How is infrastructure linking supply chains in Asia?
21 Aug 20235 min read
Summary
- Asia is strengthening its supply chain network through extensive infrastructure development driven by globalization, technological advancements, and evolving consumer demands. Robust infrastructure, including ports, railways, and communication systems, is vital to enhancing manufacturing, logistics, and the overall flow of goods and information.
- Countries such as China and Vietnam are leading the region’s infrastructure push. China’s Belt and Road Initiative promotes connectivity across continents, while Vietnam invests around 6% of its GDP in infrastructure to sustain rapid economic growth and support key sectors like manufacturing and processing.
- Modernization and sustainability are shaping the next phase of Asia’s infrastructure. Smart ports like Shanghai’s Yangshan Port exemplify automation and zero-emission operations, while green investments and public-private partnerships drive climate-resilient growth aligned with COP26 goals. The Asian Development Bank estimates the region needs $1.7 trillion annually in infrastructure investment to sustain development and address climate challenges.
The establishment of a more robust network across supply chains in Asia experienced an increase in attention to infrastructure development. Said trend is being driven by various factors such as globalization, technological advancements, and changing consumer demands.
Asia is gradually emerging as a major manufacturing and trading hub. Wherein, the existence of a highly-functional infrastructure could impact operations from manufacturing to logistics.
An infrastructure can refer to ports, airports, railways, roads, warehouses, communication networks, storage, and other facilities. All of these help enable the movement of goods, services, and information along the supply chain.
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“There is little doubt that investments in infrastructure help the economic development of the receiving country,” said Raymond Yamamoto, an expert on Japanese official development assistance and Associate Professor at Aarhus University in Denmark.
Noteworthy infrastructure drives economic progress
Mobility makes the circumvention of services and goods amicable. And China's Belt and Road Initiative (BRI) is one of the significant related initiatives to date.
The BRI enhances connectivity and promotes economic cooperation among countries along the ancient Silk Road trade routes. It facilitates the movement of goods between China, other Asian countries, Europe, and Africa. Such is through the creation of new trade routes and the expansion of existing ones.
Modernization of ports
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“The cornerstone of the economic welfare of any country is the presence of a performing infrastructure. Seaports are a critical part of this infrastructure and essential to boost and support the economic development. In that respect, any plan to modernize and revitalize the port system should be encouraged,” Luc Arnouts, Vice President of International Relations and Networks, Port of Antwerp-Bruges said.
Sustainability
There is a growing movement on green infrastructure in Asia. It consists of renewable energy projects, sustainable buildings and transportation systems.
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