Singapore presentation 26062012 updated

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Singapore presentation 26062012 updated

  1. 1. European crisis, global trade  and the shipping sector Dr. Demos Petropoulos Managing Director  DPSS Global Consultants Limited
  2. 2. World Economy
  3. 3. The wheel of crisis turns slower
  4. 4. Economic and Sovereign crisis 2010‐2012 Middle East European Sovereign Debt  Political Unrest CrisisUS and EU‐ High  China‐ Increasing  Japan‐Natural DisasterUnemployment Rates Inflation 4
  5. 5. Monetary policy will be extremely accommodative, but there is a risk  Asia continues towards the pinnacle  that inflation remains relatively  of power albeit at a lower speed. high. ‐Real Economic Activity has  weakened and Growth Rates=  ↓ ‐Trade growth to slow in 2012  after strong deceleration in  2011. Fiscal policy, financial sector  Europe is experiencing a mild regulation and the oil price poses  recession‐but with major regional  the biggest risks to our growth  differences. forecasts. The US weathers the storm. 5
  6. 6. Gross Domestic Product around the GlobeSource: Bloomberg 6
  7. 7. Source: Bloomberg
  8. 8. 8Source: Bloomberg
  9. 9. European Economic Crisis
  10. 10. High Private Burst in asset pricesIndebtedness (Financial Lost volatility and Competitiveness uncertainty) Severe Structural  Unemployment Weak credit  owing to  banks’ funding  difficulties  European Sovereign  Debt Crisis 10
  11. 11. European Economic Sentiment IndicatorSource: EUROSTATESI persistent decline driven by falling confidence in all business sectors, especially  11in industry and retail trade
  12. 12. Real GDP growth and trade of euro area economics, 2008‐11 12Source: OECD Quarterly national accounts.
  13. 13. The Effects of an intensified Euro Area crisis on various Regions Source:  Morgan Stanley
  14. 14. Effects on Shipping  Industry
  15. 15. Source: Platou, DPSS
  16. 16. Source: Platou, DPSS
  17. 17. The Global Ship Finance MarketSource: Petrofin / DPSS Research  20
  18. 18. The Global Ship Finance Market 21Source: Petrofin / DPSS Research 
  19. 19. Total Merchandise Trade ‐ Exports 20.00 50.0% 18.00 40.0% 16.00 30.0% 14.00 20.0% Value in Trillions US dollars 12.00 10.0% 10.00 0.0% 18.22 8.00 16.13 ‐10.0% 15.25 14.01 6.00 12.12 12.53 ‐20.0% 10.50 9.22 4.00 ‐30.0% 2.00 ‐40.0% 0.00 ‐50.0% 2004 2005 2006 2007 2008 2009 2010 2011Source : World Trade Orginisation Exports Annual Increase 22
  20. 20. Seaborne Dry Bulk Volumes Mln Tons 5,000 Mln DWT 700 4,500 600 4,000 3,500 500 3,000 400 Other 2,500 Soybean 300 Cement 2,000 Steel products 1,500 200 Grain 1,000 Steam coal 100 Met coal 500 Iron ore 0 0 2006 2007 2008 2009 2010 2011 2012 2013 2014Source: Clarksons, DPSS 23
  21. 21. Source: Platou, DPSS
  22. 22. 100 Global Orderbook and Yard Utilisation 2008‐2012 100% 90 95% 90% 80 90% 84% 83% 70 82% 85% 80% Global Yard utilisation 60 80%Million cgt 54  50 50  75% 48  48  45  40 70% 74 67 30 60 63 65% 51 20 60% 10 55% 0 50% 2008 2009 2010 2011 2012 Capacity Scheduled delivery Actual delivery Global yard utilisation Source:  Clarksons, Danish Ship Finance 25
  23. 23. Dry Bulk Seaborne Trade Volume 10% 9% 8% 7%Annual growth 6% 5% 9.0% 9.0% 4% 8.0% 7.0% 3% 2% 3.0% 1% 2.0% 0% 2007 2008 2009 2010 2011 2012 Seaborne Dry Bulk trade growth Source: IHS Global Insight, Danish Ship Finance 26
  24. 24. 27Source: Bloomberg
  25. 25. Dry Bulk Fleet Annual Growth 120 18% 17% 100 14% 80 19 12% 10% 18 15 10% 60 23 Million dwt Scrapping                Deliveries 7% 7% 16 26 40 10 6% 9 7 47 20 5 8 42 35 7 28 11 14 0 0% ‐20 ‐40 ‐6% 2007 2008 2009 2010 2011 2012 Capesize Panamax Handymax Handysize Scrapping Annual increaseSource: Clarksons, Danish Ship Finance 28
