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Trade in Transition outlines key supply chain pillars

DP World and Economist Impact have found three key forces will shape Asia Pacific supply chains in the foreseeable future

The 2025 Trade in Transition report has found businesses in the Asia Pacific region are creating parallel supply chains in order to mitigate risk and avoid disruptions caused by geopolitical conditions.

The report, which was released by Economist Impact and DP World at the World Economic Forum in Davos, surveyed over 3500 supply chain executives across the world.

It details 33 per cent of businesses in the APAC region are creating these parallel supply chains, while 29 per cent of businesses are creating dual supply chains to cater for the Chinese and US markets.

These dual supply chains will help manage regional pressures faced by the rising trade tensions between the two economic powerhouse nations and allow businesses to pivot if needed.

This has seen production hubs in other Asian countries like Thailand and Vietnam gather momentum as part of a ‘China Plus One’ strategy.

CEO and Managing Director of DP World Asia Pacific Glen Hilton says this diversification is integral to the goal of continuing to strengthen global supply chains.

“The Asia Pacific region is in an era of significant transformation,” Hilton says.

“As businesses in the region implement bold strategies – diversifying supply chains, capitalising on regional trade deals and adopting frontier technologies – to drive expansion, they must also balance ambition with caution to sustain momentum in the face of global geopolitical instability.”

The adoption of new technologies has also been identified as a key driver of supply chain efficiency to help counter labour shortages and enhance efficiency.

36 per cent of APAC business leaders have reported significant reductions in trade operation costs, while 28 per cent have seen improvements in resource planning and supply chain efficiency.

Global Lead of New Globalisation at Economist Impact John Ferguson says new technology looms as one of three key pillars that will continue to shape global trade.

“In 2025 and the foreseeable future, global trade will be shaped by three forces,” Ferguson says. “Shifting geopolitics, climate change, and a new wave of AI and automation.

“Yet, businesses are not retreating from international trade but are stepping up to the challenge.

“Firms that stay agile and cost-efficient will have the edge. Firms that also combine risk management with AI experimentation and openness will be best placed to win this new chapter of globalisation.”

Click here to view the APAC Trade in Transition report. Click here to view to Global Trade in Transition report.

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