Agility sees old 'tiger' economies rivalling young BRICs

AGILITY's latest Emerging Markets Logistics Index shows steady growth of BRIC nations, but also reveals that the old "tiger economies" of Asia holding their own as low-cost production sources for the global supply chain.


The Agility index compares 39 emerging markets and provides data on logistics, air cargo, shipping lines and freight forwarders. It is backed by the UK-based Transport Intelligence (TI) survey of 330 logistics executives with opinions on those rapidly-developing countries and those on the industry watch-list.


It "enables companies to differentiate between those markets which offer immediate potential and those which will take much longer to develop," said TI chief executive officer John Manners-Bell.


First and second place go to China and India, but fear of economic overheating and lack of visibility in China, and barriers to entry in India are leading foreign investors to look at alternative logistic hubs.


Of the Asian economies rivalling BRIC nations is Indonesia in fourth place just ahead of Russia, and below Brazil but on a par in terms of economic growth and market size. Malaysia and Thailand show strength despite the size of market at just below the top 10 at 11 and 12 respectively.


Malaysia offers easy market access and Thailand's high market potential and few barriers to market entry are attractive. Vietnam comes in far below at 25, but it shows strength in foreign direct investment, now referred to as "China+One" for its potential to compete with China as a manufacturing base.


Philippines comes in at 24 with its connectivity and market compatibility weak. Pakistan (17) and Bangladesh (26) are stable but political instability and security threats weaken its connectivity and market compatibility.


Saudi Arabia is a star performer at No 6, up four places from last year, proving itself the top investment for logistics opportunities. United Arab Emirates (UAE) was 9 and moved up more than any other, beating China and Chile in transport connectivity.


Egypt dropped four places to 13 on the back of business costs associated with crime, violence and terrorism.


At the bottom was Paraguay (39), Kenya (37) and Bolivia (38), attributed to poor infrastructure and security threats making them the least attractive for logistics investors.


Despite Africa's future potential as a manufacturing hub to match Asia-Pacific infrastructure, its security and business compliance problems remain.


The 2011 index is produced by Agility's Global Integrated Logistics (GIL) based in Switzerland and was published at the annual meeting of the World Economic Forum in Davos.


Agility GIL provides supply chain solutions in air, sea and road freight forwarding, warehousing, distribution and specialised services in project logistics, fairs and events, fuels and chemicals.
(Source:http://www.schednet.com)