DETERMINANTS OF CONTAINER PORTS THROUGHPUT CONVERGENCE. A BUSINESS CYCLE SYNCHRONICITY ANALYSIS

The recent economic recession of 2009 had a significant 'knock-on' effect on container shipping causing a remarkable decline of TEU's handled in seaports on a world scale. This is primarily attributed to the slump in the global economy. The fortunes of the container shipping sector (and hence ports) coincide almost directly with global trade developments. Empirical studies aiming to interpret the relationship of container ports throughput, macro economic and, shipping developments remain quite limited. The present study builds on the well-established theory of business cycle synchronicity, which takes into account the macroeconomic co-movements of the contemporary globalized economic environment. This study strives to generate knowledge on the extent that major macroeconomic (such as GDP, industrial production, bilateral trade and financial openness) and shipping (fleet development and transportation cost) variables, affect container ports throughput. In addition the study employs a panel data analysis and uses dynamic Generalized Methods of Moments (GMM) techniques to reach meaningful conclusions. The sample covers a period of sixteen years (1995-2010) and includes 36 ports from 25 countries. Moreover, typical market structures were isolated and tested in detail.