Last week, South Korean shipping company Hanjin, the world’s seventh-largest container line, filed for bankruptcy after failing to reach an agreement with its creditors to alleviate its $5.37 billion in debt. This has left 85 of the 97 container ships the company operates literally stranded at sea, as ports refused to admit them for fear that stevedores and tugboat crews won’t be paid. Even if the situation is resolved soon, the unprecedented mess is an ominous indicator about the state of global trade.
“Ships get arrested on occasion, and container companies have gone bust in the past, but the difference here is a matter of scale,” says James Baker, editor of Containerisation International, a publication of the British shipping journal Lloyd’s List. “We’ve never seen such a larger line go down so comprehensively in such a large way.”
