China is expected to overtake the US, and dominate global trade by 2030. Together with China, emerging economies like Indonesia, Malaysia, Nigeria, Saudi Arabia and India are also poised to play an increasingly important role in the top sea and air freight routes in 20 years. These findings are revealed in the latest PwC “Future of World Trade: Top 25 Sea and Air Freight Routes in 2030” report.
The report reveals four key areas that could present significant opportunities for transport and logistics (T&L) firms:
- Trade within the Asia-Pacific region.
- Trade between emerging and developed economies – inspired by Germany/China
- Trade between emerging economies, such as parts of Asia and Latin America
- Trade between China and Africa
“Transport and logistics companies will need to adapt to the change in trade patterns to ensure they maximise their profit opportunities. Planning for the trends that will shape the trade landscape over the next 20 years would benefit a company in this highly globalised marketplace. The ‘first mover’ advantage is likely to be important, and establishing a presence before your competitors on a route that becomes a significant global trade flow is likely to be highly valuable,” says Yael Selfin, PwC’s Head of Macro Consulting.
According to the report, the changing picture of global trade has already been providing opportunities and challenges for those operating in the T&L industry. For example, 73% of T&L CEOs say they are changing their strategies to respond to the potential growth in emerging markets.
“Many growth stories remain in Asia, with China still being considered as the epicentre of global trade. In the recent PwC’s 14th Annual Global CEO Survey, most CEOs, regardless of the sectors in which they’re operating, are looking to Latin America and Asia – and to China in particular. 39% of CEOs think China is one of the three foreign countries which is most important to their company’s growth – and many of the customers they have are the T&L industry’s players,” says Alan Ng, PwC’s Transportation and Logistics Leader for China and Hong Kong.
PwC says global trade suffered a sharp decline in 2009, but bounced back robustly over the past year. It’s estimated to have ended 2010 above its 2008 peak. Trade as a proportion of world GDP is expected to increase in the short term, as the world economy gains strength and confidence. But in the coming years, the trade landscape will undergo fundamental change, as the emerging economies begin to play an increasingly critical role in the trade landscape.
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