This commentary appeared in the print edition of the Jan. 6, 2020, Journal of Commerce Annual Review and Outlook.
International trade in 2019 remained soft, with the 2008 international financial crisis yet to be fully shaken out of economies. Trade tensions that have been part of trade in many forms over the years were seen in a very different form in 2019 between two major economies, with a knock-on effect to all world economies at different levels and formats.
This simmering discord impacted across a variety of international governmental bodies seeking to provide rules-based guidance and governance in international trade.
Initiatives as to facilitation of international trade have moved from plurilateral to multilateral and more so to bilateral efforts. These many bilateral efforts, while striving to maintain common rules-based standards, end up with multiple standards, all of which dilutes transparency in general and, more importantly, for traders and service providers in international trade logistics and supply chain management that desire uniformity and consistency in regulatory intervention.
Loss of these key elements leads to inefficiencies, additional costs, loss of competitive position, and market dislocation, most of which has not been seen in the last 30 years of trade expansion. Throw in Brexit, and an added trade disruptor is on the horizon. All these issues impacted FIATA National Association and their respective business members during the year, and this created for all additional work without any increase in revenue.
Industry has also seen intervention by shipping lines in the traditional service offering of international freight forwarders through the vertical integration of carriage and border clearance of goods, and with some airlines seeing exporters as revenue opportunities and bypassing international air freight forwarders.
So, 2019 saw FIATA members face significant trade, regulatory, and business challenges. However, this industry sector is resilient and adaptive, and 2020 will be taken on with the same level of cautious optimism.