Amidst a wave of supply chain restructuring, executives are eyeing India, Europe, and North America as preferred production destinations over China, reveals a recent report. The findings stem from the “15th annual Emerging Markets Logistics Index” conducted by a prominent supply chain services provider.
According to the survey encompassing 830 logistics executives, 40% anticipate reduced reliance on China within five years. Key drivers for this strategic shift include challenges in conducting business, trade tensions between the U.S. and China, economic slowdown, and stringent COVID-related measures in China.
In light of global trends, the survey notes a continuous rise in shipping and logistics costs post-COVID, albeit at a slower pace. Moreover, over 63% of respondents indicate ongoing supply chain overhauls, involving diversification of production locations to mitigate risks. Notably, China, as the world’s top producer, faces potential production relocation or reduction by 37.4% of industry professionals.
Looking towards new horizons, Africa emerges as a promising destination for supply chain and production investments. Nearly 62% of logistics professionals express intentions for additional or initial investments in the continent, buoyed by optimism despite concerns over emerging market risks. This positive outlook underscores Africa’s demographic potential, with its population projected to double by 2050, signaling vast growth opportunities.
While China and India maintain top positions in the index rankings, Africa showcases robust potential across 14 countries. Egypt, Morocco, South Africa, and Kenya lead the pack, offering favorable logistics opportunities, international connectivity, strong business fundamentals, and digital readiness, respectively.
With a workforce spanning six continents, the supply chain services provider plays a pivotal role in facilitating global trade. Offering diverse services ranging from aviation and fuel logistics to real estate development and e-commerce enablement, the company remains instrumental in supporting businesses navigating the evolving supply chain landscape.