THE growth rate of ASEAN trade between China has been even stronger (54.4%), suggesting that China`s growing consumer power will provide a significant boost to this free trade agreement in the coming years. To underline the interest of the shipping industry in the free trade agreement, Hsieh said that in 2010, regular airlines introduced 26 new services connecting China to the ASEAN region. Hsieh said that for China, the lower costs of ASEAN imports help offset wage increases in China and maintain the competitiveness of Chinese exports. He also said this would reduce China`s consumer price index and ease inflationary pressures, which will help prolong the country`s economic growth. Intra-Asian trade has been a competitive path for decades, but competition has intensified in recent years as most long-distance firms try to capitalize on growth. American Shipper has documented this evolution each time over the past two years (see www.AmericanShipper.com/links). If we look at the 20 largest capacity providers in intra-Asian trade (Table 1), we see a mix of large regional airlines, small niche airlines and a multitude of subsidiaries backed by some of the world`s largest airline companies. According to research by the maritime intelligence service Alphaliner, the six most important lines of intra-Asian trade (defined as between the Far East and Southeast Asia) are among the largest in the world. Wan Hai, the largest supplier, is the exception in the top 6, as it has aggressively withdrawn from long-distance trade linking Asia to North America and Europe and has advocated a greater focus on intra-Asian trade. But the next five biggest `China Shipping, COSCO, Maersk Line, Evergreen and OOCL` are all the world`s major players.
“Of the top 10 (global) airlines, only hapag-Lloyd and CSAV have yet to develop significant intra-Asian feeder capabilities,” Alphaliner said in its November 1 newsletter. Hsieh said trade would see larger ship sizes, since East/West ships are cascading when dozens of large container ships are delivered to the global fleet. He indicated that there were already six intra-Asian services with two boats panamas from OOCL and one from MOL, China Shipping, COSCO and maersk subsidiary MCC Transport. “The largest vessels currently operating in intra-Asian trade are actually used in Chinese coastal trade, where ships trade between 4,000 and 5,100 TEUs for COSCO Container Lines and China Shipping and lesser the domestic market,” Alphaliner said. “The two Chinese airlines alone are expected to register 4.8 million TEUs in 2010, an annual growth of about 20% over 2009.” Alphaliner said the world`s major airlines are investigating the intra-Asian sector to absorb overcapacity, and cited the example that APL deployed three of its 3,500 TEU surplus vessels in a new China/Indonesia loop launched in November. “This is being boosted by the increase in volumes between China and ASEAN countries,” Alphaliner said.