that facilitates international trading activities. Due to its cost-effective intermodal operations, most of the international trade in manufactured goods and an increasing share of commodities are transported through container shipping services, which are mostly provided by liner shipping companies. They form a network that connects practically all coastal countries worldwide with each other. Liner shipping operations are now increasingly involving transshipment in seaports that act as nodes in the network. Research on global liner shipping networks has expanded significantly. In particular, the United Nations Conference on Trade and Development (UNCTAD) has published the Liner Shipping Connectivity Index (LSCI) at the country-level annually since 2004. The term “connectivity” is increasingly used to characterize national trade competitiveness, and defined at different levels, such as at the country level and bilaterally.
There are three main policy areas that can help to improve the LCSI of a nation:
- Cargo volume: Increasing hinterland access and facilitating transit from neighbouring countries are essential components for the development of international trade. Current challenges to realizing these two objectives often include expensive inland transport and inconvenient border-crossing procedures. One of the effective ways for enhancing shipping connectivity is to improve intermodal inland transport and trade connectivity by improving cross-border procedures and modernizing customs administration.
- Competitive operating environment: Markets need to be competitive. Ideally, shippers should have options among service providers. Any restrictions on transport services, for e.g., cargo reservation regimes which tend to restrict trucking operations or cabotage in shipping, will negatively affect maritime connectivity.
- Efficient and modern seaports. Physical infrastructures are an important component that determines the accommodation of ever increasing vessels. Infrastructures need to have the necessary water depth and ship-to-shore container handling cranes. Modernized port operations are also important to avoid delays and uncertainties, which in turn also help to improve transport connectivity.
