The paper "The Impact of Global Recession and Europe Debt Crisis in Shipping and Ship Breaking Industries" is a great example of macro & microeconomics coursework. It is quite evident that 90% of world trade is largely carried out by the international shipping industry. With no shipping, today the modern world would suffer especially in exporting and importing. In today world economy, the shipping industry is rapidly growing assisting in decreasing freight costs while at the same time increasing shipping efficiency. With the great help in economic liberalization as well as industrialization it is expected that the shipping industry will grow.
It is for this reason that this paper focuses on identifying the key indicators that one can use to evaluate the performance of shipping companies. Further, the paper will discuss why shipping companies should only have new ships and finally, the paper will discuss how the declines in the world economy and trade as a result of the on-going European debt crisis would affect the sea freight market in the short term and in the long term. 2.0 Key indicators within the shipping industry Heaver et al (2000) suggest that the shipping company is considered to be subject to changes in both expectations and requirements from customers, employees, government, the public and other stakeholders.
Evidently, within the shipping industry, there is a drive towards more transparency and visibility in operations. According to Meersman and Vanelslander (2003), due to the constant change in information technology as well as the business operation environment, shipping industries are facing serious competition. It is for this reason that shipping companies need to have the good operating performance to ensure they are engaging in successful business (Heaver et al, 2000).
Lorange (2001) maintains that the two key indicators within the shipping industry are financial and operational indicators. It is important for shipping companies should be aware of the costs generated by its operations and the revenue collected from these operations. The trend, even in those countries where shipping companies are not treated as sovereign within the national economy, is towards making them increasingly financially feasible. It is therefore important for shipping companies to provide sound financial information (Lorange, 2001).
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