Vessels Call To Nigerian Seaports Drop As Global Recession Looms Over Coronavirus

Abiola Seun

The world is expected to undergo another global economic meltdown as deadly coronavirus and heightening geo-political and trade tensions is expected to drive the world to the brink of a global recession this year.

This is even as vessels call into the Nigerian seaports have reduced significantly due to fear of the spread of the virus.

But, in a statement yesterday by Nigel Green, founder and CEO of deVere Group, one of the world’s largest independent financial services and advisory organizations, he warned that investors must take action sooner rather than later to build and safeguard their wealth.

According to him, the recession would be severe because Central Banks around the world are running out of weapons to see off the threats.

The warning comes as Asian-Pacific, European stocks and U.S. futures fell on Wednesday as the global market sell-off triggered by concerns over the impact of the coronavirus outbreak grew.

Mr Green said: “Investors have largely been caught off-guard by the serious and far-reaching economic consequence of the coronavirus.

“This, despite major multinational organisations already lowering their profit guidance, and many more likely to do so in coming weeks. Clearly, this will hit global supply chains, economies across the world and ultimately government coffers too.

“However, it does seem that this week the world is waking up to the reality of the situation as the containment of coronavirus hasn’t yet materialised and confirmed cases soar in different countries. Until such time as governments pump liquidity into the markets and coronavirus cases peak, markets will be jittery triggering sell-offs,” he added.

Also earlier this week, Nigel Green noted in addition, coronavirus has struck at a time when major economies, including Japan, Germany, India and Hong Kong are already facing a serious downturn.

He continues: “It doesn’t end there. Investors also need to consider the impact of the U.S. presidential election, the tensions between Iran and the U.S. and how oil prices will be hit if these intensify, and perhaps most significantly there’s the simmering trade war between the U.S. and China – the world’s two largest economies.

“China’s current economic slowdown will reduce the country’s ability to buy $200 billion more U.S. goods, as promised in the Phase One trade deal. And that was the ‘easy’ bit.

“Phase Two is more about the U.S. trying to limit China’s tech ambitions and it has been reported that Beijing is unwilling to negotiate on many of these issues, and instead would play for time.”

The deVere CEO goes on to add: “The combination of these headwinds is likely to dampen business confidence and investment, profits, and consumer demand throughout the rest of this year. Together they could push the world to the brink of a global recession this year. This would be severe because central banks are running out of weapons to see off the threats.”

Mr Green concludes: “Whilst I am confident that we’ll narrowly avoid a global recession in 2020, no-one can accurately predict the future as we have seen with coronavirus, which markets wrongly assumed would be limited to mainly China.

“Therefore, in the current volatile environment, investors – including myself – will be revising their portfolios and drip-feeding new money into the market to take advantage of the opportunities whilst reducing risk at the same time.”

On reduction of vessels to Nigerian ports, experts in the Nigerian maritime sector said that Nigeria would be losing about N1 billion daily to the outbreak of the Coronavirus as the level of imports arriving Nigerian ports is gradually dropping while port calls to China are becoming less frequent.

This was as a result of fear of contacting the disease and a slowdown in the Chinese economy have deterred cruise liners, container ships, oil tankers and bulk carriers alike from stopping at the nation’s harbours.

Commercial vessels have stopped arriving, with port calls falling by an estimated 30 per cent in February, and container throughput estimated to decline by between 20 and 30 per cent, according to Clarksons, a shipping research company.

However, with more than 50 per cent of Nigeria Import coming from China, many of Nigerian importers are now afraid to take cargoes from china, even as millions who usually travel during this period are cancelling their trips.

Conversely, stakeholders described the Coronavirus as a very big blow to Nigeria economy, because most of Nigeria imports are from China, Hong Kong and presently people are scared to take any consignment from China.