THE China-dependent shipping market will gradually move from export to import volumes, but affect overall tonnage "very little", according to JP Morgan global market chairman Jing Ulrich, speaking to the American Chamber of Commerce in Hong Kong.
While direct exports from China are slowing, this will be compensated by increasing imports as domestic consumption, together with fixed asset investment growth, grows to be 25 per cent of GDP, she said.
This will be the main driver of the Chinese economy in the coming years, but affect the shipping industry "very little" in terms of overall volume, said Ms Ulrich.
"The Chinese economy has changed from being export-dependent to one of domestic growth. There is a massive under-utilisation of infrastructure and the challenge will be to create domestic consumption to take full advantage of such available infrastructure," said the AmCham press release paraphrasing her talk.
Ms Ulrich said China's economy would surpass that of the US by 2020, and by 2025, some 60 per cent of China's population (780 million people) would be middle class, with a mean income of US$20,000 per person. More disposable income means more demand for luxury goods - and imports - and continuing increase in domestic consumption.
"In our opinion, a good sign that China will continue to drive the markets as the biggest market in the world - and regardless of whether export or import driven .. ships will continue to be a necessity with the biggest challenge being the type and size of ships to invest in for the future," she said.
These the questions that will be addressed at next year's Business of Shipping conference to be held on March 1 at the Renaissance Harbour View hotel in Hong Kong during Shipping Hong Kong Week.