FAR EAST\\\


Manufacturing is on the move – but only slowly


Arthur da Silva, chairman of Hong Kong-based forwarder Jetspeed and vice-chairman of the WACO global network confirms that some manufacturing is moving away from the coastal regions of China to Western China or inland and also to new locations like Vietnam, Cambodia and Myanmar due to cost reasons. He explains: “That is why


WACO has members in Vietnam, Cambodia and Myanmar and we are considering opening new offices in Western China. This


move away however is gradual and not a very fast process due to the quality of goods in Vietnam, Cambodia and Myanmar not being on par with China. Infrastructure in those countries, especially ocean carriers and airline operations


is not as


efficient and frequent as Southern China and Shanghai.” He adds that while, traditionally


the freight flow from the Far East has been to Europe but with the affluence of the population in India and particularly China there


U-Freight adds Sri Lanka recruit


Hong Kong-headquartered international freight services and logistics specialist, the U-Freight Group has recruited Sri Lankan forwarder Care Logistics of Colombo as its latest agency partner. U-Freight chief executive


officer, Simon Wong described the latest addition as “a dynamic freight forwarding business, which has gained recognition within the Sri Lankan freight community within a short period.” With the end of civil unrest on the island nation in May 2009,


the Government of Sri Lanka was determined to reap a peace dividend taking advantage of Sri Lanka’s strategic position on key shipping routes between India and China and has set a growth target of 8% or more per year. Care Logistics, founded in


1997, offers a full range of freight forwarding services, including air freight, sea freight, customs brokerage, warehousing, supply chain management, project cargo logistics and out-of-gauge traffic. Mr Wong continued: “As part of its return to a peaceful normality,


the Colombo government is establishing vocational training for the population and providing low-interest finance and begun rebuilding roads and bridges all over the island. International and domestic banking is recovering while big retail chains are opening locations, which is giving a significant boost


to import and export


traffic and the freight forwarding services that are associated with it. We intend to capitalise on that business through our new agency partnership with Care Logistics.”


Japan forwarders look beyond their borders


Famous Pacific Shipping Group, as one of the world’s leading NVOCCs, has recently opened consolidation box services from Osaka and Kobe to Hong Kong, China (Xingang, Qingdao, Dalian, Shanghai), Taiwan, Thailand, Singapore, Indonesia, Malaysia, Vietnam and, from March, new destinations in India – Nhavasheva and Chennai. General manager of FPS


Japan, Nobuaki Naruoka explains: “This decade, the Japanese Yen was strong against foreign currencies, such as the US dollar and Euro. Many Japanese manufactures shifted their production lines from Japan to China or south- east Asia. So the export market from Japan is actually getting smaller and smaller - and then our economy was getting


worse and became deflated.” A change of government in 2012 brought with it a new direction, and, says Nobuaki Naruoka the economic situation is getting better, although small and medium sized companies have not yet felt the benefits. Nobuaki Naruoka adds: “In April 2014, Japan’s consumption tax (similar to VAT) will be changed from 5% to 8%, so we think our economy will be cooling down at that moment (and) we may not able to expect big growth in Japan. But


recently some


Japanese factories in China have shifted their production to countries in south-east Asia, such as Cambodia, Vietnam or Thailand due to increasing labour costs and worsening government relations. So China may still have some economic


growth, but will slow down.” The potential for growth


will instead pass to South-east Asian in the next decade. While there are still issues in these countries, such as impending elections and infrastructure, Japanese


companies are


looking to increase business with them, “so we may expect increasing


cargo movement


between such countries (though not through Japan).” That means, in turn that


forwarders will need a strong network to adapt to such changes, so large Japanese forwarders are setting up offices in these countries on order to follow their customers. Forwarders need not only


inbound and outbound services but also ‘triangle’ or cross-trade operations.


is now a strong eastbound freight moving from Europe to India and Europe to China.


Issue 2 2014 - Freight Business Journal


35


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