Evergreen’s Bronson Hsieh Addresses FIATA’s World Congress

Bronson Hsieh, Second Vice Group Chairman of the Evergreen Group, delivered the keynote speech at the FIATA World Congress 2015 in Taipei. He talked about a slow but upward development of the global economic recovery, different trends in the container shipping and air freight markets as well as the opportunities for logistics service providers brought about by growing cross-border e-commerce. To start, Mr. Hsieh quoted IMF (International Monetary Fund) forecasts that imply that the world economic outlook is experiencing a slow but upward development in spite of some regional variations. In addition, he noted several free trade agreements have begun to take shape in recent years, such as TPP (Trans-Pacific Partnership), RCEP (Regional Comprehensive Economic Partnership) and TTIP (Transatlantic Trade and Investment Partnership).

Once established, these economic cooperation agreements will remove trade barriers and thereby accelerate growth of international trade and cargo flows. Next, Hsieh analysed major trends in the container shipping market. “The current trend in vessel upsizing is to benefit from the scale economics that large vessels afford by reducing unit cost,” he said. However, to effectively produce the expected cost benefits, Ultra-Large Container Ships have to be sufficiently loaded. Carriers are thus motivated to join alliances and work with other members to raise capacity utilization on these big ships. After its expansion project is completed in 2016, the Panama Canal will be able to handle new ‘Panamax’ vessels of around 12,000-teu ships, causing a fundamental shift in U.S. supply chains and cargo movement patterns. To prepare for the large vessels and cargo flows attracted to the expanded Panama Canal, several ports on the U.S. east coast are deepening channels and enlarging their facilities, added Hsieh.