Empty boxes and global trade

Two summers ago, I reviewed The Box for the Professional Geographer. The book was authored by Marc Levinson, who worked for the Economist at one point. In the book, Levinson argues that the box--the shipping container--catalyzed global trade and economic growth.

About the same time as my book review was published, James Fallows had a fantastic piece on the Pearl River Delta of Guandong Province in China. In that, Fallows wrote:

From the major ports serving the area, Hong Kong and Shenzhen harbors, cargo ships left last year carrying the equivalent of more than 40 million of the standard 20-foot-long metal containers that end up on trucks or railroad cars. That’s one per second, round the clock and year-round—and it’s less than half of China’s export total.

That was then when exports and global trade were booming like never before. And then came the Great Recession. How much have things changed? Here is the Economist:

But by November exports were worth 17.3% less than a year earlier, before slumping by a whopping 32.6% in the year to January. In March the managers of South Korea’s Busan port, long one of the world’s busiest, said that it had run out of space to store nearly 32,000 empty containers. The Baltic Dry Index, which measures demand for the ships that transport bulk goods such as iron ore or coal, fell from 11,793 at the end of May last year to a pitiful 663 in early December.
Estimates by the World Trade Organisation suggest that trade volumes will shrink by around a tenth this year.

Interestingly enough, Fallows and this Economist piece have shipping containers for illustration. Very different stories though!

Anyway, what might the story of global trade look like? The Economist seems confident that we have bottomed-out. However,

More people out of work will mean a further fall in global demand. China's boom (GDP grew by 7.9% in the second quarter) is fuelled by government investment and by the stimulus, not a rise in private consumption. Nor are other consumers stepping in. Without a move towards more private consumption in countries such as Germany and China, the world is in for a prolonged period of slow growth and correspondingly sluggish trade.