China's disappearing ships: The latest headache for the global supply chain

Discussion in 'Economics' started by themickey, Nov 24, 2021.

  1. themickey

    China's disappearing ships: The latest headache for the global supply chain
    Analysis by Laura He, CNN Business
    November 24, 2021

    Hong Kong (CNN Business)Ships in Chinese waters are disappearing from global trackers, creating yet another headache for the global supply chain. China's growing isolation from the rest of the world — along with a deepening mistrust of foreign influence — may be to blame.

    Analysts say they started noticing the drop-off in shipping traffic toward the end of October, as China prepared to enact legislation governing data privacy.

    Usually, shipping data companies are able to track ships worldwide because they are fitted with an Automatic Identification System, or AIS, transceiver.
    This system allows ships to send information — such as position, speed, course and name — to stations that are based along coastlines using high-frequency radio. If a ship is out of range of those stations, the information can be exchanged via satellite.
    But that's not happening in the world's second-largest economy, a critical player in global trade. In the past three weeks, the number of vessels sending signals from the country has plunged by nearly 90%, according to data from the global shipping data provider VesselsValue.

    "We are currently seeing an industry wide reduction in terrestrial AIS signals in China," said Charlotte Cook, head trade analyst at VesselsValue.
    A cargo ship seen at Yangshan Deepwater Port in Shanghai last October. Shipping data companies say they've lost information about ships in Chinese waters in recent weeks.

    New data law could worsen supply chain chaos
    Asked about the issue, China's Ministry of Foreign Affairs declined to comment. The State Council Information Office, which acts as a press office for the country's cabinet, did not immediately respond to a request for comment about why shipping providers were losing access to data.

    But analysts think they've found the culprit: China's Personal Information Protection Law, which took effect November 1. It requires companies that process data to receive approval from the Chinese government before they can let personal information leave Chinese soil — a rule that reflects the fear in Beijing that such data could end up in the hands of foreign governments.

    The law doesn't mention shipping data. But Chinese data providers might be withholding information as a precaution, according to Anastassis Touros, AIS network team leader at Marine Traffic, a major ship-tracking information provider.
    "Whenever you have a new law, we have a time period where everyone needs to check out if things are okay, "Touros said.

    Other industry experts have more clues of the law's influence. Cook said that colleagues in China told her that some AIS transponders were removed from stations based along Chinese coastlines at the start of the month, at the instruction of national security authorities. The only systems allowed to remain needed to be installed by "qualified parties."

    Not all of the data is gone: Satellites can still be used to capture signals from ships. But Touros said that when a ship is close to shore, the information collected in space is not as good as what can be gathered on the ground.
    "We need terrestrial stations in order to have a better picture, a more high-quality picture," he added.

    With Christmas approaching, a loss of information from mainland China — home to six of the world's 10 busiest container ports — could create more problems for an already troubled global shipping industry. Supply chains have been under strain this year as badly congested ports struggle to keep up with a rapidly rebounding demand for goods.

    Shipping firms rely on AIS data to predict vessel movement, track seasonal trends and improve port efficiency, according to Cook from VesselsValue. She said the lack of Chinese data "could significantly impact ocean supply chain visibility across China." The country is one of the world's major importers of coal and iron ore, as well as a huge exporter of containers.

    "As we move into the Christmas period, it will have a really big impact on [supply chains] and this is the most important element right now," said Georgios Hatzimanolis, media strategist for Marine Traffic. He expects the loss of "minute by minute" ship data from China to have "a great impact on the supply chain," since companies may lose crucial information about ship docking, unloading and leaving times.

    The global supply chain is already under "great stress," he added. "It doesn't need another factor to make it more difficult."
    Ningbo-Zhoushan Port as seen in August. Experts worry that a lack of shipping data out of China could strain the global supply chain.

    China's self-isolation
    China's desire to retain absolute control over all data and information within its borders isn't surprising, as President Xi Jinping continues to reassert the ruling Communist Party's dominance in every aspect of the economy and society.
    The country has been pushing for economic self-sufficiency as it faces external threats, such as US sanctions on key technologies.

