Global logistics executives have cited recessionary signals and China's weakened economy as key factors which could limit their business this year.
A survey of 830 industry professionals by Agility found that as well as being concerned about negative growth, logistics chiefs are still battling higher costs, seeking to reduce dependence on sourcing from China, and planning to boost investment in Africa despite the risks of emerging markets investment.
Although the amount of logistics leaders anticipating recession has dropped to around 50% - down from nearly 70% a year ago - more than 63% of respondents say their companies continue overhauling supply chains by spreading production to multiple locations or relocating it to home markets and nearby countries.
China, the world's leading producer, stands to be most affected: 37.4% of industry professionals say they plan move production/sourcing out of China or reduce investment there.
Europe may benefit from supply chain restructuring, with India, Europe and North America now ranking ahead of China as destinations executives expect to move production to in 2024 and onwards.
Agility vice chairman Tarek Sultan said: 'Shippers and carriers are struggling to minimise supply chain risk and find new growth opportunities.
'Inflation and recession risks have eased, but the industry is still living with the aftershocks of the Covid pandemic. At the same time, businesses are worried about geopolitics - troubled trade relations between China and the US and Europe, and the thicket of sanctions against a growing number of countries.'
Rising costs
Shipping and logistics costs that soared during the Covid pandemic and its aftermath are still climbing but at a slower rate, the survey found. One way shippers expect to cope is by increasing use of digital freight forwarding from 37.8% today to 52% in five years.
Meantime, the industry is gearing up for a surge in Africa investment. Nearly 62% of professionals say their companies are planning additional or first-time investments in Africa vs. only about 7% exiting or scaling back there.
China and India, the world's two largest countries, held their spots at No. 1 and 2 in the overall rankings. UAE, Malaysia, Indonesia, Saudi Arabia, Qatar, Vietnam, Mexico, and Thailand rounded out the top 10. No. 24 South Africa and 25 Kenya were highest among countries in Sub-Saharan Africa.
Outside of the top 10, many of the biggest swings in year-to-year rankings involved countries experiencing conflict, facing international economic sanctions, or suffering from chronic economic instability. Among them: Ukraine, Russia, Iran, Ethiopia, Argentina, Lebanon, Tunisia.
