dr. walter kemmsiesaapa.files.cms-plus.com/2018seminars/shifting/kemmsies... · 2018. 2. 7. ·...
TRANSCRIPT
The Changing Global Economy —
Impacts on Seaports and Trade
Dr. Walter KemmsiesChief Economist, PAGI Group, JLL
(Port, Airport & Global Infrastructure)
• Where are we in the cycle?
• What are the barriers to growth?
• What comes next?
Agenda
Source: Oxford, JLL 3
Best global economic environment in 20 years
0
50
100
150
200
250
300
Mar
-94
Feb-
95
Jan-
96
Dec
-96
Nov
-97
Oct
-98
Sep-
99
Aug
-00
Jul-0
1
Jun-
02
May
-03
Apr
-04
Mar
-05
Feb-
06
Jan-
07
Dec
-07
Nov
-08
Oct
-09
Sep-
10
Aug
-11
Jul-1
2
Jun-
13
May
-14
Apr
-15
Mar
-16
Feb-
17
Jan-
18
Dec
-18
Copper
Raw Materials
Agricultural
Oil
Steel
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
India
China
US
Brazil
Mexico
Eurozone
Japan
ANNUAL REAL GDP GROWTH 2001 – 2018(E) COMMODITY PRICES 1994 – 2018 (INDEXED TO 100 IN 2008)
Recovery, mid-cycle, recession?
2007 – 2016 was a “21st Century Great Depression”
Financial system has recovered
Europe had a “triple dip” recession
Public sector financial crisis has been stabilized
Inflation and growth risks are balanced
Central bankers everywhere not under pressure to increase interest rates
4
Where are we in the business cycle?
Differentials in ages is equivalent to differentials in growth
PROPORTION OF POPULATION OVER 55 YEARS OF AGE
Source: Census Bureau , Kemmsies
0%
10%
20%
30%
40%
50%
60%
1990 2000 2010 2020 2030 2040 2050
Japan
Europe
China
Canada
US
Brazil
Mexico
India
Typical maturing
developed economies
Highest growth
potential economies
Tight labor markets
High capacity utilization
Worsening congestion
Need infrastructure and plant, property and equipment investment to grow
Otherwise inflation could accelerate and induce central bankers to be aggressive
6
What are the barriers to growth?
Congestion is getting worse and ecommerce is growing
2020 congestion forecasts, with trucks
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1%
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3%
4%
5%
6%
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8%
9%
10%
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800
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99
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Shar
e o
f To
tal
$ B
illio
ns
Ecommerce Share (right axis) E-commerce Total
Source: US DOT, Census Bureau, JLL
eCommerce vs. total retail sales
Why is the inventory-to-sales ratio rising?
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1.1
1.2
1.3
1.4
1.5
1.6
1.7
1.8
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Inve
nto
ry-t
o-S
ale
s R
atio
Some theories:
• Lower interest rates means
capital tied up in inventories is
less expensive
• Ecommerce/omnichannel
means retailers hold more
inventory in more places
• Worsening congestion and
truck driver shortage requires
greater safety stocks
Inventory-to-sales ratio: 1992 - 2017
Inland hubs are becoming more numerous
Source: JLL Research
New US trade terms – ball is in trading partner’s court
Growth-oriented infrastructure policies
10
What comes next?
Trade growth trends underlie global economic growth
World real GDP and trade volume indexes 1950-2015E
Source: WTO, JLL
0
10
20
30
40
50
60
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80
90
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19
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56
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95
19
98
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01
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07
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13
20
16
Vo
lum
e In
dex
GDP Total Agriculture Fuels & Mining Manufactured
Japan,
Brazil
Korea,
Taiwan
China
Relative to GDP Growth
GDP 3.7% 1.0
Manufactured Goods 7.0% 1.9
Fuels and Mining Products 3.8% 1.0
Agricultural Goods 3.5% 1.0
Total Trade 5.8% 1.6
1950 - 2015 CAGR
Demographics Trade Agreements
Technology Infrastructure
Trade Growth
Resource Constraints
Trade growth drivers
International labor cost comparisons – then and now
Local manufacturing wages converted into us$ at prevailing exchange rates in 2001 and 2016
Source: Government statistics agencies, Trading Economics. JLL
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
The largest global middle class ever!World population and OECD global middle class projections
Source: OECD, US Census Bureau
1.8
3.0
3.8
4.6
5.4
6.9
7.3
7.6
8.08.3
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Bill
ion
s
Global Middle Class World Population
The trade deficit value gap
Goods trade deficit measured in us dollars: 2003 – 2016e
$0.00
$0.25
$0.50
$0.75
$1.00
$1.25
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Trill
ion
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Balance of Trade Value Import Value Export Value
Source: US Census Bureau
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Mill
ion
Met
ric
Ton
s
Balance of Trade Volume Import Volume Export Volume
Source: US Census Bureau
Goods trade deficit measured in metric tons: 2003 – 2016e
Summary: trade, congestion and infrastructure
• Rumors of the death of globalization are premature
– (More people, more consumption, more trade)
– (Ecommerce, 3D Printing, Automation is a reaction to congestion)
• Freight movement is suffering from congestion
– (Not enough roadway capacity)
– (Worsening truck driver shortage)
• The 3 T’s of Trump are creating opportunities to tap into global middle class growth
– (Trade agreements (NAFTA), Tax reform, Transportation infrastructure)
– (But the infrastructure market place is not waiting for Washington)
Mark Levy
+1 703 389 4203 [email protected]
Walter Kemmsies
+1 443 451 2607 [email protected]
Keith Stauber
+1 773 458 1386 [email protected]
Jonathan Walk
+1 202 531 6997 [email protected]
Steve Ostrowski
+1 773 458 1417 [email protected]
Michael Morehead
+1 443 804 9505 [email protected]
PAGI thanks you for your time
For more information contact one of our team members:
www.us.jll.com/pagi