    Xi emphasized his self-reliance goals in the years before and during a bitter trade and tech war with former US President Donald Trump. That's the point, for example, of "Made in China 2025," an ambitious plan to push China's manufacturing sector into more advanced technological fields.
    China's biggest private companies are in chaos. It's all part of Beijing's plan

    Some top officials in Beijing have recently tried to quell concerns among global investors that the country is isolating itself from the rest of the world as it prioritizes national security.
    Chinese Vice President Wang Qishan, considered a trusted ally of Xi, told the Bloomberg New Economy Forum in Singapore that China would not "develop isolated from the world." Speaking via video, he also called on countries to keep supply chains "stable and smooth."
    But China has embraced policies during the coronavirus pandemic that often appear to do otherwise.

    For example, during the pandemic Xi has doubled down on his push for self-reliance, stressing the need to create "independent and controllable" supply chains to ensure national security.

    And the country's sweeping clampdown on tech extended this summer to foreign IPOs, when the Cyberspace Administration of China proposed that major companies with more than a million customers seek approval before listing shares overseas. As with the recent data privacy law, the agency cited concerns about whether personal data held by those companies could be exploited by foreign governments.

    China's actions this year may come at a cost, though, if the country goes too far in its attempt to protect itself from perceived foreign interference.
    "If China is serious about promoting transparency, reconnecting or remaining connected with the world ... then they have absolutely no reasons to be creating regulations that are going to limit this data coming out," said Marine Traffic's Hatzimanolis, referring to the shipping data. "If we don't have visibility of when ships arrived in China and when leaving ... the whole supply chain becomes further fragmented."
    -- CNN's Beijing bureau contributed to this report.
  2. VicBee


    Can't put my finger on it yet, but something is a little fishy about this story
  3. JSOP


    So are the ships still leaving/arriving China just without transmitting AIS signals or are there really no ships at all? If it's the latter, well that's what the West wants, diversifying away from China in terms of supply chain providers. If it's the former, then it's a little weird. Why would China want to all of sudden mask their ships' signals and obscure their paths? This does not make any sense.
  4. thecoder


    It could be similar to the new supercomputer installations in China: China has stopped to report its newest supercomputers and which companies were involved in it, b/c of fears that the makers and supplier companies of these supercomputers could be sanctioned by the US of Arseica accusing them helping the PLA, ie. the Chinese military... :) Those braindamaged sickos in Washington don't know what they do and cause!...
  5. thecoder


    China has 2 possibilities, or options:
    1) become a more cheaper producer, OR
    2) let the others, ie. it's buying clients, become more expensive producers and consumers themselves
    It seems currently option 2 gets applied somehow, ie. by somehow disturbing/manipulating the supply chains... :)

    Resource scarcity everywhere in the industry, economic shortages, energy shortages (electricity, oil, gas);
    the dream of the so-called liberal libtard greenwashed utopian anti-privacy socialist communist sicko woke idiots becomes true.
    The dying West gets what it deserves, IMO... Best answer by China as response to the unfair sanctions and the economic & technological discrimination done by the US of Arseica...
    And I'm for sure not implying that China is the best... solution.
    Last edited: Nov 24, 2021
  6. Nobert


    Just a guess, - when shit hits the fence, ones logistic supply actions less visible.
    (maybe just by 10%, but 10% overall, beats the hell out of a zero)

  7. themickey


  8. JSOP


    So they mask their own "data" while go out and hack into other countrys' systems to get their data? Nice
  9. JSOP


    Ok so they want to build a secret "One Belt One Road" without us knowing? LOL So why don't they just tunnel it underground or transport everything using submarines? LOL
  10. thecoder


    Sorry, I don't know what you are talking about, JSOP.
    What has the BRI to do with this topic?
    Same with your other posting about "data" and "hacking".
    #10     Nov 24, 2021