Singapore’s Minister for Transport, Chee Hong Tat, recently addressed the audience at the recent “Leadership Insights Live Event”, held by the International Chamber of Shipping. Singapore is home to one of the world’s busiest container-focused seaports.
He noted that the World Trade Organization recorded global merchandise trade as falling by 5.3% in 2020, the 2021 forecast is for an increase of 8% and that further boosts are expected as the “global economy recovers and international trade rebounds”.
Minister Chee spoke on the subject of supply chain stability and noted that shipping has been resilient throughout COVID-19. He also spoke of “lessons learned”.
“The shipping industry must act swiftly to tackle the disruption to global supply chains due to port congestion and shortage of containers, as well as incidents such as the Suez Canal blockage in late March this year,” he told the audience [emphasis added].
Minister Chee noted that customers have been badly affected by an inadequate supply of sea freight due to prolonged vessel delays caused by port-related congestion. He also noted that freight rates are “sky-high”.
“The shipping and port industry must take decisive actions to re-establish the reliability and cost-effectiveness of sea freight as the main mode of connectivity for global trade. The congestion must be cleared up so the world economy can breathe again.”
He then went on to point to action already underway by the shipping industry to tackle these issues with container carriers buying new containers and new container ships.
Minister Chee also pointed to actions taken by the Port of Singapore which has opened more berths, and is using more equipment to help reduce delays.
Finally, Minister Chee questioned the “just-in-time” supply chain model. He raised the issue that companies might want to consider moving from a “just-in-time” model of inventory management. He suggest that there could be a hybrid model, balancing “just-in-time” with “just-in-case”.
Read the “round-up” of the event held by the International Chamber of Shipping here.