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Press Release

The ASEAN cross-border road transport market was valued at USD 2023.22 million in 2018. Cross Border Transport Agreement (CBTA) is one of the crucial elements of the Greater Mekong Sub region (GMS) for the free movement of the goods throughout the region to support the economic cooperation. The ASEAN framework agreement on the facilitation of goods in transit (AFAFGIT) and the ASEAN framework agreement on the facilitation of inter-state transport (AFAFIST) are two other agreements that support the cross-border trade for the integration and economic cooperation in the region. The customs clearance is an essential process in freight transport across borders. The integrated logistics with customs clearance and value-added services, like storage and packaging are a crucial differentiator for the logistics companies. Thailand, located at the center of the region forms the heart of the region, and is the hub for the cross-border road transportation activities. More than 30 provinces of Thailand shares border with Myanmar, Laos, Malaysia, and Cambodia. As one of the largest and key exporters of the region, the country plays a crucial role in the supply chain, especially in the cross-border movement of goods.

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Scope of the Report

A complete background analysis of the ASEAN cross-border road transport market, which includes an assessment of the sector and contribution of sector in the economy, market overview, market size estimation for key segments, key countries and emerging trends in the market segments, market dynamics, and key freight statistics are covered in the report.

Key Market Trends

Increasing Population and Urbanization Demanding for More Flow of Goods and Services

The countries of Southeast Asia altogether are home to more than 640 million people and the region as a whole is the third most populous in the world, which is equal to almost 8.5% of the total world population. Among the total population, Indonesia, the Philippines, and Vietnam account for nearly 70% of the population. Moreover, the economy of the region as a whole is the seventh largest economy in the globe. This presence of high population along with the growing economies, rising disposable income, and increasing middle class population altogether are responsible for the growth of trade in the region. Rapid urbanization is expected to propel the demand for consumer goods and this growing demand presents the opportunity for the businesses to expand their activities in other countries through online channels thereby fostering the cross-border trade of goods. In addition, the rise in the incomes of the people in Southeast Asia shows positive effect on spending related to consumer goods, which leads to the increase in the flow of goods and services across the region.

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Myanmar is the Fastest Growing Market

As per the industry sources, Myanmar is the fastest growing market among all the countries in the ASEAN region during the forecast period. Myanmar is endowed with Asia’s most outstanding location. Geographically, Myanmar is the Asian economy that is most strategically positioned to benefit from the dual economic ascension of China and India, and with other ASEAN countries. Bilateral trade between India and Myanmar was topped by beans and pulses from Myanmar, and sugar and medicines from India. While China has pumped in massive amounts of money to build modern infrastructure at Ruili and Yunnan province, to boost connectivity with Myanmar, the infrastructure at the India-Myanmar border post, Moreh, is still inadequate. Myanmar delivers goods to Thailand through its sea routes and cross-border gates. Seven border trade camps opened between the two states, including Tachilek, Myawady, Kawthoung, Myeik, Htikhee, Mawtaung, and Maesai. Among all border trade camps, the Myawady gate witness the largest value of trade, followed by Myeik, Kawthoung, and Tachilek. The Yamato Group set up a joint venture in Myanmar, to specialize in Thai-Myanmar cross-border trade and small-cargo delivery for households and businesses. Yamato’s services offered in Myanmar included import/ export-forwarding and cross-border truck transport from other Asian countries.

Competitive Landscape

Being able to offer cross border transport and logistics services as the same entity or entities as part of the same group is a capacity very few players have in the market. Like all other value-added segments – there is market consolidation present in the ASEAN cross border road transport market. As per research carried out and insights from research papers, commentary by Japanese trade promotion industries and industry stakeholders surveyed – global players such as DHL, DB Schenker Group, CEVA Logistics, Kerry Logistics/KART, Nippon Express, etc. are the leaders in the market, taking up almost 60-70 % of the market share. The next segment belongs to local companies that have multi-country presence, such as OTL, Tiong Nam and other Thai players. Presence of key Chinese players concerning the Myanmar, Laos and Vietnam market is expected to increase as trade and the total transport market grows, while such players and the Japanese logistics companies serving specific key customers are among the companies that as a cluster have a lower relative share of the market, keeping aside big international players and top local players.

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This post was originally published on Info Street Wire


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