SEOUL, Sept. 28 (Yonhap) — South Korea’s global competitiveness in the transport service sector has dropped sharply over the past 10 years due mainly to a tumble in maritime service exports, a report said Monday.
South Korea ranked 11th in the world in terms of transport service exports in 2019, down from fifth in 2010, according to the report from the Korea International Trade Association (KITA).
South Korea’s exports of transport services accounted for 2.6 percent of the world total last year, also down from 4.7 percent in 2010.
The report attributed the plunge in South Korea’s competitive edge to a sharp drop in local shipping lines’ share of major routes across the world.
“Global shipping companies have been trying to expand their presence and competitiveness through mergers and acquisitions, and alliances, but local players have been struggling to cope with a falling market share since 2017,” it said.
Hanjin Shipping Co., once the world’s seventh-largest shipper, went belly-up in early 2017, dealing a fatal blow to the domestic shipping industry.
Recently, the local logistics industry is faced with difficulties due to a spike in freight rates, which stems from a recovery in global trade volume, and other unfavorable factors, according to industry sources.
The China Containerized Freight Index, a barometer of global freight rates, came to 949.48 as of Sept. 11, up 3 percent from the previous week and much higher than last year’s average of 823.53.
In addition, major global shipping lines are allocating more container vessels to China to meet growing demand there, so South Korean exporters are having a hard time securing ships, the sources said.