MARKET CONCENTRATIONIN THE AIR FREIGHTFORWARDING INDUSTRY
everywhere." Interview with SkyFreight, Manila, 23 August 2002 Local forwarders still have some advantages. They often have stronger relationships with rol ocal authorities, with the local staff who co airline space, and with others. In some coun- tries, regulations favour locally owned firms, though that favouritism has diminished and will continue to diminish under the WTO. Special ity markets offer continued promise to small and medium-sized local forwarders. Examples in Southeast Asia include the cut flower and live tropical fish markets. Some local forwarders nave attempted to overcome their limitations g their own a ances, akin to the gl balised production networks employed by small firms in other industries (e.g. see Ernst (2000) on small Taiwanese electronics manufacturers) compete with much larger adversaries. Finally ocal forwarders may prove more responding to fast-changing market needs and requirements; in particular, the development of the externalised logistics services described earlier saddle forwarders with large investments n fixed infrastructure that can undermine the flexibility of the industry's giants. Nevertheless, in this industry as in other pro- ducer service industries, changes in technology and the scale of production favour the largest firms. Geographically, that rise in market con centration will favour firms from core country markets but at the same time those core coun- try firms are likely to narrow the gap between the sophistication of air freight-related logistics services between advanced and developing es. In other words, the trend towards the increased dominance of producer services shrinking firms from advanced economies may be associated, some. what paradoxically, with the diminution of the geographic unevenness of the services those ndustries provide.