Agility Emerging Markets Logistics Index Highlights 2021
1
Pandemic Recovery in 2021? Or Beyond? Percentage of logistics executives who expect particular regions to recover in 2021: 53% Europe 49% North America Percentage expecting recovery in other regions between 2022 and 2024: 51% 42% 52% South America say the global economy won’t recover until at least 2022 Sub-Saharan Africa AGILITY EMERGING MARKETS LOGISTICS INDEX 2021 Amid an economic downturn and uncertainty caused by the pandemic, these nations rank highest in the 2021 Agility Emerging Markets Logistics Index. What are the Top Ten Emerging Markets in 2021? 2021 Index Rank Change from 2020 2 3 UAE 4 Malaysia 5 Saudi Arabia 6 Mexico 7 Vietnam 8 Qatar 9 Turkey 10 1 0 0 0 0 0 +1 +1 +3 -1 -1 Top Domestic Logistics Market Top International Logistics Opportunities Best Business Fundamentals Changes to the Top Ten Vietnam jumps to 8 th from 11 th . Thailand drops to 11 th from 9 th . Mexico climbs to 7 th , its highest position in Index history. India 2 Indonesia 3 China 1 India 2 Mexico 3 China 1 Malaysia 2 Saudi Arabia 3 UAE 1 India Indonesia China The Pandemic Brings Challenges, but the Logistics Industry is Looking Ahead How have operations been affected by COVID-19? say their supply chain has been disrupted say they are experiencing decreases in sales say they are experiencing significant increases in demand for certain items say orders have been canceled 20% 19% 16% 11% Once the crisis is over, logistics executives express confidence in returning to business. Which most closely matches your strategy on operating/investing in emerging markets after the Covid-19 crisis? say they are reviewing their strategy and they are currently MORE confident 26% say they will be entering emerging markets MORE actively as a result 26% COVID-19 is Changing the Way Businesses Operate 60% of logistics executives in the Agility Emerging Markets Logistics Index say the pandemic has resulted in permanent changes to the way their businesses operate globally or regionally. About 25% said it’s too soon to tell. Only 14% say business will operate as usual, a sign the pandemic has made permanent changes in the way the global economy will move ahead. The Changing Face of Protectionism Amid signs of renewed protectionism in developed and developing economies alike, 47% of global logistics executives say their companies will only invest in emerging markets with “favorable conditions.” Will increasing trade protectionism prompt you to rethink investments in emerging markets? 11% Investments will continue as planned 47% We will continue to invest, but only in markets with favorable trade conditions 18% Investment plans will not be changed 18% We have suspended investments until outcomes are more clear Nigeria, a Nation on the Move Nigeria leaped higher in the Agility Emerging Markets Logistics Index for 2021. Sub-Saharan Africa’s largest economy has not escaped a downturn during the pandemic, but it has a growing and increasingly middle-class population. Domestic Logistics Opportunities Up 6 spots to #10 Overall Index Up 5 spots to #30 International Logistics Opportunities Up 2 spots to #43 Business Fundamentals Up 2 spots to #39 The Gulf is Strongest in Business Fundamentals The Gulf offers the best, most stable business climates in the world of emerging markets. 3 4 Bahrain 7 Oman 8 Kuwait 11 1 Saudi Arabia Qatar UAE Nearby Jordan is No. 10. Malaysia (2), Chile (5), China (6) and Morocco (9) are the other top performers. In business fundamentals: 2020: Disruption Across the Global Supply Chain Logistics executives felt disruption across the entire supply chain in 2020. This is likely to have implications for freight forwarders in 2021 and beyond. Where companies felt the disruption: 19.6% Congestion at ports and other transhipment points 16.9% Ensuring supply of goods/inputs 18.4% Sourcing transportation capacity 13.8% Storage of goods 16.1% Downstream distribution and delivery to consignees 15.1% International operations Emerging Markets in 2021: The Most Potential and the Least Potential The countries with the MOST potential to be logistics hubs in the next FIVE years are… Saudi Arabia increases its viability as a logistics center, leaping three spots to #7. Kuwait jumps three spots to #20. The countries with the LEAST potential to grow as logistics market in the next FIVE years are… China India Vietnam Brazil UAE 1 2 3 4 5 Iran Venezuela Ethiopia Libya Lebanon 1 2 3 4 5 Asia Dominates the 2021 Agility Emerging Markets Logistics Index Asia, home to the world’s largest concentration of export-oriented manufacturing, continues to dominate the Index. Six of the 11 top countries in the Index are Asian markets. Vietnam, the leading alternative to China as a production base for companies looking to