Friday, November 11, 2011

Freight And Logistics Professionals Will Appreciate New Analysis Of World Trade Links

DHL Comes Up with a Free Study of Countries Market Relationships
Shipping News Feature

WORLDWIDE – One of the advantages of working for a major corporation is the chance to investigate and publish facts and figures relevant to the market one is concerned with. The latest effort from DHL is worth a look by anyone deeply involved in the global freight and logistics trade, studying as it does the inter relationships between trading partners at a time when the economic situation calls for shipping groups to know exactly what their risks are in the international supply chain.

Today saw the release of the first DHL Global Connectedness Index (GCI), a comprehensive study of geo-political trade data. The study can be downloaded for free in full HERE but to précis the contents it indicates that economic globalization is still not as deep as perceived and the potential for continued economic integration could represent global gross domestic product gains of five percent to 10 percent per year. GCI ranks 125 countries according to the depth and breadth of integration into the world economy and examines the connections between global connectedness and welfare. The study documents that global connectedness has enormous room to expand, even among the most ‘connected’ countries.

The GCI study was unveiled against the backdrop of the APEC CEO Summit and Leaders' Week in Honolulu, a global summit where heads of state and business leaders meet annually to discuss international economic issues. The study was commissioned by DHL and conducted by world-renowned global business strategist and economist, Pankaj Ghemawat, Professor of Global Strategy at the IESE Business School, Barcelona. The Professor was the youngest person in history of the Harvard Business School to be appointed a full professor.

The initial GCI found that the ten most connected countries are the Netherlands, Singapore, Ireland, Switzerland, Luxembourg, the United Kingdom, Sweden, Belgium, Hong Kong (China) and Malta, the United States is of course notable by its absence, ranking only 25 despite its claims of increased trade integration. The diversity of the leading countries is even greater in the top 50 list, which includes representatives from all six continents. These patterns indicate that the benefits of connectedness are accessible to a broad range of countries, not just trading hubs that lead many other globalization indices.

Obviously the principal factors in the propensity for close trade ties are shared borders and cultural and historical ties but whilst larger countries score highly on the breadth of their connections their smaller cousins gain by the depth of penetration into their market partners. The views of Professor Ghemawat are very clear, he commented:

"Our research shows that global economic integration is not as deep as perceived. Therefore, we see untapped potential for growth for each country and globally. Increasing global connectedness is likely to spur further growth by adding trillions of dollars to the economic turnover."

Further information as to the methodology used in the study can be seen HERE together with an analysis of the management of the study HERE.