Global supply chain leaders expect weak economic environment in 2020
Just under a quarter of executives expect poor growth or a recession in the next year
A mere 27% of supply chain professionals surveyed for eft’s are optimistic about economic prospects in 2020 and expect a strong or extremely strong growth environment, according to eft’s new Supply Chain Hot Trends Report: 2020 & Beyond, which is available for free download now.
The default position among the remainder is an outlook of weak growth, with 48% seeing this as the most likely outcome over the course of the year. Although just 1% are preparing for a deep recession, 24% do see a small recession as being likely.
This does mean that sentiment overall is positive, with those seeing growth outweighing more pessimistic outlooks and marks a small improvement in sentiment from 2019 results, where 26.6% expected a recession.
However, those expecting the global economy to defy these results and soar in 2020, should note that the logistics sector’s economic fortunes in 2019 did broadly follow the results from eft’s 2019 survey. Although early demand was strong, coming off a record-breaking year of growth in 2018, momentum faded as the year went on and a series of signs showed that the industry was settling into a lower growth environment, from new truck orders falling, signs of overcapacity, subdued demand, and declining haulage and shipping spot rates.
Already, 2020 is off to a rocky start with coronavirus now almost certain to take the shine off global GDP growth and have a major effect on the transport and logistics sector as a number of supply chains become affected by the
Sentiment in the eft survey is above some others in the industry. Sixty-four percent of supply chain professionals surveyed for the 2020 Agility Emerging Markets Logistics Index believe a recession is likely over the course of 2020, compared to 12% of the 780 respondents who believe a recession unlikely. Although painting a more pessimistic picture for 2020, these results alongside eft’s survey paint a picture of a more subdued outlook in 2020.
For more on the trend shaping logistics in 2020, click here to download the report for free.