Ports are critical nodes in the global trade network, but they are vulnerable to the impacts of natural disasters. The locations of ports in coastal areas makes them exposed to storms and flooding. Apart from local impacts to port operations, close linkages across the global maritime trade network makes trade flows through ports vulnerable to spillovers from disasters elsewhere. As illustrated by recent events, port disruptions can have large ripple effects through the global economy and supply chains. So how should policymakers prepare for trade shocks from climate extremes that will become more frequent and severe over time?
Our project aims to build an online platform to monitor trade disruptions and assess their regional and global spillover effects through port-to-port linkages. Drawing on the team's extensive prior work, the platform will use satellite-based vessel data and big data analytics to produce actionable insights for IMF staff and country authorities. Our proposed name for this platform is "PortWatch."
Our platform aims to provide insights at three levels. Layer 1 will consist of an email alert system that provides real-time monitoring of the direct impact of natural disasters on maritime trade of affected countries. Layer 2 will provide a nowcast of the potential indirect spillover effects to other countries in the maritime network and global supply chain. Finally, Layer 3 will facilitate scenario analysis and planning for natural disasters that might hit some of the major ports in the global and regional trade network ("what-if" scenarios).
The platform would provide valuable inputs to the IMF's three main functions of surveillance, lending and capacity development. Layer 1 (monitoring) is most relevant for bilateral surveillance and economic monitoring in a program context. Layer 2 (spillover analysis) would be particularly valuable for regional surveillance but would also provide important insights for country teams working on surveillance and program countries. Layer 3 (scenario analysis) could inform climate-related capacity development and feed into multilateral/regional surveillance efforts. The outputs from our platform would also help facilitate future IMF climate-related analysis, including in current and future projects selected under the Climate Innovation Challenge.
Watch the a 1-minute video below summarizing our proposed PortWatch platform:
The schematic below an overview of key aspects of our project: