China’s Growth Creates a Boom for Cargo Ships

The world's cargo ships are heavily laden and busily transporting goods around the globe, but largely to or from China. Two years ago, many of these ships could be found lying idle in their home ports. Now, thanks to China's rapidly expanding economy, shipping lines are enjoying one of their most profitable booms ever. China is not only importing huge quantities of raw materials from countries around the world, but its factories are transforming these materials into finished products – such as furniture, electronics, and toys – that must be shipped to markets in Europe and America. Cargo ships are therefore perpetually circumnavigating the globe, causing daily charter rates to triple since last year. The sudden prosperity of these shipping lines illustrates how a large global industry can become dependent on the Chinese economy in just a few years. Indeed, some analysts worry that many global industries – in addition to shipping lines – are too dependent on China, and may be vulnerable to the frequent fluctuations of the Chinese economy. For better or worse, however, the words of one shipping company executive are increasingly true for industries around the globe: "Everything comes back to how China is growing." – YaleGlobal