Top 20 Emerging Logistics Markets in 2022: Growth, Opportunities, and Insights
Introduction
The Agility Emerging Markets Logistics Index is an annual ranking of emerging markets based on their logistics performance. It evaluates countries based on their market size and growth attractiveness, market compatibility, and market connectedness. The 2022 index highlighted China, India, and the United Arab Emirates as the top three emerging logistics markets. In this article, we will analyze the top 20 countries on the list, providing insights into each country's logistics landscape.
China (8.50): China's logistics industry has grown tremendously due to its expanding economy and global trade. The country boasts an extensive transportation network comprising railways, highways, airports, and seaports. Key infrastructure projects like the Belt and Road Initiative have also expanded China's trade connections with other countries. Furthermore, China's logistics market has seen rapid digitalization, with giants like Alibaba and JD.com investing heavily in improving their supply chains and delivery networks.
India (7.21): India has been making strides in modernizing its logistics sector. It has implemented the Goods and Services Tax (GST) to streamline taxation, reduce costs, and improve supply chain efficiency. Additionally, India's investment in dedicated freight corridors, such as the Delhi-Mumbai Industrial Corridor, has facilitated faster and more efficient cargo movement. The Indian government is also working to establish Logistics Parks to provide end-to-end logistics solutions and reduce transportation costs.
United Arab Emirates (6.72): The UAE has leveraged its strategic location between Asia, Europe, and Africa to establish itself as a prominent logistics hub. Key logistics zones like the Jebel Ali Free Zone and Dubai Logistics City have attracted multinational logistics companies. The country has also invested in aviation infrastructure, with airports like Dubai International and Al Maktoum International becoming significant cargo hubs. Moreover, the UAE's regulatory environment is business-friendly, which has encouraged investment in the logistics sector.
Malaysia (6.32): Malaysia's logistics sector benefits from its strategic location within ASEAN and proximity to major shipping routes. The country has focused on improving its port infrastructure, with major facilities like Port Klang and Port of Tanjung Pelepas handling substantial cargo volumes. Malaysia has also been developing its rail and road networks to enhance connectivity between its industrial zones, ports, and neighboring countries.
Indonesia (6.17): Indonesia, an archipelago of more than 17,000 islands, faces unique logistical challenges. The government has made substantial efforts to improve its maritime infrastructure through projects like the Sea Toll Road, which aims to enhance connectivity between its islands. Investments in road, rail, and air transportation have also helped boost its logistics performance. Moreover, the growth of e-commerce in Indonesia has accelerated demand for efficient logistics solutions, leading to increased investments in this sector.
Saudi Arabia (6.14): Saudi Arabia's Vision 2030 plan aims to diversify its economy and includes significant investments in logistics and transportation. Projects like the King Abdullah Port and the Jeddah Islamic Port have expanded the country's maritime capabilities, while the Saudi Landbridge project aims to improve rail connectivity between its major cities. The country has also been developing logistics hubs, such as the King Abdullah Economic City, to facilitate trade and attract foreign investment.
Qatar (5.95): Qatar's logistics sector has benefited from its strategic location and investments in infrastructure, such as the Hamad Port and the new Hamad International Airport. The country has also developed key logistics zones, like the Ras Bufontas Special Economic Zone, to attract international logistics players. Qatar's growing construction and industrial sectors have driven demand for more efficient logistics services, further boosting the industry.
Thailand (5.78): Thailand's logistics industry is supported by its strategic location in Southeast Asia and well-developed infrastructure. The country has been investing in the Eastern Economic Corridor (EEC), which aims to establish advanced logistics networks and improve connectivity with neighboring countries. Key projects under the EEC include the expansion of Laem Chabang Port, the development of the high-speed rail network, and the construction of new motorways. These initiatives are expected to enhance Thailand's logistics capabilities and attract foreign investment.
Mexico (5.74): Mexico's logistics sector has grown significantly due to its strategic location, sharing a border with the United States and access to both the Atlantic and Pacific oceans. The country has been investing in infrastructure projects, such as expanding the Port of Veracruz and developing the T-MEC Corridor to improve rail connectivity. Mexico's participation in the United States-Mexico-Canada Agreement (USMCA) has further increased trade opportunities and demand for logistics services.
