DHL sees three self-made obstacles to emerging market growth

GERMAN express delivery giant sees three self-made problems retarding emerging market growth - high customs costs, slow market liberalisation and under-developed distribution channels.

"In Asia Pacific, almost 15 per cent of supply chain costs are still related to customs and regulations procedures, compared to just three per cent in Europe," said DHL customer service CEO Richard Owens.

Said DHL customer service COO Rob Siegers: "Twelve emerging 'hotspots', identified in the IMF World Economic Outlook have a greater growth potential than the main economies of the developed world combined. But a closer look is vital to ensure these economies can deliver on their promise."

Working in 220 countries, DHL believes that to meet growth potential and logistics needs, emerging markets must rapidly increase network capabilities along all modes of transport, speed market liberalisation and free trade zone development, plus slash customs costs.

As logistics is the backbone of worldwide trade, easing the movement of goods and services via better logistics processes, infrastructure systems and government policies in these markets will allow emerging markets to reach their goals on schedule.

"Key growth industries such as textiles and garments, pharmaceuticals and renewable energy also need to play a part in driving improvements and sustainability in the supply chain."

Hotspot economies include Mexico, Turkey, Russia, mainland China, Korea, Taiwan, Thailand, India, the United Arab Emirates, Saudi Arabia, South Africa and Brazil.

Together, they are expected to achieve an average GDP growth of 7.2 per cent in 2015, compared to the projected 2.1 per cent of the G7 nations. The combined GDP of these hotspot economies is expected to command a 38 per cent share of global GDP by 2015 - two per cent more than the G7's global GDP. Last year, the average GDP growth for these hotspots stood at 2.8 per cent, compared to -3.4 per cent for the G7 nations. Global GDP market share was 32 per cent, just nine per cent lower than the G7's stake.

DHL employs 300,000 worldwide and is part of Deutsche Post DHL. The group generated more than EUR46 billion (US$64 billion) in revenue in 2009.
(Source:www.schednet.com)