Emerging markets’ export growth have rebounded amidst the pandemic, reaffirming their position in global supply chains. This is further aided by their capacity to export high-technology products
China remains the world’s top global exporter, followed by traditional leaders in the EU, USA and developed Asia. However, a rise in the exports of emerging markets have begun to compete for these top spots. Various developing markets in Asia and the rest of the world have gained the capacity to supply higher value-added manufactured products. Increased importance should be placed on appropriate supplier diversification and making the correct supply cluster & category choices.
Trends: Amongst emerging markets, China continues to be both the world’s largest exporter as well as export leader amongst developing countries
- China remains on top, however countries such as Mexico, Vietnam and India are vying to position themselves higher on the global export rankings
- Vietnam’s export growth rate exceeds that of other emerging markets at a CAGR of 14.6% from 2010-2020
- Most of the emerging markets in the top 30 global exporters focus on manufactured goods, except for Brazil having only 1 of its top 10 products falling in this category
Upshot: Emerging markets, especially in Asia, are poised to meet a greater share of the global demand for manufactured goods
- The top 30 global exporters in 2020 are expected to see dramatic increases in their exports in 2021 following an average decline of 6.2% in 2020 amongst these export leaders
- In high-technology manufactured goods (i.e., integrated circuits), Asian supply markets such as China, Vietnam, Malaysia & Thailand will be leveraged to meet the demand, with existing expertise in this product category playing a crucial role amidst a global shortage
- Emerging markets outside Asia are broadly expected to continue growing fast, following gains made by China, Vietnam and Poland in 2020
Imperatives: Understanding which market to focus sourcing efforts on is becoming increasingly important as more supply clusters emerge for certain product categories
- Procurement managers must continue to look at which markets to diversify to according to their appropriate product category requirements
- Continue to monitor the growth of emerging markets such as Vietnam, Poland & Mexico who are climbing the global export rankings to compete with traditional leaders
- Leverage supply clusters in Asia, Latam & Eastern Europe that excel in certain product categories
For more on Axis Group International’s Global Procurement & Supply solutions, email us at solve@axisgroup-international.com.
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