Global Logistics—August 2013

Global Logistics—August 2013

America’s Global Image: Taking a Closer View

Yahoo! News paints a pretty grim picture of how outsiders perceive the United States: "Who loves ya, baby? If you’re the United States of America, the answer is fewer and fewer people around the world," according to a recent blog by the online news aggregator.

Yahoo! might consider double-checking its source, Pew Research. The non-partisan fact tank offers the opposite assessment in its recent Global Attitudes project—a survey conducted in 38 countries among 37,653 respondents from March 2 to May 1, 2013.

"Overall, global attitudes toward America are positive," says Pew Research. "In 28 of 38 nations polled, half or more of those surveyed express a favorable opinion. And across these nations, a median 63 percent have a positive view of America."

The United States receives high ratings in most of Europe, Latin America, the Asia/Pacific region, and Africa. That sentiment is muted in predominantly Muslim nations; and only 40 percent in China see the United States in a favorable light.

Most intriguing is how other countries perceive the world’s two leading economies. While many believe China is poised to eventually become the dominant world player—since 2008, the median percentage naming the United States as the world’s leading economic power has declined from 47 percent to 41 percent, while the median percentage placing China in the top spot has risen from 20 percent to 34 percent—America’s image is seen more positively (63 percent vs. 50 percent) and less negatively (30 percent vs. 36 percent) compared to China.

Taken for what it is, this is a referendum on how most global observers view a totalitarian political regime that denies personal liberties and, in terms of trade, has a tendency to exploit rather than engage.

Parsing why certain countries feel the way they do presents an interesting study. Cultural and political affinities shape perception. The Philippines, El Salvador, Israel, Korea, and Italy—all among the top 10 countries that have a favorable opinion of the United States—share long and storied military and/or diaspora histories.

Commerce is a platform for tolerance as well. Israel and Korea have free trade agreements with the United States. Brazil is the top South American destination for U.S. foreign direct investment. With the exception of China (India and Saudi Arabia are not included in the Pew Research survey), the top 10 U.S. import and export partners hold a favorable opinion of America.

Africa shares kinship with the United States as well; less so economic synergies. The fact that Ghana, Senegal, Kenya, and Uganda have such high esteem is surprising. U.S. economic aid offers one explanation. Pew Research suggests another.

"America enjoys a soft power advantage over China among Latin Americans and Africans," according to the report. "Many embrace American scientific and technological achievements, ways of doing business, and popular culture. The appeal of U.S. soft power is generally stronger today in Latin America and Africa than it was during the final years of the Bush administration."

African nations, and much of South America (Brazil, Chile, and Venezuela), seem easy to please, as they generally share positive vibes about China as well. But why shouldn’t they? Both continents are courting foreign investment they hope will help build a foundation for economic growth.

On the other side of the like-dislike continuum there is a clear division over political ideology and U.S. foreign policy. Negative perceptions among countries in the Middle East/North Africa and Mediterranean regions are largely predicated on U.S. support for Israel.

The Heritage Foundation’s annual Index of Economic Freedom also offers insight into these dissenters. It defines economically free countries as those that "allow labor, capital, and goods to move freely, and refrain from coercion or constraint of liberty beyond the extent necessary to protect and maintain liberty itself."

With the exception of Jordan and Turkey, the 10 countries with the least favorable attitude toward the United States are "mostly unfree," according to the Heritage Foundation’s index. It’s little wonder that politically, socially, and economically repressed nations see America’s "freedom" as anathema to their worldview.

Jordan presents an interesting case. It has long shared a strategic alliance with the United States since it gained independence following World War II. Yet Jordan has the second least-favorable opinion — and it is a U.S. free trade partner. The country also ranks very high globally in terms of economic freedom (33rd).

Egypt, too, holds a very negative view of the United States. Still, it leads the Middle East and all of Africa in terms of U.S. FDI at $14 billion, according to the most recent Bureau of Economic Analysis figures. U.S. aid to Egypt, given its current socio-political climate, has been a hotly debated topic on Capitol Hill. But the Suez Canal is an important pivot in world trade, especially with regards to oil. Stability in Egypt and Middle Eastern accord are intrinsically linked. Remarkably, Egyptians feel that U.S. aid is having a negative impact in their country, according to Pew Research.

Turkey’s general loathing for both the United States (21 percent) and China (27 percent) is notable. The United States has high hopes for Turkey as it continues along the path toward democracy. Located along the Suez trade at the nexus between Europe and Asia—and sharing borders with both Syria and Iran—Turkey is one country where the United States would like to sway a more favorable opinion.

The loyalties that are emerging between how different countries perceive China and the United States present an interesting backdrop for future developments. While some loyalties are ideologically motivated, others are dictated by investment and trade.

As China’s middle class continues to grow, and its collective voice amplifies, its human rights record will be more closely scrutinized. Only 28 percent of countries surveyed by Pew Research hold a majority view that China respects the personal freedoms of it people, compared to 95 percent who feel the same way about the United States.

"Another challenge for China’s image is that around the world the prevailing view is that China acts unilaterally in world affairs, pursuing its own interests and not taking into account the interests of other countries when making foreign policy decisions," according to Pew Research’s study.

That’s a global perception the United States has also confronted. What will be interesting moving forward, however, is whether China’s unilateral approach to foreign policy, disregard for personal freedoms, and aggressive investment in emerging economies will be viewed as altruistic or exploitative. That will tip the balance for countries that are currently hedging their fidelities.

WDFG Expands in Asia

Global businesses looking to tap Asia’s growing middle-class consumer base are rethinking how they align and orchestrate their supply chains with both sourcing and selling in mind. Take, for example, World Duty Free Group‘s (WDFG) recent decision to locate a logistics hub in Singapore.

The UK’s leading travel retailer submitted bids for various tenders at Singapore Changi Airport. But it is broadly seeking to build a retail presence throughout Asia. As part of the move, it has partnered with LF Logistics, a member of Hong Kong-based Li & Fung Group, which specializes in export sourcing, distribution, and retailing.

The main focus of the partnership agreement is to support business development in the region, according to WDFG. The retailer will also use the Singapore hub as part of its global supply chain network and to support sourcing for the company’s existing operations in Sri Lanka and India.

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