  26. 26. Source: Platou, DPSS
  27. 27. Asian Economies
  28. 28. EU TRADE WITH MAIN PARTNERS (2011) The Major Imports Partners The Major Exports Partners  The Major Trade PartnersRk Partners Million euro % Rk Partners Million euro % Rk Partners Million euro % Extra EU27     1,683,931.0 100.0% Extra EU27    1,531,122.00 100.0% Extra EU27      3,215,053.0 100.0% 1 China          292,070.9 17.3% 1 UnitedStates          260,566.8 17.0% 1 United States        444,708.0 13.8% 2 Russia          198,178.2 11.8% 2 China          136,216.9 8.9% 2 China        428,287.8 13.3% 3 United States          184,141.2 10.9% 3 Switzerland          121,690.6 7.9% 3 Russia        306,627.1 9.5% 4 Norway           93,528.7 5.6% 4 Russia          108,448.9 7.1% 4 Switzerland        212,894.7 6.6% 5 Switzerland           91,204.1 5.4% 5 Turkey           72,587.6 4.7% 5 Norway        140,059.6 4.4% 6 Japan           67,444.8 4.0% 6 Japan           48,970.3 3.2% 6 Turkey        120,176.0 3.7% 7 Turkey           47,588.4 2.8% 7 Norway           46,531.0 3.0% 7 Japan        116,415.1 3.6% 8 India           39,256.9 2.3% 8 India           40,419.4 2.6% 8 India            79,676.2 2.5% 9 Brazil           37,751.6 2.2% 9 Brazil           35,729.7 2.3% 9 Brazil            73,481.3 2.3%10 South Korea           36,057.0 2.1% 10 United Arab Emirate           32,614.2 2.1% 10 South Korea            68,475.6 2.1%11 Saudi Arabia           27,933.3 1.7% 11 South Korea           32,418.5 2.1% 11 Saudi Arabia            54,328.8 1.7%12 Algeria           27,534.4 1.6% 12 Australia           30,804.9 2.0% 12 Canada            52,459.6 1.6%13 Nigeria           24,190.0 1.4% 13 Hong Kong           30,189.6 2.0% 13 Singapore            46,068.8 1.4%14 Taiwan           23,917.1 1.4% 14 Canada           29,607.2 1.9% 14 Algeria            44,739.0 1.4%15 Canada           22,852.4 1.4% 15 Singapore           27,131.3 1.8% 15 South Africa            43,412.9 1.4%16 Kazakhstan           22,672.7 1.3% 16 Saudi Arabia           26,395.5 1.7% 16 Australia            42,559.7 1.3%17 Malaysia           20,988.0 1.2% 17 South Africa           25,639.0 1.7% 17 United Arab Emirate            41,384.3 1.3%18 Singapore           18,937.5 1.1% 18 Mexico           23,802.6 1.6% 18 Hong Kong            40,322.4 1.3%19 South Africa           17,774.0 1.1% 19 Ukraine           21,197.0 1.4% 19 Taiwan            40,124.2 1.2%20 Thailand           17,534.2 1.0% 20 Algeria           17,204.7 1.1% 20 Mexico            40,071.8 1.2% Other 74.6% Source: DG Trade Statistics
  29. 29. Source: DG Trade Statistics, DPSS Research
  30. 30. EU Countries Debt and % GDP 165.3% 2500 1.8 2,088 1.6 1,949 2000 120.1% 1.4 1,717 107.8% 1.2 98.0% 1500 85.8%Billion USD 81.2% 1 72.2% 68.5% 65.2% 0.8 1000 735 0.6 0.4 500 362 356 393 217 184 0.2 0 0 Germany France Belgium Austria Greece Italy The Portugal Spain Netherlands Debt % GDP Source: EUROSTAT, Bloomberg, DPSS Research
  31. 31. Asia holding up• Despite the global slowdown Asia : – enjoys robust domestic demand – low unemployment  – continued credit growth in the region.China  Japan• China’s economy expected to grow at 8 • Recovery fueled by reconstruction percent in 2012 as global demand spending and private consumption slows • Long‐term challenges include tackling high• Should downside risks emerge, China public debt, low growth has room for strong fiscal stimulus • Financial sector has been resilient, but risks• Chinese currency now assessed as remain "moderately undervalued" 37
