India stands out in
annual logistics Index, but executives show concern about 2017
BAAR, Switzerland – Jan. 24, 2017 – Nearly 69%
of logistics professionals say they worry about a retreat from free trade in
2017 following the UK’s Brexit vote and the collapse of global and regional
trade talks, a new survey shows.
of more than 800 global logistics and supply chain executives is part of the
2017 Agility Emerging Markets Logistics Index, an annual snapshot of industry
sentiment and a ranking of the world’s 50 leading emerging markets by size,
business conditions, infrastructure and transport connections.
significant minority – 43% -- said the International Monetary Fund’s 2017
emerging markets growth forecast of 4.6% is too optimistic.
a standout in the survey and country rankings. Logistics professionals picked
India as the emerging market with the most logistics potential and the country
where their companies are most likely to invest. India climbed past United Arab
Emirates to No. 2 in the Index after China.
Twenty-four of the 50
countries – including seven of the top 10 -- experienced a year-over-year
deterioration in their Index scores, reflecting stagnation in global trade
growth and turbulence in emerging markets.
China, the world’s
second-largest economy, remains the world’s leading emerging market. In the
survey, supply chain executives identified the direction of China’s economy as
the factor most likely to drive global economic and trade growth in 2017.
Seventy-six percent said China’s slowing economy is slowing, but only 17% said
the slowdown is significantly hurting the transport and logistics sector.
Sixty-six percent said lower growth will not alter their plans in China.
Robust growth and
long-anticipated tax and economic reform pushed India to No. 2 in the Index and
impressed the logistics executives surveyed. Even so, India’s surprise decision
to remove high-denomination bank notes from circulation and encourage cashless
payments could be jarring for the economy in 2017.
UAE, No. 3 overall in
the Index, again topped the rankings in the areas of business climate, and in
logistics infrastructure and transport connections. Gulf countries UAE, Qatar,
Oman, Bahrain, Saudi Arabia and Kuwait claimed six of the top 10 spots for best
Iran climbed eight
spots in the Index rankings to 18th overall and leaped to 9th
from No. 15 among emerging markets countries that executives view as having the
most potential to grow as logistics markets. Iran’s gains were the biggest of
any country in the Index or the survey.
economies – Nigeria and South Africa – were among the countries that fell most
sharply in the Index. Smaller African markets – Uganda, Ethiopia, Tanzania and
Kenya – improved their rankings in 2017.
Brazil held its No. 7
Index ranking despite a painful recession and the impeachment of President
Dilma Rousseff. In the survey, logistics executives again picked Brazil as the
the market with the most logistics potential after India and China. One reason
for their optimism: nearly 57% expect commodity prices to rebound in 2017,
although most do not expect significant increases.
Bahrain jumped five
spots in the latest Index to No. 23 after years of social unrest that hurt its
ranking. Argentina, attempting to end years of international economic isolation,
climbed three places to No. 28. Kazakhstan shot up four spots to No. 14,
largely on the strength of business conditions that ranked behind only those of
four Gulf countries – UAE, Qatar, Oman and Bahrain.
Turkey weathered the
effects of an attempted coup and extremist violence, moving from 10th
to No. 9 in the latest Index. Russia fell from 9th to No. 10, a
modest slip suggesting that has contained the fallout from Western economic
sanctions and low energy prices.
in its eighth year, ranks emerging markets countries by factors that make them
attractive to logistics providers, freight forwarders, shipping lines, air
cargo carriers and distributors.
Essa Al-Saleh, CEO of Agility Global Integrated Logistics, said logistics providers and their customers are concerned that anti-globalization feeling and populist policies in the UK and United States could spread and harm trade in emerging markets that rely heavily on exports.
markets continue to deliver the highest growth rates in the world, but as links
in the global supply chain, countries can be extremely hard to evaluate,”
Al-Saleh said. “The Index and the survey are useful when it comes to
identifying the relative strengths and weaknesses of individual markets.”
Transport Intelligence (Ti), a leading analysis and research
firm for the logistics industry, compiled the Index.
John Manners-Bell, Chief Executive of Ti, said: “Uncertainty and
volatility have characterized many emerging markets in 2016. This has been compounded
by the political environment in Europe and the U.S., which will have direct
consequences on trade with Latin America, Asia and Africa. However there have
been many positives too -- for example, the strong performance of India. More
than ever, the Index identifies and contrasts those markets which will prosper
from the most vulnerable and poorest performing.”
2017 Agility Emerging Markets Logistics Index:
Index video: www.agility.com/Index2017video