After the collapse of Baltimore's Francis Scott Key Bridge this week, questions remain on the effect its absence will have on the city and regional and global supply chains.
Maryland Governor Wes Moore on Tuesday stressed the economic impact after the collapse, saying the port indirectly employs more than 100,000 people and imports about 51 million tonnes of foreign cargo.
More vehicles and agricultural equipment pass through Baltimore's port than any other in the US, Mr Moore said.
“Between $100 million and $200 million of value comes through port every day and about $2 million in wages are at stake every day and that's one of the areas we're most concerned about,” Transport Secretary Pete Buttigieg said on Wednesday.
The port is not the largest on the East Coast but it is closer to the Midwest region, known for its vehicle production, than any other and the ripple effects on the industry could last for months.
According to the Maryland government, it is the ninth largest US port for processing international cargo.
But experts say that while it is sure to have an effect on the economy of the city and the state, it is unlikely to have a large impact on the wider US economy.
“We don’t anticipate that the disruptions to trade or transportation will be visible in US GDP [gross domestic product], and the implications for inflation are minimal,” independent economic advisory company Oxford Economics said in a release.
It noted that while “there will likely be some temporary disruptions to certain industries, including auto makers”, they would probably do little to affect the overall economy.
“A prolonged disruption could lengthen delivery times more than we anticipate and enough to leave a mark on our US supply-chain stress index via the transportation or pricing components,” the report said.
Witnesses heard loud boom before ship struck bridge in Baltimore – video
The port has also become increasingly important to US retailers and manufacturers seeking to diversify their supply networks and bring goods closer to customers, Jonathan Gold, a vice president at the National Retail Federation, told AP.
“Everybody is trying to figure out the impact of the supply chain” from the loss of the bridge, said Mr Gold.
In addition to its importance to US trade, the Baltimore port is also key to international commerce. It is one of the biggest US ports for coal exports and also exports liquefied natural gas to Europe.
The bridge collapse is a “stark reminder” of the fragility of US infrastructure, said Christian Roeloffs, cofounder and chief executive of Container xChange, an online global container logistics platform.
“As we navigate the aftermath, we are reminded that the container logistics industry centres around the critical need for robust risk management and resilience in supply chain operations,” Mr Roeloffs said.
“This incident serves as a reminder that infrastructure vulnerabilities can lead to disruptions, and being prepared with flexible, adaptive strategies is essential for maintaining continuity in the face of challenges.”
Francis Scott Key Bridge collapse in Baltimore – in pictures
The incident comes amid rising pressure on the shipping industry as attacks by Yemen's Houthis continue to force ships to take longer routes around the Cape of Good Hope to avoid the Red Sea.
Most recently, at the weekend, a Chinese commercial ship crossing the area was hit by a barrage of Houthi missiles.
This, in addition to continuing bottlenecks in the Panama Canal, could lengthen delivery times and increase costs for companies.
“The pause in maritime traffic at the Port of Baltimore adds one more point of pressure for trade in the region,” Simona Stan, professor of marketing at the University of Montana, wrote in The Conversation.
“This may lead more shippers that have a choice to send more freight through West Coast ports, which have not suffered much from the Red Sea attacks and Panama problems.”
Unlike the Red Sea attacks and the Covid-19 pandemic, however, she projected the fallout from the bridge collapse will be temporary.
“From a supply chain perspective, this was a freak accident. It’s dramatic, it’s graphic, and it forces people to pay attention to the issue,” Ms Stan wrote.