exit or diversify from China, jumped three spots to No. 8 in the 2021 Index. Asian nations on the 2021 Index: 2 3 Malaysia 5 Vietnam 8 Thailand 11 Philippines 21 1 China India Indonesia If Businesses Move Operations from China, Where to Go? Despite COVID-19 pandemic and ongoing US-China trade friction, only 8% of companies relocating production from China would consider reshoring to their home countries. For logistics executives who would pull operations from China, where would they relocate to? V i e t n a m I n d i a I n d o n e s i a T h a il a n d M a l a y s i a 2 0 % 1 7 % 1 2 % 1 0 % 1 0 % 14% Insufficient infrastructure 13% Incurring additional costs 12% Finding right vendors/suppliers 12% Trade compliance issues 10% Changing demands In a New Decade, Changing Supply Chain Geography As companies examine new production locations, their biggest concerns are insufficient infrastructure and additional cost. The desire to produce where there is abundant supply of low-cost labor is almost a non-factor today. Logistics executives were asked: "What are your main concerns in supply chain geography?" Which is the primary motivator for shifts in production supply chains? 46% Cost factors 23% Surety of supply 16% Diversify supplier base 11% Labor availability 4% Diversify inventory locations Latin American Emerging Markets Make Some Moves Chile has traditionally been strong in creating business-friendly conditions. In 2021, the South American nation has been joined by other Latin American nations that are improving the climate for business. 12 20 Peru 24 Ecuador 28 Brazil 36 Paraguay 40 Bolivia 41 5 Chile Uruguay Mexico Notable exceptions: Argentina at #43 tumbled three spots, while Venezuela was #49 out of 50 countries. 0 Change from 2020: +1 +4 +7 +5 +5 +2 +3 Business Fundamentals 2021 Index: Domestics Logistics Market: Movers and Shakers 2021 Index Rank The Big Movers: Change from 2020 2 3 UAE 4 Malaysia 5 Qatar 6 Saudi Arabia 7 Brazil 8 Mexico 9 Nigeria 10 1 0 0 +1 -1 -1 -3 0 +6 +4 0 India Indonesia China Malaysia, up four to #5 Nigeria, up six to #10 Iran, up five to #22 Myanmar, up six to #42 Cambodia, up five to #44 Kuwait, down four to #12 Argentina, down four to #26 Angola, down six to #49 agility.com/2021Index 2 1 3 9 5 8 6 4 7 10 4 7 1 3 8 11 2 1 3 5 8 11 21 5 12 20 24 28 36 40 41 45% Middle East and North Africa 56% Asia Pacific 2
Transcript of Agility Emerging Markets Logistics Index Highlights 2021
Pandemic Recovery in 2021? Or Beyond?
Percentage of logistics executives who expect particular regions to recover in 2021:
53%
Europe
49%
North America
Percentage expecting recovery in other regions between 2022 and 2024:
51% 42% 52%
South America
say the globaleconomy won’trecover until at least 2022Sub-Saharan Africa
AGILITY EMERGING MARKETSLOGISTICS INDEX2021
Amid an economic downturn and uncertainty caused by the pandemic, these nations rank highest in the 2021 Agility Emerging Markets Logistics Index.
What are the Top TenEmerging Markets in 2021?
2021 IndexRank Change from 2020
2
3
UAE 4
Malaysia5
Saudi Arabia6
Mexico7
Vietnam 8
Qatar9
Turkey10
1 0
0
0
0
0
+1
+1
+3
-1
-1
Top Domestic Logistics Market
Top International Logistics
Opportunities
BestBusiness
Fundamentals
Changes to the Top Ten
Vietnam jumps to 8th from 11th.
Thailand drops to 11th from 9th.
Mexico climbs to 7th, its highest position in Index history.
India2
Indonesia3
China1
India2
Mexico3
China1
Malaysia2
Saudi Arabia3
UAE1
India
Indonesia
China
The Pandemic Brings Challenges, but the LogisticsIndustry is Looking Ahead
How have operations been affectedby COVID-19?
say their supply chain has been disrupted
say they are experiencing decreases in sales
say they are experiencing significant increases in demand for certain items
say orders have been canceled
20%
19%
16%
11%
Once the crisis is over, logistics executives express confidence in returning to business.
Which most closely matches your strategy on operating/investing in emerging markets after the Covid-19 crisis?
say they are reviewing their strategy and they are currently MORE confident
26% say they will be entering emerging markets MORE actively as a result
26%
COVID-19 is Changing the Way Businesses Operate
60% of logistics executives in the Agility Emerging Markets Logistics Index say the pandemic has resulted in permanent changes to the way their businesses operate globally or regionally.
About 25% said it’s too soon to tell.
Only 14% say business will operate as usual, a sign the pandemic has made permanent changes in the way the global economy will move ahead.
The Changing Face of Protectionism
Amid signs of renewed protectionism in developed and developing economies alike, 47% of global logistics executives say their companies will only invest in emerging markets with “favorable conditions.”
