SUSTAINABILITY  /  TECH & INNOVATION

By FedEx | December 30, 2025

Asia Pacific’s logistics market is not only growing fast – it’s rapidly going green as well. Here’s how governments and businesses across the region are spearheading sustainable innovation in supply chains.

• APAC’s logistics industry is on track for robust growth, highlighting an urgent need to lower carbon emissions and move goods more sustainably.
• In line with ambitious net-zero targets, countries like Australia, China, Japan, Singapore, and South Korea are taking action to decarbonize logistics activities.
• FedEx has developed green logistics solutions to support businesses in the region, including electric vehicle adoption and sustainability insights.

Asia Pacific’s (APAC) dynamic logistics industry shapes the flow of goods around the world. Valued at over USD 4.6 trillion in 2024, the region makes up the largest share of the global logistics market. And it shows no sign of slowing: fueled by the region’s manufacturing boom and strong e-commerce demand, APAC’s logistics market will exceed USD 7.6 trillion by 2033.

This rapid growth underscores an urgent challenge: reducing the carbon footprint generated by shipping and storing goods. Logistics is a major contributor to climate change, accounting for up to 11% of the world’s greenhouse gas emissions. In APAC, transport emissions – including logistics – surged to an unprecedented 2.8 gigatons of CO₂ in 2024, rivaling the combined emissions of Europe and the US.

But the region isn’t simply standing still. Governments and businesses have been responding with decisive sustainability strategies, making APAC an emerging leader in green logistics innovation.

Leading the charge for green logistics

Led by ambitious net-zero targets, countries across APAC are rolling out initiatives to decarbonize supply chains.

Japan, Singapore, South Korea, Australia, and New Zealand have pledged to achieve net-zero greenhouse gas emissions by 2050, while China has recently committed to reducing CO₂ emissions by up to 10% by 2035. These nations are taking bold steps to drive cleaner, greener operations in logistics and beyond.

Here’s a look at some of their standout efforts:

China

Drone logistics is taking flight in China, driven by government policies and consumer demand for convenience. The 2024 Government Work Report spotlighted the low-altitude economy as a key growth engine for sectors like logistics, setting out policies to spur its development.

Drone-assisted logistics isn’t just faster – it runs on electric power and consumes less energy than conventional delivery trucks or vans. Studies show that drone-assisted truck delivery can reduce carbon emissions by about 24.9%, decrease total cost by 22%, and shorten delivery times by 20%.

Guided by national policies, local authorities and businesses are stepping up to innovate. For instance, Guangzhou is aiming to create a drone-based low-altitude logistics network across the city. Meanwhile, Anhui province is making history with its first regular drone cargo route, delivering blueberries from Huaining County’s blueberry-growing region to the provincial capital of Hefei.

Aerial innovation aside, China is also pushing for sustainability in packaging innovation. The country’s e-commerce boom has created an upswing in shipment volumes – and with it, a surge in plastic packaging waste.

But the government’s Five-Year Plan to curb plastic pollution is proving effective: courier companies have switched from non-biodegradable packaging to reusable bags, achieving a utilization rate of over 90%. And this momentum is set to continue. New regulations around eco-friendly packaging came into force in June 2025, encouraging companies to optimize packaging design and minimize waste.

Singapore

Singapore’s transport and logistics sectors are significant contributors to national greenhouse gas emissions, making decarbonization a top priority. In response, the Singapore government is providing training, support, and education to help logistics companies build sustainability capabilities and reduce their carbon footprint.

In 2024, EnterpriseSG and the Singapore Logistics Association launched the Sustainability Playbook for Logistics Enterprises – a step-by-step guide for logistics providers to plan their sustainability strategy. The playbook includes useful resources like toolkits, training courses, financing support, and sustainability standards.

Another notable initiative is the Logistics Sustainability Professionals Program, which trains workers in logistics-specific sustainability practices. By 2027, the program aims to have cultivated 500 sustainability officers for the logistics industry.

As workers upskill for a greener future, vehicles are getting an upgrade too. Singapore is at the forefront of clean mobility solutions, such as electric vehicles (EVs). The nation is building a network of 60,000 EV charging points and rolling out cash incentives for zero-emission commercial vehicles, which will accelerate the adoption of EVs in logistics.

