How Francis Scott Key Bridge collapse could affect US economy and global trade


Sara Ruthven
  • English
  • Arabic

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

  • A satellite image of the Dali container ship and sections of the collapsed Francis Scott Key Bridge in Baltimore, Maryland. Reuters
    A satellite image of the Dali container ship and sections of the collapsed Francis Scott Key Bridge in Baltimore, Maryland. Reuters
  • People gather for a vigil at Mount Olive Baptist Church in Dundalk, Maryland. AP
    People gather for a vigil at Mount Olive Baptist Church in Dundalk, Maryland. AP
  • The Dali cargo ship ran into the bridge, leading to its collapse on March 26. AFP
    The Dali cargo ship ran into the bridge, leading to its collapse on March 26. AFP
  • News crews and residents gather along the shoreline. Rescuers pulled two people from the Patapsco River but were searching for at least seven more. AFP
    News crews and residents gather along the shoreline. Rescuers pulled two people from the Patapsco River but were searching for at least seven more. AFP
  • Jesus Campos speaks about the work he and his co-workers normally do to repair the Francis Scott Key Bridge. AFP
    Jesus Campos speaks about the work he and his co-workers normally do to repair the Francis Scott Key Bridge. AFP
  • Mr Scott, centre, hugs an attendee during a vigil for victims of the bridge collapse at the Mount Olive Baptist Church in Baltimore. AFP
    Mr Scott, centre, hugs an attendee during a vigil for victims of the bridge collapse at the Mount Olive Baptist Church in Baltimore. AFP
  • Baltimore Police commissioner Richard Worley, centre, Mayor Brandon Scott, right, and Fire Department chief James Wallace hold a press conference. AFP
    Baltimore Police commissioner Richard Worley, centre, Mayor Brandon Scott, right, and Fire Department chief James Wallace hold a press conference. AFP
  • Rescuers gather on the shore of the Patapsco River for an operation authorities described as a 'mass casualty, multi-agency rescue'. EPA
    Rescuers gather on the shore of the Patapsco River for an operation authorities described as a 'mass casualty, multi-agency rescue'. EPA
  • Motorway alerts warn drivers about the incident in Baltimore. Reuters
    Motorway alerts warn drivers about the incident in Baltimore. Reuters
  • A number of workers were carrying out repairs when the Dali hit the bridge. Bloomberg
    A number of workers were carrying out repairs when the Dali hit the bridge. Bloomberg
  • The bridge collapsed on top of the vessel. EPA
    The bridge collapsed on top of the vessel. EPA
  • A large lorry was crossing the bridge when it collapsed, fire department officials said. Reuters
    A large lorry was crossing the bridge when it collapsed, fire department officials said. Reuters
  • The Francis Scott Key Bridge was the world's third-longest continuous truss bridge. Getty Images
    The Francis Scott Key Bridge was the world's third-longest continuous truss bridge. Getty Images

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.

UAE currency: the story behind the money in your pockets
Company%20profile
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Avatar: Fire and Ash

Director: James Cameron

Starring: Sam Worthington, Sigourney Weaver, Zoe Saldana

Rating: 4.5/5

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Silent Hill f

Publisher: Konami

Platforms: PlayStation 5, Xbox Series X/S, PC

Rating: 4.5/5

Find the right policy for you

Don’t wait until the week you fly to sign up for insurance – get it when you book your trip. Insurance covers you for cancellation and anything else that can go wrong before you leave.

Some insurers, such as World Nomads, allow you to book once you are travelling – but, as Mr Mohammed found out, pre-existing medical conditions are not covered.

Check your credit card before booking insurance to see if you have any travel insurance as a benefit – most UAE banks, such as Emirates NBD, First Abu Dhabi Bank and Abu Dhabi Islamic Bank, have cards that throw in insurance as part of their package. But read the fine print – they may only cover emergencies while you’re travelling, not cancellation before a trip.

Pre-existing medical conditions such as a heart condition, diabetes, epilepsy and even asthma may not be included as standard. Again, check the terms, exclusions and limitations of any insurance carefully.

