‘Region well placed to ride out economic storm’

The Asia Pacific transport and logistics market is entering a period of intense uncertainty as the effects of the global economic slowdown hit home. But despite the many problems, the region remains well placed to ride out the economic storm. That’s one of the findings of Asia Pacific Transport & Logistics 2008, the latest report compiled by UK-based research group Transport Intelligence. Two sectors in particular are showing signs of difficulty, according to the report. Freight forwarding has been one of the most affected sectors, with annual growth having contracted sharply in 2007 from 17.3% the previous year to 12.1%. That fall was due to weakening demand in the North American market as well as falling freight rates caused by overcapacity. The market wasn’t helped by Japan’s stagnating economy. The Asia Pacific region’s contract logistics market also saw lower levels of growth, albeit experiencing a less pronounced drop than freight forwarding, with a decline from 13% in 2006 to 11.4% in 2007. That would suggest that trends such as outsourcing and the longer term contractual relationships enjoyed by logistics operators and their clients may provide higher levels of resilience to the downturn. However, while signs of the slowdown are already being felt, Asia Pacific remains best placed to ride out the economic storm, according to Ti CEO John Manners-Bell