Looking into shipping’s future
THIRTY years or so ago, could you have predicted what shipping would look like in 2023? Perhaps you could. The climate change crisis might have been unexpected, but the industry has otherwise developed on the lines that were predictable in 1990.
In general, ships have become bigger and there has been massive consolidation. Size matters, especially in the container and cruise sectors. The crewing scene is much the same; if anything, it is now even more international than it was then. All of that was probably predictable.
Mind you, if you could go back to 1970, the situation would have been rather different. Although a few early-generation container ships were in operation, few realised just how much “box ships” would change the shipping world. It was still economically viable to operate steam turbine ships. Cruising was a small sideline for the passenger liner companies. National flag shipping lines were still the norm, though “flag-of-convenience” ships were making inroads. The traditional ship-owning companies still plied the same trades as they had for decades. The British India Steam Navigation Company, for example, still ran passenger ship services around the sub-continent.
Overall, the early 70s were like a different world, and I don’t remember many making accurate predictions of how things would change, or how quickly.
That cosy world fell off a cliff after the oil shocks. Massive change came almost unbelievably quickly.
So where are we now when it comes to predicting the future, in a 1970 or 1990 situation?
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Lloyd’s Register (LR) and Lloyd’s Register Foundation (LRF) have gone into the crystal ball business, commissioning a report, Global Maritime Trends 2050, from Economist Impact that analyses different future scenarios for shipping.
LR says that the research led to four feasible shipping futures that present both warnings and opportunities for our sector.
This is a heavyweight piece of work – the report is 63 pages long and is clearly the result of a huge amount of research work. It is certainly worth a read.
In assessing global trends for 2050, the report includes a literature review that aimed to explore how these might manifest in the near term (2030) and medium term (2040). The findings of the literature review were then discussed, scrutinised and validated by a team of international sectoral and methodological experts at Economist Impact and the Economist Intelligence Unit.
The trends identified by the literature review formed the basis of four possible maritime futures. The first, gradual transition, assumes high global cooperation combined with a gradual uptake of novel and/or advanced technology.
The second – rapid, tech-driven transition – would be steered by high global cooperation combined with a rapid uptake of novel and/or advanced technology.
The third is regionalised and fragmented transition, characterised by high global fragmentation combined with a rapid uptake of novel and/or advanced technology.
The fourth, delayed transition, would see high global fragmentation combined with a slow uptake of novel and/or advanced technology.
Personally I would put my money (say, 50 cents – my crystal ball is notoriously unreliable) on the third of these possible new worlds being the most accurate prediction. The world appears to have entered a long-term period of fractious relations between regional and ideological blocs. At the same time, localised production may become more economically viable, while technological advances are likely to continue at breakneck speed.
Perhaps to make the report a bit more interesting and less academic, Economist Impact identified four specific “what if” scenarios to bring each of these futures to life through qualitative, fictional storytelling. These are discussed in the report’s penultimate section.
The four scenarios are not predictions for 2050 based on quantitative modelling or forecasting. However, LR said: “Though fictional, the insights from these scenarios are grounded in the findings of our literature review, extensive desk research, and the 16 expert interviews. The aim of these scenarios was to understand the trends that would affect the maritime sector more broadly, as well as the specific implications for people, ports, trade, vessels and fuels.”
According to LR, the intention is to offer a window into a future that may manifest for the sector, and the efforts needed today by industry stakeholders to prepare.
The four scenarios explored are: what if nations embrace widespread adoption of green hydrogen by 2050?; what if automated technology solutions became widely adopted in the maritime industry by 2050?; what if regionalisation and population expansion lead to de-globalisation and fragmented global maritime trade by 2050?; and finally, what if average global sea levels rise by at least 40 centimetres by 2050?
LR said that one of the main takeaways from the report was that key global ports in the US, Europe and Asia could be unusable by 2050 without urgent action on decarbonisation. Also, African countries could become the dominant supplier of seafarers by 2050, while women could make up 25 per cent of all seafarers by 2050, against less than 2 per cent now.
The new report is intended to kick-start the launch of the wider multi-year LR and LRF Global Maritime Trends 2050 research programme. This will include a series of deep-dive reports by expert organisations commissioned to “examine what is needed to create a safe and sustainable maritime sector in the face of geopolitical, macroeconomic, technological and other societal shifts”.
This is a worthwhile and certainly ambitious project. It will be interesting to see if we can broadly predict the future, or if, as in 1970, we will become overwhelmed by “unknown unknowns”.
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