If you want trip cancellation or curtailment, baggage loss or delay covered, you may need a higher-grade plan, says Ambareen Musa of Souqalmal.com. Decide how much coverage you need for emergency medical expenses or personal liability. Premium insurance packages give up to $1 million (Dh3.7m) in each category, Ms Musa adds.

Don’t wait for days to call your insurer if you need to make a claim. You may be required to notify them within 72 hours. Gather together all receipts, emails and reports to prove that you paid for something, that you didn’t use it and that you did not get reimbursed.

Finally, consider optional extras you may need, says Sarah Pickford of Travel Counsellors, such as a winter sports holiday. Also ensure all individuals can travel independently on that cover, she adds. And remember: “Cheap isn’t necessarily best.”

The biog

Family: Parents and four sisters

Education: Bachelor’s degree in business management and marketing at American University of Sharjah

A self-confessed foodie, she enjoys trying out new cuisines, her current favourite is the poke superfood bowls

Likes reading: autobiographies and fiction

Favourite holiday destination: Italy

Posts information about challenges, events, runs in other emirates on the group's Instagram account @Anagowrunning

Has created a database of Emirati and GCC sportspeople on Instagram @abeermk, highlight: Athletes

Apart from training, also talks to women about nutrition, healthy lifestyle, diabetes, cholesterol, blood pressure

Ferrari 12Cilindri specs

Engine: naturally aspirated 6.5-liter V12

Power: 819hp

Torque: 678Nm at 7,250rpm

Price: From Dh1,700,000

Available: Now

Director: Laxman Utekar

Cast: Vicky Kaushal, Akshaye Khanna, Diana Penty, Vineet Kumar Singh, Rashmika Mandanna

Rating: 1/5

Skoda Superb Specs

Engine: 2-litre TSI petrol

Power: 190hp

Torque: 320Nm

Price: From Dh147,000

Available: Now

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COMPANY%20PROFILE
%3Cp%3E%3Cstrong%3EName%3A%20%3C%2Fstrong%3EQureos%0D%3Cbr%3E%3Cstrong%3EBased%3A%20%3C%2Fstrong%3EUAE%0D%3Cbr%3E%3Cstrong%3ELaunch%20year%3A%20%3C%2Fstrong%3E2021%0D%3Cbr%3E%3Cstrong%3ENumber%20of%20employees%3A%20%3C%2Fstrong%3E33%0D%3Cbr%3E%3Cstrong%3ESector%3A%20%3C%2Fstrong%3ESoftware%20and%20technology%0D%3Cbr%3E%3Cstrong%3EFunding%3A%20%3C%2Fstrong%3E%243%20million%0D%3Cbr%3E%3C%2Fp%3E%0A
Match info

What: Fifa Club World Cup play-off
Who: Al Ain v Team Wellington
Where: Hazza bin Zayed Stadium, Al Ain
When: Wednesday, kick off 7.30pm

How the bonus system works

The two riders are among several riders in the UAE to receive the top payment of £10,000 under the Thank You Fund of £16 million (Dh80m), which was announced in conjunction with Deliveroo's £8 billion (Dh40bn) stock market listing earlier this year.

The £10,000 (Dh50,000) payment is made to those riders who have completed the highest number of orders in each market.

There are also riders who will receive payments of £1,000 (Dh5,000) and £500 (Dh2,500).

All riders who have worked with Deliveroo for at least one year and completed 2,000 orders will receive £200 (Dh1,000), the company said when it announced the scheme.

How the UAE gratuity payment is calculated now

Employees leaving an organisation are entitled to an end-of-service gratuity after completing at least one year of service.

The tenure is calculated on the number of days worked and does not include lengthy leave periods, such as a sabbatical. If you have worked for a company between one and five years, you are paid 21 days of pay based on your final basic salary. After five years, however, you are entitled to 30 days of pay. The total lump sum you receive is based on the duration of your employment.

1. For those who have worked between one and five years, on a basic salary of Dh10,000 (calculation based on 30 days):

a. Dh10,000 ÷ 30 = Dh333.33. Your daily wage is Dh333.33

b. Dh333.33 x 21 = Dh7,000. So 21 days salary equates to Dh7,000 in gratuity entitlement for each year of service. Multiply this figure for every year of service up to five years.

