A monopoly could be the solution for container shipping

AT one time, and until quite recently in fact, the idea of Singapore letting go of Neptune Orient Lines (NOL) would have been unthinkable. But that is what is happening now, with French container giant CMA CGM paying S$3.4 billion for NOL and it is the right thing to do - at least from Singapore's perspective. Whether it will do CMA CGM any good in the long run is quite another question.

NOL chief executive Ng Yat Chung has been widely reported as saying that Singapore outgrew NOL a long time ago and again that is absolutely right. In aviation the concept of the national carrier survives, with some thriving and others struggling. Shipping is different. It has always been different from aviation and shipping in 2016 is very different from shipping in 1968 when NOL was set up.

Most of the big liner companies of that time have long since disappeared. They thrived in the days before containerisation when the "liner conference system" ruled the general cargo business. Liner conferences were essentially cartels which fixed freight rates according to the value of the cargo carried.