Turkey (5.69): Turkey's strategic location as a bridge between Europe and Asia has positioned it as an essential logistics hub. The country has been investing in transportation infrastructure, including the construction of the Istanbul Airport, the Marmaray rail tunnel, and the Yavuz Sultan Selim Bridge. Turkey's logistics sector has also benefited from the growth of its e-commerce market, driving the demand for more efficient logistics solutions.
Vietnam (5.55): Vietnam's rapidly growing economy and increasing trade with other countries have fueled demand for better logistics services. The country has been focusing on improving its infrastructure, with key projects like the Lach Huyen International Gateway Port and the expansion of its highway network. Vietnam's burgeoning e-commerce market has also driven the growth of its logistics sector, with international players like DHL and Maersk investing in the country.
Chile (5.55): Chile's logistics sector has been growing steadily, supported by its stable economy and well-developed infrastructure. The country has focused on enhancing its port facilities, such as the expansions of the Port of San Antonio and the Port of ValparaÃso. Chile's participation in various free trade agreements has also boosted its trade activities, increasing the demand for efficient logistics services.
Russia (5.53): Russia's vast territory and abundant natural resources have contributed to the growth of its logistics sector. The country has been investing in infrastructure projects like the Northern Sea Route, which aims to improve maritime trade connections between Europe and Asia. Additionally, the development of new railway lines and highways has helped to enhance Russia's domestic and international logistics capabilities.
Oman (5.41): Oman's strategic location near the Strait of Hormuz has positioned it as a key logistics hub in the Middle East. The country has invested in the development of the Port of Duqm, the Salalah Free Zone, and the Sohar Industrial Port, which have attracted international logistics companies. Oman's government has also focused on improving its road and rail networks to enhance connectivity within the country and with neighboring countries.
Bahrain (5.28): Bahrain's logistics sector has benefited from its strategic location and business-friendly environment. The country has invested in the development of the Khalifa Bin Salman Port and the Bahrain Logistics Zone, which have helped to attract international logistics players. Bahrain's efforts to improve its road, air, and sea transportation infrastructure have also contributed to the growth of its logistics industry.
Brazil (5.25): Brazil's large domestic market and abundant natural resources have driven the demand for logistics services. The country has been investing in infrastructure projects, such as the expansion of the Port of Santos and the construction of new highways and railways, to improve its logistics capabilities. Brazil's participation in the Mercosur trade bloc has also facilitated trade with its neighbors, further boosting its logistics sector.
Kuwait (5.21): Kuwait's oil-rich economy and strategic location have supported the growth of its logistics industry. The country has been investing in key infrastructure projects, such as the development of the Mubarak Al Kabeer Port and the construction of new highways. Kuwait's government has also established the Kuwait Logistics City, aiming to create an integrated logistics hub that attracts international players and facilitates trade.
Philippines (5.16): The Philippines' archipelagic geography poses unique challenges to its logistics sector. However, the country has been making significant efforts to improve its infrastructure, including the development of the New Clark City and the expansion of the Subic Bay Freeport Zone. The Philippines' growing e-commerce market has also driven demand for efficient logistics services, leading to increased investments in this sector.
Jordan (5.13): Jordan's strategic location at the crossroads of Asia, Europe, and Africa has made it an attractive destination for logistics investments. The country has been investing in the development of the Aqaba Special Economic Zone and the expansion of the Queen Alia International Airport. Jordan's focus on improving its road and rail networks has also helped enhance its logistics capabilities and facilitate regional trade.
Morocco (5.04): Morocco's logistics sector has benefited from its strategic location near Europe and its participation in various trade agreements. The country has been investing in the development of the Tanger Med Port and the construction of new highways and railways, such as the Al Boraq high-speed rail line. Morocco's government has also established the National Strategy for Logistics Competitiveness, aiming to improve its logistics performance and attract foreign investment.
Conclusion
The Agility Emerging Markets Logistics Index 2022 highlights the growth and potential of the logistics sector in emerging markets. These countries have been investing in infrastructure development and implementing policies to enhance their logistics capabilities. As these markets continue to grow, their logistics sectors will play a crucial role in facilitating global trade and supporting their economies. By understanding the unique factors driving the growth of logistics in each of these countries, businesses and investors can better navigate these markets and capitalize on the opportunities they present.