At a glance
- 20,000 new jobs for Emiratis over three years
- Dh300 million set aside to train 18,000 jobseekers in new skills
- Managerial jobs in government restricted to Emiratis
- Emiratis to get priority for 160 types of job in private sector
- Portion of VAT revenues will fund more graduate programmes
- 8,000 Emirati graduates to do 6-12 month replacements in public or private sector on a Dh10,000 monthly wage - 40 per cent of which will be paid by government
UAE SQUAD
Goalkeepers: Ali Khaseif, Fahad Al Dhanhani, Mohammed Al Shamsi, Adel Al Hosani
Defenders: Bandar Al Ahbabi, Shaheen Abdulrahman, Walid Abbas, Mahmoud Khamis, Mohammed Barghash, Khalifa Al Hammadi, Hassan Al Mahrami, Yousef Jaber, Salem Rashid, Mohammed Al Attas, Alhassan Saleh
Midfielders: Ali Salmeen, Abdullah Ramadan, Abdullah Al Naqbi, Majed Hassan, Yahya Nader, Ahmed Barman, Abdullah Hamad, Khalfan Mubarak, Khalil Al Hammadi, Tahnoun Al Zaabi, Harib Abdallah, Mohammed Jumah, Yahya Al Ghassani
Forwards: Fabio De Lima, Caio Canedo, Ali Saleh, Ali Mabkhout, Sebastian Tagliabue, Zayed Al Ameri
If you go
Flights
Emirates flies from Dubai to Phnom Penh with a stop in Yangon from Dh3,075, and Etihad flies from Abu Dhabi to Phnom Penh with its partner Bangkok Airlines from Dh2,763. These trips take about nine hours each and both include taxes. From there, a road transfer takes at least four hours; airlines including KC Airlines (www.kcairlines.com) offer quick connecting flights from Phnom Penh to Sihanoukville from about $100 (Dh367) return including taxes. Air Asia, Malindo Air and Malaysian Airlines fly direct from Kuala Lumpur to Sihanoukville from $54 each way. Next year, direct flights are due to launch between Bangkok and Sihanoukville, which will cut the journey time by a third.
The stay
Rooms at Alila Villas Koh Russey (www.alilahotels.com/ kohrussey) cost from $385 per night including taxes.
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Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
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Honeymoonish
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Jumanji: The Next Level
Director: Jake Kasdan
Stars: Dwayne Johnson, Kevin Hart, Karen Gillan, Jack Black, Nick Jonas
Two out of five stars
The alternatives
• Founded in 2014, Telr is a payment aggregator and gateway with an office in Silicon Oasis. It’s e-commerce entry plan costs Dh349 monthly (plus VAT). QR codes direct customers to an online payment page and merchants can generate payments through messaging apps.
• Business Bay’s Pallapay claims 40,000-plus active merchants who can invoice customers and receive payment by card. Fees range from 1.99 per cent plus Dh1 per transaction depending on payment method and location, such as online or via UAE mobile.
• Tap started in May 2013 in Kuwait, allowing Middle East businesses to bill, accept, receive and make payments online “easier, faster and smoother” via goSell and goCollect. It supports more than 10,000 merchants. Monthly fees range from US$65-100, plus card charges of 2.75-3.75 per cent and Dh1.2 per sale.
• 2checkout’s “all-in-one payment gateway and merchant account” accepts payments in 200-plus markets for 2.4-3.9 per cent, plus a Dh1.2-Dh1.8 currency conversion charge. The US provider processes online shop and mobile transactions and has 17,000-plus active digital commerce users.
• PayPal is probably the best-known online goods payment method - usually used for eBay purchases - but can be used to receive funds, providing everyone’s signed up. Costs from 2.9 per cent plus Dh1.2 per transaction.
BMW M5 specs
Engine: 4.4-litre twin-turbo V-8 petrol enging with additional electric motor
Power: 727hp
Torque: 1,000Nm
Transmission: 8-speed auto
Fuel consumption: 10.6L/100km
On sale: Now
Price: From Dh650,000
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UAE currency: the story behind the money in your pockets
UAE currency: the story behind the money in your pockets
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UAE currency: the story behind the money in your pockets
Why seagrass matters
- Carbon sink: Seagrass sequesters carbon up to 35X faster than tropical rainforests
- Marine nursery: Crucial habitat for juvenile fish, crustations, and invertebrates
- Biodiversity: Support species like sea turtles, dugongs, and seabirds
- Coastal protection: Reduce erosion and improve water quality
F1 The Movie
Starring: Brad Pitt, Damson Idris, Kerry Condon, Javier Bardem
Director: Joseph Kosinski
Rating: 4/5
Anghami
Started: December 2011
Co-founders: Elie Habib, Eddy Maroun
Based: Beirut and Dubai
Sector: Entertainment
Size: 85 employees
Stage: Series C
Investors: MEVP, du, Mobily, MBC, Samena Capital
2019 Asian Cup final
Japan v Qatar
Friday, 6pm
Zayed Sports City Stadium, Abu Dhabi
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Other workplace saving schemes
- The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
- Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
- National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
- In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
- Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.
