At the beginning of 2021, the COVID-19 pandemic has claimed over two Million lives and continues to spread throughout the world. While the health crisis grew, the virus also infected economies and supply chains. Official statistics in developed countries such as Germany capture well the impact of lockdown measures on retail sales or disruption in global trade on national imports.
These official statistics, however, tend to be published with a time lag of several months and even longer for developing countries in the global South. To provide policymakers with more recent information on economic activity, the Kiel Institute for the World Economy (IfW Kiel) published the Corona Data Monitor in 2020 using unconventional, but high-frequent data. For instance, economist Vincent Stamer contributes to the data monitor by analyzing daily API data from FleetMon. Comparing historic ship activity in the Red Sea and the Suez Canal to today’s activity measures the impact of the Corona crisis on the key East Asia – Europe trade route. For more information, please visit the Corona Crisis Data Monitor on the website of the IfW Kiel.
In a recent study sponsored by the German Federal Foreign Office, a project team of the Kiel Institute replicated the concept of the Data Monitor and applied it to various data sources on developing countries. To measure the impact of the pandemic on countries in the global South, the authors used data on nitrogen gas emissions, light emissions, and flight arrivals, as well as AIS data on container ships provided by FleetMon.
As container ships carry approximately 60% of global trade volumes, they are important not just to developed countries, but also to Eastern Asia and other regions. As some specialized containers may also transport refrigerated goods, liquid chemicals and bulk goods in lower quantities, container ships also serve markets that typically focus on the trade of resources and agricultural goods. Hence, activity of container ships may also correlate with the exports and imports of developing countries that are typically not associated with the trade of containerizable goods.
The Kiel economists make the shipping data useful for economic analysis in the following steps: First, the actual draught of a ship at the end of a port call is compared to the range of possible draught values from ballast draught (minimum) to maximum. This gauge of capacity utilization is multiplied with the overall capacity of the container ship in TEU. While this approach may not pinpoint the exact number of containers carried, it nevertheless approximates whether a ship is fully loaded or not.
Second, the departing load is aggregated by week and by port country to associate the trade activity with specific countries and regions. This data is contrasted with a predicted value for the weekly activity – a result of an econometric model encompassing shipping data from 2015 to 2019. As smaller developing countries tend to display highly volatile weekly data, the values are further aggregated at the continental level to show trends more clearly. Figure 2 shows these trends.
Most notably all continents saw significantly lower trade volumes in the first half of 2020. Following drastically reduced exports from China in February, Asian economies also faced great export drops in May and June. Reductions by continent reached 21% in Asia, 16 % in Africa, and 12% in Latin America. More developed countries appeared to fare better as shipping activity slowed by 10% in North America and 5% in Europe. Drops in this magnitude are nevertheless highly significant as the standard deviation of weekly shipping activity only amounted to 3 to 6% in the past years. Remarkably, the data does not record a „rebound“ effect for Asia, Africa, and Latin America following the fall in the spring. However, countries important for the world economy such as Brazil, India, and China have seen a more significant return of trade activity. World economies also begin to face a renewed downturn in December of 2020 as the second wave of the pandemic forces governments to impose lockdowns.
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