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Mark Millar MBA, FCILT, SCOR-P, FHKLA, FCIM, GAICD
Speaker, Moderator, Advisor, Author
Mark Millar leverages over 30 years global business
experience to provide value for clients with informed
and independent perspectives on their supply chain
strategies in Asia.
Acknowledged as an engaging presenter who delivers a
memorable impact, Mark has completed more than 450
speaking engagements at corporate events, client
functions and industry conferences across 28 countries.
A Visiting Lecturer at Hong Kong Polytechnic University,
Mark is recognised as one of ‘Asia’s Top 50 Influencers in
Supply Chain and Logistics’; in the USA listing of 'Top
Pros-to-Know in Supply Chain‘ and 'China Supply Chain
Top 20' .
Mark’s book “Global Supply Chain Ecosystems strategies for
competitive advantage in a complex, connected world”
was commissioned by leading business publisher Kogan
Page of London.
www.markmillar.com
5. © www.markmillar.com7Source: ICC
Globalisation Generation – 3 Key Drivers…
3 decades of Globalisation resulted in todays Global Supply Chains
• Outsourcing: Who
• Off Shoring: Where
• Un-Bundling: How
• Cross-border movement of goods ~40% of global GDP
• One-third of all Goods Produced are traded Cross-border
6. © www.markmillar.com9
Trade becoming concentrated within Regions
- Proximity to Customers, Speed to Market
Source: McKinsey: Globalisation in Transition 2019
Intra-regional trend is most pronounced within EU-28 and Asia Pacific regions
Share of Intra-Regional goods trade by region
Percent of trade (imports and exports)
7. © www.markmillar.com10Source: IMF 2019
% of
Global
GDP
Developing & Emerging
Advanced Economies
Globalisation impact:
- reduces Advanced Economies share of Global GDP
- benefits Developing Markets..
9. © www.markmillar.com12
Emerging Markets Developing…
Source: Focus Economics, IMF 0419
Emerging Markets’ Trade:
46% is with other Emerging Markets
Developed Market Exports:
30% go to Emerging Markets
2019 GDP Growth
Global 3.3%
• Developed 1.8%
• Emerging 4.4%
10. © www.markmillar.com14Source: BBVA Research, IMF
Asia-Centred World
Economic Centre of Gravity continues to shift East
Regional Contribution to World GDP Growth, 2015-2025
Global Growth concentrated in Asia = 61% of GDP Growth 2015 through 2025
Asia: Full Spectrum of Economies, Internal Tensions, Economic Dependencies
11. © www.markmillar.com15
The Asian Century:
One Region, Multiple Markets, 3 Mega Markets
India
ASEAN
China
3 mega markets comprise ~ 3,000,000,000 people…
Year 2030
China + India
= 35% of global
population
14. © www.markmillar.com20
Export Manufacturers
200 companies surveyed
37% had transferred production in past year
33% plan to do so in next 6-12 months
Trade War Impact
US Retail
Tariffs reduce 2019 Retail Sales by US$40bn
Lead to the closure of 12,000 stores in USA
- 7,150 US Retail Store closures already announced
- Last year, >5,500 US stores closed
Source: UBS 0519; Survey 1118
17. © www.markmillar.com24
US Companies in China…
- Survey of 250 companies, May 2019
✓ 35% adopting “In China, for China” Strategy
✓ 33% delaying / cancelling Investment Decisions
✓ 20% experience Increased Customs Inspections
✓ 19% experience Slower Customs Clearance
✓ 40% considering / have Relocated Manufacturing
- to South East Asia 24%; Mexico 10%; USA <6%
Source: AmCham’s in China, 0519
19. © www.markmillar.com26
Cherries
- China imposed Tariff on Cherry Imports
• US largest Origin
• China largest Destination
• 65% China’s imports
come from USA
• China’s Cherry Tariffs
impact 18,000 tonnes of
air cargo pa
Source: Seabury
? US Export alternatives? - to Korea, Japan, Taiwan, Hong Kong
? CN Import alternatives? - from Chile, Australia, New Zealand
20. © www.markmillar.com27
Trade War Winner: Vietnam
• Q1 Exports to USA + 40% YoY
• 2019 forecast 6.7% GDP Growth
• FDI 2019 through May +69% YoY
• Automated Customs Management 2019
• Textile sector exports f/c 15% growth in 2019
• FTA – CPTPP, EU-VN, within ASEAN
• High wage growth driving Private Consumption
• 98m px, SEA’s fastest growing middle class
BUT
• Labour Productivity
- esp in Apparel, Leather, Footwear
• Infrastructure, Capacity, Inflation
21. © www.markmillar.com28
Trade War Winner: India
• Large Pool of Engineers
• Young Labour Force
• Low Wages v China, SEA
• Gov Policies
• Tax Reforms, IPR,
• Made in India
• FTA’s including ASEAN
• Domestic Consumption
BUT:
• Complex Regulations
• Infrastructure
• Red Tape
22. © www.markmillar.com30
Washing Machine Story 2013-2018
US Washing Machine Imports
2013 US tariffs on imports from Korea
Korean brands moved production to China
2016 US tariffs on imports from China
Korean brands moved production to SE Asia
2018 US tariffs on ALL imports
US Consumers pay more
Korean brands announce set up factories in
USA
Source: Seabury
29. © www.markmillar.com39
Regional Supply Chains – Business Benefits
Proximity of Production to Consumption
✓ Shorter Distance
✓ Lower Cost
✓ Easier to Manage
✓ Closer to Market
✓ More Responsive
✓ Less Risk
33. © www.markmillar.com44
Key Criteria:
1. Large Contiguous
Land Mass
2. Advanced Road &
Rail Infrastructure
3. Low-Friction Internal
Borders
Ground Networks – Developed Markets
- efficient Road & Rail Freight Transport solutions
Source: Global Supply Chain Ecosystems
34. © www.markmillar.com45
Ground Networks – Emerging Markets
- NOT so efficient Road & Rail Freight Transport
Source: Global Supply Chain Ecosystems
Asia Region Infrastructure Investment USD 880bn pa
Domestic Network,
w internal borders
Domestic Network,
w internal borders
Shanghai to Singapore
Multiple
Border
Crossings
37. © www.markmillar.com48
City Clusters drive need for City Logistics…
Scale & Density together with Technology & Sustainability
- will drive new City-Centric business models for downtown distribution
2. Leading Economies pursuing Smart Cities
1. Populations Concentrating in Mega Cities
38. © www.markmillar.com51
Smart City + City Logistics? = Smart Logistics!
- leverage Sensors, IoT, Cloud Connectivity
- optimise both Distribution and Liveability
Source: Mark Millar whitepapers
44. © www.markmillar.com59
Global Supply Chain Ecosystems - strategies for
competitive advantage in a complex, connected world - by Mark Millar
✓ Commissioned by leading business publisher Kogan Page of London
✓ View Endorsements & Reviews from Industry Leaders
✓ Order online from the Mark Millar Digital Library