Global trade, also known as international trade is the exchange of goods and services across borders. The correlation between the shipping industry and global trade work hand-in-hand with each other on many levels. While there are other ways to ship cargoes, you can agree with me and empirical data that most cargoes are transported via sea, which makes both variables (ships and cargoes) interdependent on each other. The International Chamber of Shipping posits that “some 11 billion tons of goods are transported by ships each year. This is an impressive 1.5 tons per person based on the current global population. Shipping’s capacity to transfer goods and materials from where they are produced to where they are ultimately consumed underpins modern life”. With the above mentioned facts, shipping contributes immensely to a country’s economic stability, and is paramount in all instances.
Cargoes are transported via several modes. However, the shipping mode is mostly utilized, especially for big companies who order and ship goods for commercial purposes. Moreover, it is the cheapest of all the other modes. When shipping in bulk to sell to consumers for final consumption, it is imperative that items are sold at a reasonable cost to compete within the global market, the items cannot be excessively priced, or customers will not be motivated to purchase and will find the next best alternative. International trade and ships come into play because if countries fail to give or trade commodities with each other, the ships and the shipping industry would become redundant. Additionally, the prices for several items will increase drastically, even more so if a country does not produce the good.
As mentioned in the introduction, the shipping industry contributes to a country’s economy. Without this industry, the world would encounter a global recession, and the level or hunger and starvation would increase. One would probably think that trains, trucks and planes could easily replace and maneuver what ships do, but that is highly unlikely, expensive and time consuming. Now that we are able to analyze and understand the correlation between the shipping industry and international trade, we should make every effort to ensure that the shipping sector is properly invested in, and continue to strengthen global trade, while building long-lasting relationships with trading countries.