2. For those who have worked more than five years

c. 333.33 x 30 = Dh10,000. So 30 days’ salary is Dh10,000 in gratuity entitlement for each year of service.

Note: The maximum figure cannot exceed two years total salary figure.

The specs

Common to all models unless otherwise stated

Engine: 4-cylinder 2-litre T-GDi

0-100kph: 5.3 seconds (Elantra); 5.5 seconds (Kona); 6.1 seconds (Veloster)

Power: 276hp

Torque: 392Nm

Transmission: 6-Speed Manual/ 8-Speed Dual Clutch FWD

Price: TBC

MATCH INFO

Uefa Champions League semi-final, first leg

Bayern Munich 1
Kimmich (27')

Real Madrid 2
Marcelo (43'), Asensio (56')

'Saand Ki Aankh'

Produced by: Reliance Entertainment with Chalk and Cheese Films
Director: Tushar Hiranandani
Cast: Taapsee Pannu, Bhumi Pednekar, Prakash Jha, Vineet Singh
Rating: 3.5/5 stars

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UPI facts

More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions

The specs: 2018 Nissan 370Z Nismo

The specs: 2018 Nissan 370Z Nismo
Price, base / as tested: Dh182,178
Engine: 3.7-litre V6
Power: 350hp @ 7,400rpm
Torque: 374Nm @ 5,200rpm
Transmission: Seven-speed automatic
​​​​​​​Fuel consumption, combined: 10.5L / 100km

New UK refugee system

 

  • A new “core protection” for refugees moving from permanent to a more basic, temporary protection
  • Shortened leave to remain - refugees will receive 30 months instead of five years
  • A longer path to settlement with no indefinite settled status until a refugee has spent 20 years in Britain
  • To encourage refugees to integrate the government will encourage them to out of the core protection route wherever possible.
  • Under core protection there will be no automatic right to family reunion
  • Refugees will have a reduced right to public funds

Shooting Ghosts: A U.S. Marine, a Combat Photographer, and Their Journey Back from War by Thomas J. Brennan and Finbarr O’Reilly

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The biog

Name: Mohammed Imtiaz

From: Gujranwala, Pakistan

Arrived in the UAE: 1976

Favourite clothes to make: Suit

Cost of a hand-made suit: From Dh550

 

UAE currency: the story behind the money in your pockets
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How to get there

Emirates (www.emirates.com) flies directly to Hanoi, Vietnam, with fares starting from around Dh2,725 return, while Etihad (www.etihad.com) fares cost about Dh2,213 return with a stop. Chuong is 25 kilometres south of Hanoi.
 

AI traffic lights to ease congestion at seven points to Sheikh Zayed bin Sultan Street

The seven points are:

Shakhbout bin Sultan Street

Dhafeer Street

Hadbat Al Ghubainah Street (outbound)

Salama bint Butti Street

Al Dhafra Street

Rabdan Street

Umm Yifina Street exit (inbound)

Dubai works towards better air quality by 2021

Dubai is on a mission to record good air quality for 90 per cent of the year – up from 86 per cent annually today – by 2021.

The municipality plans to have seven mobile air-monitoring stations by 2020 to capture more accurate data in hourly and daily trends of pollution.

These will be on the Palm Jumeirah, Al Qusais, Muhaisnah, Rashidiyah, Al Wasl, Al Quoz and Dubai Investment Park.

“It will allow real-time responding for emergency cases,” said Khaldoon Al Daraji, first environment safety officer at the municipality.

“We’re in a good position except for the cases that are out of our hands, such as sandstorms.

“Sandstorms are our main concern because the UAE is just a receiver.

“The hotspots are Iran, Saudi Arabia and southern Iraq, but we’re working hard with the region to reduce the cycle of sandstorm generation.”

Mr Al Daraji said monitoring as it stood covered 47 per cent of Dubai.

There are 12 fixed stations in the emirate, but Dubai also receives information from monitors belonging to other entities.

“There are 25 stations in total,” Mr Al Daraji said.

“We added new technology and equipment used for the first time for the detection of heavy metals.

“A hundred parameters can be detected but we want to expand it to make sure that the data captured can allow a baseline study in some areas to ensure they are well positioned.”

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

Updated: March 29, 2024, 1:42 PM