A study of current worldwide shipping and ports disruption has revealed that the EU, followed by the USA and China, had the most port exposure for the fourth quarter of the year. The UK placed sixth at US$20 billion
The study, which was conducted by data and analytics firm Russell Group, pegged the EU’s total exposure at US$509 billion, followed by the USA at US$262 billion and China at US$176 billion. Japan and South Korea rounded out the top five at US$75 billion and US$44 billion, respectively.
According to the study, over half a trillion dollars of trade flows in and out of EU ports, while the UK, which is fast heading to some kind of resolution of its status outside the EU trade zone, is exposed to a relatively paltry US$20 billion across its coastal entry and exit points.
“The current global port disruption has accelerated over this quarter, caused by a combination of COVID-19-related backlogs and Christmas demand creating the recipe for a ‘perfect storm’,” said Suki Basi, CEO of Russell Group. “The economic impact will hit major economies, potentially disrupting the post-COVID economic recovery. What all businesses and consumers are experiencing is connected trading risk exposure.
“While the current pandemic has forced many organisations to reassess their current risk management techniques, these figures, in our view, show that any effective risk mitigation plan needs to have a connected trading risk exposure strategy at the heart of it. Data will be at the heart of this strategy, but it is the associated analysis and actions taken by risk management professionals working with their partners in insurance and risk that will help businesses to plan for the worst while exploiting any opportunities that may arise along the way.”