Will increasing trade protectionism prompt you to rethink investments in emerging markets?
11% Investments will continue as planned
47% We will continue to invest, but only in markets with favorable trade conditions
18% Investment plans will not be changed
18% We have suspended investments until outcomes are more clear
Nigeria, a Nation on the Move
Nigeria leaped higher in the Agility Emerging Markets Logistics Index for 2021.
Sub-Saharan Africa’s largest economy has not escaped a downturn during the pandemic, but it has a growing and increasingly middle-class population.
Domestic Logistics
Opportunities
Up 6 spots to #10
OverallIndex
Up 5 spots to #30
International Logistics
Opportunities
Up 2 spots to #43
Business Fundamentals
Up 2 spots to #39
The Gulf is Strongest in Business Fundamentals
The Gulf offers the best, most stable business climates in the world of emerging markets.
3
4
Bahrain7
Oman 8
Kuwait11
1
Saudi Arabia
Qatar
UAE
Nearby Jordan is No. 10.Malaysia (2), Chile (5), China (6) and Morocco (9) are the other top performers.
In business fundamentals:
2020: Disruption Across the Global Supply Chain
Logistics executives felt disruption across the entire supply chain in 2020. This is likely to have implications for freight forwarders in 2021 and beyond.
Where companies felt the disruption:
19.6% Congestion at ports and
other transhipment points
16.9% Ensuring supply of
goods/inputs
18.4% Sourcing
transportation capacity
13.8% Storage of goods
16.1% Downstream distribution and delivery to consignees
15.1% International operations
Emerging Markets in 2021: The Most Potential and the Least Potential
The countries with the MOST potential to be logistics hubs in the next FIVE
years are…
Saudi Arabia increases its viability as a logistics center, leaping three spots to #7.Kuwait jumps three spots to #20.
The countries with the LEAST potential to grow as logistics market in the next
FIVE years are…
China
India
Vietnam
Brazil
UAE
1234 5
Iran
Venezuela
Ethiopia
Libya
Lebanon
1234 5
Asia Dominates the 2021 Agility Emerging MarketsLogistics Index
Asia, home to the world’s largest concentration of export-oriented manufacturing, continues to dominate the Index.
Six of the 11 top countries in the Index are Asian markets. Vietnam, the leading alternative to China as a production base for companies looking to exit or diversify from China, jumped three spots to No. 8 in the 2021 Index.
Asian nations on the 2021 Index:
2
3
Malaysia5
Vietnam 8
Thailand11
Philippines21
1 China
India
Indonesia
If Businesses Move Operations from China, Where to Go?
Despite COVID-19 pandemic and ongoing US-China trade friction, only 8% of companies relocating production from China would consider reshoring to their home countries.
For logistics executives who would pull operations from China, where would they relocate to?
Vie
tnam
India
IndonesiaThailand
Malaysia20
%
17%12%
10%
10%
14% Insufficient infrastructure
13% Incurring additional costs
12% Finding right vendors/suppliers
12% Trade compliance issues
10% Changing demands
In a New Decade, Changing Supply Chain Geography
As companies examine new production locations, their biggest concerns are insufficient infrastructure and additional cost. The desire to produce where there is abundant supply of low-cost labor is almost a non-factor today.
Logistics executives were asked: "What are your main concerns in supply chain geography?"
Which is the primary motivator for shifts in production supply chains?
46% Cost factors
23% Surety of supply
16% Diversify supplier base
11% Labor availability
4% Diversify inventory locations
Latin American Emerging Markets Make Some Moves
Chile has traditionally been strong in creating business-friendly conditions.
In 2021, the South American nation has been joined by other Latin American nations that are improving the climate for business.
12
20
Peru 24
Ecuador28
Brazil36
Paraguay40
Bolivia41
5 Chile
Uruguay
Mexico
Notable exceptions: Argentina at #43 tumbled three spots, while Venezuela was #49 out of 50 countries.
0
Changefrom 2020:
+1
+4
+7
+5
+5
+2
+3
Business Fundamentals 2021 Index:
Domestics Logistics Market: Movers and Shakers
2021 IndexRankThe Big Movers: Change from 2020
2
3
UAE 4
Malaysia5
Qatar6
Saudi Arabia7
Brazil8
Mexico9
Nigeria10
1 0
0
+1
-1
-1
-3
0
+6
+4
0
India
Indonesia
China
Malaysia, up four to #5Nigeria, up six to #10Iran, up five to #22Myanmar, up six to #42Cambodia, up five to #44Kuwait, down four to #12Argentina, down four to #26Angola, down six to #49
agility.com/2021Index
21
3
9
586
47
10
4
7
13
8
11
2
1
3
5
811 21
5
12
20
24
28
36
40
41
45%
Middle East andNorth Africa
56%
Asia Pacific
2