  32. 32. • The EU is China’s biggest trading partner and its largest ASEAN  foreign investor. It is also its China biggest competitor in the East Asian Markets. • The Chinese market is• The EU is the becoming a key-role player largest investor in for intra-Asian and Asia-South ASEAN countries trade. but FDI inflows declined as a • Originally characterised with a consequence of the strong trade surplus in favour European crisis. of Japan. • The EU-Japan trade Japan relationship has recently Net Imports  become more balanced €202 bln Korea • The EU is the biggest investor Singapore in South Korea. • Singapore emerges as the EU’s • EU-South Korea Free trade main FDI partner among the agreement pushed up trade ASEAN countries. volume. 38
  33. 33. Combine Exports China, Korea, TaiwanSource: Morgan Stanley, DPSS Research  39
  34. 34. Europe Dampens Outlook Euro Leaders should: Diminish all uncertainty caused. Tighten monetary policy Strengthen fiscal position Maintain sustainability of healthy public finances. Manage economic and financial integration between emerging and advanced Europe 40
  35. 35. Key Economic Analysis
  36. 36. 42
  37. 37. Price of Oil 2010‐2012
  38. 38. Who Has the Gas?Data Sources: IEA 44
  39. 39. Stocks PerformanceThe MSCI All‐Country World Index (MXWD) of stocks dropped 7 percent since the beginning of May, tumbling to $305.6 last week. The index today climbed to $305.60, market volume of 33,31trillion dollars ‐ Bloomberg data show.
  40. 40. Source: Bloomberg
  41. 41. DPSS Global Consultants Limited P.O.Box 70681, Limassol 3801, Cyprus Telephone : +357 25 734 888 Email : info@dpssglobal.com Webpage : www.dpssglobal.com
  42. 42. DisclaimerThe material and the information contained herein (together, the "information") are provided by DPSS Global Consultants Limited ("DPSS") for general information purposes.The Information is drawn from DPSSs database and other sources. DPSS advises that: (i) any Information extracted from its database and other sources is derived from estimates orsubjective judgments; (ii) whilst DPSS has taken reasonable care in the compilation of the Information and believes it to be accurate and correct, data compilation is subject to limitedaudit and validation procedures and may accordingly contain errors; (iii) the provision of the Information does not obviate any need to make appropriate further enquiries; (iv) theprovision of the Information is not an endorsement of any commercial policies and/or any conclusions by DPSS and its connected persons, and is not intended to recommend anydecision by the recipient; (vi) shipping is a variable and cyclical business and any forecasting concerning it cannot be very accurate. DPSS and its connected persons make norepresentations or warranties of any kind, express or implied about the completeness, accuracy, reliability, suitability or availability with respect to the Information. Any relianceplaced on such information is therefore strictly at the recipients own risk.This information is confidential and is solely for the internal use of the recipient. Especially, the information is not to be used in any document for the purposes of raising financewhether by way of debt or equity. All intellectual property rights are fully reserved.To the extent permitted by law, DPSS and its connected persons shall not be liable to the recipient or any third party for any loss or damage of any kind arising out of or in connectionwith the Information, including without limitation any direct, special, indirect or consequential damages (e.g. damage for loss of business or loss of profits) whether caused by tort(including negligence), breach of contract or otherwise, even if foreseeable.In this disclaimer ‘connected persons’ means, in relation to DPSS, the shareholders and the directors, officers, employees and agents.This disclaimer shall be governed by and construed in accordance with Cyprus law.

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