The impact of Covid-19, disrupting supply chains, has created bottlenecks hindering the smooth flow of goods and raw materials that power the global economy. When these impacts surfaced, many logistics businesses recognized the potential of the Asian market.
Global management consulting firm McKinsey stated that post-pandemic, Asia is expected to recover economically faster than other regions. Given the strong development in Asian countries in the current context, many global brands are reevaluating the region's position in their supply chain strategy.
As a result, the region is predicted to become a hub for logistics activities in terms of both growth speed and investment. In terms of growth, Asia is projected to account for about half of global trade growth by 2030.
During the total market growth period of 2020-2025, the e-commerce logistics market in Asia is expected to account for 57%. The GDP growth in Asia is forecasted to reach 4.5%, more than twice the world's average of 2.0%. Many Asian countries are expected to experience a significant growth surge.
By 2025, Asia is expected to account for 30% of global consumption. In this, India, Hong Kong (China), and Singapore will remain the leading logistics markets in Asia.
Currently, the logistics industry in India is growing at over 10% annually. India's budget allocates a significant portion to infrastructure investment, with plans to improve road, rail, and inland waterway connectivity underway.
Indian ports handle 95% of the country's commercial activities, playing a crucial role in the global supply chain. India currently allows 100% FDI for the construction and maintenance of ports, along with tax incentives from the government. With increased enthusiasm from private sectors and the government, opportunities for foreign investors in the supply chain in India are rising.
In Singapore, with its advantageous geographical location and minimal weather impact, the city-state owns ports and airports that operate year-round. Combined with modern infrastructure, Singapore is a bustling transshipment point for ships from around the world.
Singapore is considered a prime location for major logistics companies, with 25 leading companies in the industry currently operating there. Currently, Singapore is connected to 200 shipping companies and 600 ports in 123 countries, with daily trips to most major ports worldwide.
Similarly, with its perfect geographical location, Hong Kong is the gateway between the world and China, doubling the value of its supply chain. Currently, Hong Kong International Airport (HKIA) is one of the top 10 busiest airports in the world.
Moreover, markets like Vietnam, Indonesia, and Thailand are gradually showing significant development potential. Notably, Vietnam has the potential to become a logistics hub in the region and the world.
Vietnam's logistics sector is experiencing considerable growth due to the national economic development, manufacturing, and e-commerce sectors. According to the Agility's Emerging Markets Logistics Index report published in 2022, Vietnam ranks 11th among the top 50 leading countries.
The transportation and logistics market in Vietnam is estimated to grow with a compound annual growth rate (CAGR) of 7% from 2021 to 2026. Therefore, to seize growth opportunities, logistics companies need to grasp the evolving trends in this industry network.
McKinsey predicts that global logistics companies already present in Asia or those with plans to focus on Asia will perform better than their counterparts. Missing out on the development potential in Asia, businesses will miss the suitability when approaching customer needs, as Asia will play an essential role in the global supply chain.
McKinsey also provides four solutions to help logistics companies in Asia seize opportunities, including mergers and acquisitions, strategic investments, IPOs for businesses, and more. Specifically, businesses can quickly enter the market through mergers and acquisitions in logistics operations. Along with that, they can expand their business investment portfolio and enhance competitiveness.
Cre: xahoi.congly.vn
