The impact of the China effect and global financial crisis on Korea’s shipping industry, 2004–2010

Abstract

The Korean shipping industry, which had been striving to recover from the Asian Financial Crisis, underwent significant quantitative expansion between 2004 and 2008. This growth was largely fueled by the so-called “China Effect,” which generated a global shipping boom, during which an average of 20 new ocean-going shipping companies were founded annually in Korea. However, the waning of the China Effect in 2008, compounded by the global financial crisis, triggered a renewed downturn in the industry. Drawing on previously unreleased application data submitted to the Korea Shipowners’ Association, this paper analyzes the dynamics and characteristics of Korea’s shipping boom during the China-led surge and examines the industry's response to the subsequent crisis between 2008 and 2010. The findings shed light on the structural factors behind Korea’s emergence as a global maritime power and provide a historical foundation for future quantitative research on post-2010 developments.