The study commissioned by DP World, the leading provider of smart logistics solutions, found that during 2022 trade is expected to expand further, due to a 16% increase in exports during 2021 and imports by 12%. Production levels have been unable to keep pace with demand leading to supply shortages and will limit import growth in 2022, according to the company's release.
The survey of 3,000 respondents, produced in partnership with Economist Impact captured perspectives of company leaders across the world. In addition to rising inflation, geopolitical tensions between the US and China continue to concern executives with 30% claiming that ongoing trade war between the US and China is the top reason to be pessimistic about global trade.
Despite the apprehension, and low production levels limiting imports, international revenue expanded for 68% of companies exporting freight in 2021, compared with 42% in 2020. 35% attributed that growth to an expansion of exports into new markets, as companies took advantage of new trade routes created by the pandemic.
To cope with the pandemic and ease inflationary pressures, companies are also changing their strategic outlook. 48% now said diversifying their supplier base is their primary reconfiguration strategy, with efforts focussed on sourcing raw materials (24%) and managing shipping lines and logistics (21%). The highest cited reason for optimism for global trade was the growth of technology to ease supply chain issues, particularly the adoption of 5G to increase connectivity.
Digitalisation can also streamline operations and increase efficiencies in trade. 67% of companies in the industrial sector are already using digital platforms for supply chain management. Businesses now have greater flexibility to move cargo faster, track progress in real time and automate customs clearance processes, helping address non-tariff trade barriers.
This is the second edition of the Trade in Transition report commissioned by DP World, produced in partnership with Economist Impact. It is a global survey that retrieves data from over 3,000 executives, examining their experience of the pandemic, confidence on government policies, supply chain pressures on the movement of trade around the world and ESG priorities in trade. The report deep dives into regional (North America, South America, Europe, Middle East, Africa, and Asia-Pacific) and sectoral data (FMCG, health and pharma, industrial) to compare and contrast priorities in international trade.
About DP World
DP World is the leading provider of worldwide smart end-to-end supply chain logistics, enabling the flow of trade across the globe.
The company delivers these services through an interconnected global network of 190 business units in 69 countries across six continents, with a significant presence both in high-growth and mature markets.