Strong outlook for manufacturing in the Asia Pacific region predicted

Manufacturing has emerged as the most significant economic activity in powering growth in emerging regions over the next five years, according to the Agility Emerging Markets Logistics Index 2022.

Primary manufacturing and advanced/value-added manufacturing will be the most significant economic activities powering growth in the Asia Pacific region over the next five years, according to respondents. “The strong outlook for manufacturing production in the region is underpinned by the rapid expansion forecast of the global economy. Semiconductor manufacturing will continue to play a prominent role in powering growth in the region,” the report noted.

The boom in global semiconductor demand that has supported growth to key Asian exporters, including Malaysia, will likely hold up and speed up the recovery.

For the remaining emerging regions, extractive industries, mining and agriculture will be the most significant economic activities to power growth over the next five years, according to the survey findings. These sectors will be particularly important growth drivers for the Sub-Saharan Africa region. Agriculture holds a high share in GDP in the region and as a result, the prospects of the agricultural industry considerably influence economic development in Sub-Saharan African countries. Trade under the African Continental Free Trade Agreement officially started on 1 January 2021. According to recent estimates by the UN Economic Commission for Africa, the agreement is projected to increase intra-African trade of agriculture and food products by 20-35 per cent (or $10-17 billion). Key risks and trade barriers will remain the high costs of road transport, due to the region’s poor infrastructure and border inefficiencies.