Beyond electric vehicles, Singapore is exploring the green possibilities of autonomous vehicles (AVs). In October 2025, supermarket chain FairPrice Group received approval to transport goods on public roads using remotely supervised AVs – a first for the country. This AV usage is expected to lower carbon emissions by 27 tons per year while reducing manual labor for workers.

Japan

Inefficient operations have long been an issue in Japan’s logistics industry. The country’s manufacturing, distribution, and sales businesses operate independently, resulting in a fragmented delivery journey.

Currently in Japan, truck loading efficiency averages less than 40%. This means that 60% of vehicle space isn’t effectively utilized – requiring more trips to transport goods and increasing fuel consumption.

Japan’s government has taken the lead to tackle this inefficiency with the “physical internet.” Inspired by the way data is sent efficiently on the internet, this visionary concept helps to streamline how goods can be shipped.

On the digital internet, routers connect different networks, enabling data to flow freely through the most efficient path to reach its destination. Similarly, the physical internet encourages competing logistics companies to connect and share resources, so that vehicles can be loaded to their full capacity and use the most efficient route to deliver shipments.

The government’s Physical Internet Roadmap sets out concrete steps to make such collaboration possible. Key initiatives include using IoT and AI to share information on goods and transportation assets, as well as standardizing logistics materials like pallets and containers. The result will be more efficient and sustainable supply chains.

Australia

Sustainable Aviation Fuel (SAF) can be a game-changer for greener air freight. Made from sustainable feedstock like used cooking oil and agricultural waste, SAF has the potential to reduce CO₂ emissions by up to 80% as compared to fossil jet fuels. With abundant feedstock and strong government support, Australia is emerging as an APAC leader in SAF production.

Launched in 2024, Project Ulysses, a North Queensland Sustainable Aviation Fuel (SAF) project, is set to develop a facility that produces 102 million liters of SAF annually. By converting agricultural byproducts into alternative jet fuel, the facility could reduce net domestic aviation carbon emissions by 70% and displace up to 225,000 tons of CO₂ annually.

Australia is also home to the world’s first SAF blending terminal co-located with an airport. SAF can be blended with conventional jet fuel, but most blending happens at large-scale centralized sites. This makes it difficult for airlines to get SAF when and where they need it, and in the blending percentages that suit their operations.

The terminal in Queensland’s Toowoomba Wellcamp Airport answers these challenges, enabling airlines to blend SAF more flexibly and efficiently on-site. As global demand for SAF grows, this strategy could pave the way forward for aviation decarbonization.

South Korea

Korea’s automotive brands like Hyundai and Kia have made waves around the world, and the country is emerging as a major force in the EV market as well. 

Driven by domestic manufacturers, Korea’s annual EV supply hit a record 200,000 units in November 2025, including 26,000 electric trucks and 2,400 electric buses and vans. EV sales are expected to account for 20% of total vehicle sales in 2025, reflecting a strong shift toward sustainability in the logistics and transport sectors. 

Government funding is also supporting the push toward electric vehicles in logistics. In 2024, Korea’s government offered subsidies of KRW 140 billion for the adoption of light- and medium-duty commercial vehicles, and KRW 630 billion for heavy-duty commercial vehicles.

In turn, logistics providers are adopting more EVs as well. At FedEx, we recently expanded our EV fleet in Seoul with an additional 13 Hyundai ST1 electric cargo vans. Each EV will help us reduce tailpipe emissions by an estimated 4.5 metric tons per year as compared to diesel-powered vans.

Accelerating green logistics in APAC

Greening the logistics industry is a complex task, but it’s clear that APAC is meeting the challenge head-on. Countries across the region are blazing new paths toward more sustainable supply chains. 

FedEx is committed to supporting this shared journey by providing solutions that help businesses move goods responsibly – from our shipping emissions tracking tool, FedEx Sustainability Insights, to the electrification of our vehicle fleet – as we work toward our goal of carbon-neutral operations by 2040. 

There’s no doubt about it: green logistics is gaining momentum, and it’s opening the door to a future where moving goods and preserving the planet go hand in hand.

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Learn more about our progress toward green logistics here.