If proof of an East-West split in liner shipping were needed, then Cosco Shipping Holdings perhaps helps to provide it.
The Chinese container shipping giant is celebrating its best-ever results with annual profit up by more than 26% to a staggering CNY 131.4bn ($19.2bn) for 2022.
Some 50% of the profit attributable to shareholders will be paid out in the form of a chunky $7.9bn cash dividend.
That will benefit China Cosco Shipping, the giant state-owned group that is its majority shareholder.
Looking forward to 2023, however, the company warned that “the external environment will become more complex and challenging”.
Yet unlike most Western liner groups, Cosco Shipping Holdings made no mention of the impact of Russia’s invasion of Ukraine in its annual results.
Even its Ocean Alliance partner CMA CGM referred to the impact of the war on the French liner giant’s results just two weeks earlier.
But the Cosco unit blamed “geographical tensions, high inflation and tightening monetary policies adopted by European countries and America”.
The company added that these will “pose challenges to global economic development and commodity trade”.
The Shanghai and Hong Kong-listed unit highlighted long-term issues, including slow down in demand growth.
Eyes on China
Cosco Shipping Holdings fears liner operators face “the practical challenge of intensified industrial competition and increased supply of transportation capacity”.
The company suggests that its container shipping operation should look to China for salvation in what could otherwise be a difficult year.
“China’s proactive measures to promote economic recovery, further reform and opening up will contribute to the recovery of the world economy and formation of a more open, diversified and stable world economy order,” the outfit said.
The company added that it will be “seizing the opportunity of China’s economic recovery to continuously services [sic] for emerging markets, regional markets, and the third-country markets”.
Cosco Shipping Holdings has reaped billions of dollars from its dual container brands.
These are wholly owned Cosco Shipping Lines and Orient Overseas Container Line, which it controls through holding subsidiary Orient Overseas International.
The container division, which controls a fleet of 489 ships with a capacity of 2.89m teu, proved the star performer with profit of CNY 136bn.
This helped group revenue rise to CNY 391bn, up 17% compared with the previous year.
The company also controls Cosco Shipping Ports, which operates a total of 220 container berths at 36 ports worldwide.
