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Southeast Asian Countries Lead Agility Emerging Markets Index

PR Newswire Asia Monday, 10 February 2020
Indonesia, Malaysia, Thailand and Vietnam among leaders in global logistics index

BAAR, Switzerland, Feb. 10, 2020 /PRNewswire/ -- Southeast Asian countries outdo most other emerging market regions in the 11^th annual Agility Emerging Markets Logistics Index, a broad gauge of competitiveness based on logistics strength and business fundamentals.

Business-friendly conditions and core strengths position several Southeast Asian countries near the top of the Index, behind giants China (1) and India (2).

The Index ranks 50 countries by factors that make them attractive to logistics providers, freight forwarders, shipping lines, air cargo carriers and distributors. Among ASEAN countries, Indonesia (4), Malaysia (5), Thailand (9) and Vietnam (11) are strong. The Philippines is rated at No. 22 on this year's Index.

In the midst of the US-China trade situation, more respondents chose Vietnam than any other country as the place where companies would be likely to move to if they ceased operations in China. Last year, 56% of logistics professionals said Southeast Asian countries would benefit overall as the result of US-China situation, but for 2020 that percentage has decreased to 42%.

Andy Vargoczky, SVP of Sales & Marketing Asia-Pacific, Agility GIL, says the region's dependence on European and North American export markets is easing as ASEAN countries mature, integrate, consume more of what they make, and rely more on services for economic growth and jobs.

"ASEAN countries are performing well, even in a period of global uncertainty," Vargoczky says. "Indonesia, Malaysia, Thailand and Vietnam are all in or near the top 10, and their importance in global supply and transport chains continues to grow."

Agility's annual survey of 780 supply chain professionals reflects overall pessimism about the world economy, with 64% saying a global recession is likely and only 12% of executives saying a recession is unlikely. Downward pressure on global trade volumes, uncertain growth prospects and the ongoing trade situation between the US and China are driving this belief.

Across 50 countries, China, India and Indonesia rank highest for domestic logistics. China, India and Mexico are top for international logistics with Vietnam 4th, Indonesia 5^th, and Thailand 6^th. UAE, Malaysia and Saudi Arabia have the best business fundamentals.

*2020 Index and Survey Highlights *

· China and India, atop the 2020 rankings based on their size and strength as international and domestic logistics markets, lag behind smaller rivals in business fundamentals, a category that rates countries based on regulatory environment, credit and debt dynamics, contract enforcement, anti-corruption safeguards, price stability and market access. In that area, China ranks No. 8 and India is No. 18.
· Survey respondents see India as the market with greatest potential over China, their second choice. In rankings of best business conditions, several countries are making big moves: Egypt climbs 10 spots to #17; Ukraine jumps 10 spots to #27; Ghana drops 13 spots to #32; and Iran tumbles 12 spots to #38.
· Egypt, despite a brief period of social unrest in 2019, showed significant gains across all indices. On the overall index, Egypt rose six spots to No. 20, while leaping 10 spots on the business fundamentals chart (20), six spots on the domestic opportunities index (13) and jumping five spots on the international opportunities index (23).
· The top three factors that keep small businesses out of global trade are trade bureaucracy (17%), government/border instability (14%) and inability to compete with larger rivals (14%), according to supply chain professionals.
· Despite the belief a recession is likely, emerging markets still grew an estimated 3.7% 2019 and are projected by the IMF to grow by 4.4% in 2020. As for what is driving emerging markets growth, 23% say modernization of customs systems and processes, 18% cite increased internet penetration, 16% say modernization of logistics provider systems (WMS, TMS, etc.) and 15% mention increased adoption and modernization of online payment systems.
· The top five "megacity" emerging markets logistics hubs are Shanghai, New Delhi, São Paulo, Jakarta and Mexico City. Megacities -- urban centers with populations of 10 million or more -- require vast logistics support to meet domestic needs and engage in trade.
· E-commerce fulfillment is named as the logistics service most likely to maintain or improve growth, well ahead of other services such as domestic last-mile delivery and international express parcel delivery.
· The countries with the least potential as logistics markets in 2020 are Syria, Iran, Venezuela, Iraq and Libya, according to the survey.

*2020 Agility Emerging Markets Logistics Index:* www.agility.com/2020index

*About Agility*

Agility is a global logistics company with $5.1 billion in annual revenue and 26,000+ employees in more than 100 countries. It is one of the world's top freight forwarding and contract logistics providers, and a leader and investor in technology to enhance supply chain efficiency. Agility is a pioneer in emerging markets and one of the largest private owners and developers of warehousing and light industrial parks in the Middle East, Africa and Asia. Agility's subsidiary companies offer fuel logistics, airport services, commercial real estate and facilities management, customs digitization, and remote infrastructure services. 

For more information about Agility, visit www.agility.com
Twitter: twitter.com/agility
LinkedIn: linkedin.com/company/agility
YouTube: youtube.com/user/agilitycorp

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