China logistics seen to resist slowdown

China - The Chinese logistics industry will continue to produce double-digit growth rates in spite of the global economic slowdown, predicts a new report.

The Chinese logistics industry will experience some slowdown but will continue to report strong growth over the next five years, said a new report by Transport Intelligence (Ti).

The study projects the international express industry in China to report the fastest growth at about 23% a year to 2012. This is a dip from previous years where major players were reporting growth rates of 35-40%. "However given the economic environment this still represents significant progress and justification of the major investment plans of the leading integrators," the report said.

Ti believes the contract logistics market in China be driven by increased outsourcing to report a CAGR of 21.7% and reach a value of US$22.2 billion by 2011. 

The Chinese freight forwarding sector will be the worst impacted by the global slowdown, being most exposed to fluctuating volumes. In spite of this, Ti sees the market to record an annual average growth rate of about 13.5% between 2007 and 2011.

"Given that much of the developed world is on the brink of recession, it would be easy to write off prospects for growth in China on the false assumption that the market is solely dependent on western consumers," Ti CEO John Manners-Bell said.

"Although China is certainly not completely de-coupled from its export markets, the country's economic growth - forecast this year to be ‘only' 9.5% - has in recent years developed its own domestic dynamics. With the government planning to stimulate its economy further by investing in the coming year some of its huge reserves, China is a good bet to ride out the recession."