SE Asian countries on the up

South East Asian countries have improved their position in the 2015 Agility Emerging Markets Logistics Index, in part because of dynamic air cargo sectors.

The Index, now in its sixth year, is an annual data-driven ranking of 45 emerging economies accompanied by a separate survey of nearly 1,000 global logistics and supply chain executives.

Of the South East Asian countries Indonesia rose one place to fourth whilst Vietnam moved up two to 19th a smaller rise than that of the Philippines which rose three to 16th. Malaysia was unchanged at eighth in the Index as was Thailand at 14th.

Boosting Vietnam’s, and to a lesser extent the Philippines, position was their involvement in two of the fastest growing airfreight trade lanes from the US and the European Union (EU), although the Index considers a range of factors.

In a report on the Index, Agility reports volume from America to Vietnam rose a staggering 42.7 per cent to 20,397 tonnes in 2014 over the year before.

Airfreight from the EU rose by the lesser but still impressive 17 per cent to 29,237 tonnes.

The Philippines also saw a similar pattern. Airfreight volumes from the US rose 11 per cent to 20,953 tonnes and the EU by 8.2 per cent to 17,111 tonnes. By contrast Malaysia saw a modest increase of 2.7 per cent to 39,738 tonnes on its EU air cargo volumes.

Also helping the Philippines was growth up by nearly a quarter on outbound trade lanes to the US and a fifth to EU. Vietnam saw its outbound, to the US rise by a much smaller 7.1 per cent to the US and 5.1 per cent to the EU but remains in a clear winner.

“The attraction of lower wages compared to increasingly unfavourable labour market conditions in China has seen numerous multinationals invest heavily in Vietnam, particularly in the air freight intensive electronics sector,” Agility explains in a report accompanying the Index.

“Samsung, Intel and LG are investing billions in new factories, with Samsung alone importing and exporting $11.3  billion and $12.5 billion of goods in and out of Vietnam in 2012 respectively. It is worth noting that Vietnamese growth is a long term trend, with air imports from the US and EU growing at an average rate of 19.2 per cent and 12.2 percent per year respectively from 2005- 20,” it adds.