Dubai: Inflationary surges and geopolitical tensions top the list of concerns for the world’s logistics industry over the next 5 years. That’s according to a new survey from DP World, the Dubai port and free zone operator.
It is forcing supply chain operators to bring about major changes, with 10 per cent saying they changed the markets they do business due to uncertainty. “These worries look set to dominate the thoughts of freight forwarders for years to come,” the DP World poll finds. Worryingly, two-thirds of freight forwarders state it is ‘impossible to say’ when economic disruptions will subside.
The findings were revealed as at the Global Freight Summit, a three-day conference hosted by the Dubai entity.
“Global supply chains are significantly impacted by the pandemic, geopolitical tensions and the looming threat of the global climate change crisis,” said Sultan Ahmed Bin Sulayem, Group Chairman and CEO of DP World. “In fact, these challenges have demonstrated that many parts of the global supply chain infrastructure are fragile. These rising concerns makes it imperative for logistics operators to come up with the tools and solutions that offer real-time visibility across the entire supply chain. This can allow trade routes to be fit-for-purpose, and thus facilitating a more seamless movement of trade around the globe.”
The global supply chain industry has now become inured to confronting multiple issues. 2020 and the pandemic completely upended the smooth running of operations across all region. That disruption came with container rates escalating, and in many cases not having enough availability.
This continues even with Covid out of the way. “Challenges that freight forwarders are experiencing include rising and unpredictable freight rates, with 80 per cent highlighting this as the biggest worry keeping them awake at night,” the DP World survey finds. “The lack of financing options is another major issue, with 37 per cent of those surveyed saying this has a crippling effect on their ability to deliver goods.
"The uncertainties of today’s world are making trade harder and it is increasing the disconnect at various points across the whole supply chain,” said Mike Bhaskaran, Group Chief Operating Officer, Digital Technology at DP World. “The freight forwarding community must come together to act now to mitigate risk, so that we can build towards a more resilient future.”
Over half said it has increased pressure on management to operate more sustainably.