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Issue 1 2015 - Freight Business Journal


Nations sign ‘ground-breaking’ deal on simpler trade


Countries that failed to embrace easier


trade in future could


find themselves increasingly marginalised – but those that did would reap the economic rewards, says a senior director at global forwarder Agility. President and CEO of Agility


Global Integrated Logistics, Essa Al-Saleh described a World Trade Organisation (WTO) deal on trade facilitation signed towards the end of last year as “a very important step forward.” However, it would only benefit those countries that were willing to dismantle impediments


to trade such as


lengthy customs procedures or unnecessary red tape, he told a press conference to launch the latest edition of Agility’s Emerging Markets Logistics Index on 19 January. The WTO signed what


its director-general Roberto Azevedo described as a ground- breaking deal on trade facilitation in Geneva on 27 November. The 160 WTO members agreed


to introduce new standards for customs checks and other border procedures, adding over $1 trillion to the value of world trade, according to some estimates. Tarek Sultan, CEO of global


forwarder Agility and widely recognised as being a major player in developing world markets commented that the WTO agreement “offers real hope for small businesses, farmers, job seekers and others in rich and poor countries alike.” He added that: “Though there’s


no magic in the WTO package,” the measures included would eliminate paperwork, make rules more transparent, fast-track some low-risk shipments, and create ‘single windows’ for importers and exporters to pay fees and submit documents. John Manners Bell, CEO


of the Transport Intelligence consultancy and author of Agility’s index echoed this, saying that, without a multilateral approach to trade, countries would


increasingly organise themselves in trading blocs. Countries that found it harder to do this, such as sub-Saharan Africa, would find themselves increasingly marginalised as traders looked to easier opportunities in North America, Asia or Europe. He added that


trade deals


brokered by the WTO and its predecessors have brought “huge benefits”. Every percentage cut from logistics costs boosted the global economy by billions of dollars, he argued, adding: “Everybody should be rooting for this.” Now the WTO members need to ratify the pact -


two thirds


must do so for the agreement to come into force. The deal on trade facilitation was part of a wider agreement reached in Bali in December 2013. However, it has its roots in the Doha Round of trade talks started in 2001, which set an ambitious target of a full multinational trade deal between all the WTO members


but which rapidly became bogged down. This in turn prompted more recent negotiations on less


wide-ranging trade deals


such as those between the EU and individual south-east Asian countries or the Transatlantic Trade and Investment (TTIP) talks, leading many to believe that the WTO’s wide-ranging approach to trade facilitation was effectively dead. But the deal reached on 27 November meant that the


multilateral approach was back on track, Azevedo claimed. The WTO package could cut


the cost of trade by up to 15%, boost the global flow of goods, accelerate economic growth and add up to 20 million new jobs, most of them in developing nations. By salvaging the agreement, the WTO gets much- needed credibility and restores viability to the multi-lateral trade negotiation process. However,


///NEWS


the WTO’s member countries should not rest on their laurels. “The global economy can’t wait another 20 years,” Azevedo said. At a press conference on 19


January, president and CEO of Agility Global Integrated Logistics, Essa Al-Saleh described the deal as “a very important step forward.” Experience in Europe, the US and elsewhere shows that “trade follows the line of least resistance.”


New countries join the simpler-trade set


The sixth edition of Agility’s annual Emerging Markets Logistics Index, published on 19 January,


found


plenty of examples of dynamic emerging countries that were moving up the global ease-of- doing-business and economic growth rankings. They include many, such as Nigeria, Bangladesh


and Pakistan that have not so far figured in the lists of promising countries, beloved by economic pundits, such as the ‘BRIC’ (Brazil, Russia, India and China). Indeed, growth has been


relatively slow in China lately, while Brazil has slipped down the ranking somewhat, mainly


because of problems with infrastructure and bureaucracy. At the same time, some of the


countries that figured in another economists’ list, the so-called ‘Fragile Five’ (Brazil again, India, Indonesia, South Africa and Turkey) had done rather better than expected.


Inland costs stymie Africa


Shipping a 40’ container from Shanghai to Mombasa costs less than US $1,000, but moving the same container 1,240 miles from Mombasa to Bujumbura, in Burundi, costs $7,000. And while the sea voyage from China to Kenya takes 28 days, the road journey from Kenya’s primary port into land-locked Burundi requires 40 days.


These were the African Development Bank


figures APM Terminals’ commercial director for inland services West Africa, Moussa Diop, in describing the opportunities represented by a rapidly expanding and urbanizing sub-Saharan population to the at the TOC West Africa Market Briefing conference, on 10 December.


Aid on its way thanks to Logwin


An aid shipment of beds, X-ray image viewers and other goods donated by the Hochtaunus Hospital Centre in Bad Homburg is


currently en route to


Tanzania, thanks to freight forwarder Logwin. The ship is due to reach Mombasa in February. A partner company will assume responsibility for onward transport. The Mwanga Health Centre


serves 20,000 people in the Kilimanjaro region in the north of Tanzania. Some 40 staff provide medical care for patients, ranging from AIDS


Forwarders add Africa bases Panalpina has opened new bases in Morocco and Kenya to take advantage of growing opportunities, particularly in the energy and infrastructure sectors. Morocco has emerged in recent years as a leader


in the region’s wind power generation. Investment in solar power technology, such as the Noor-Ouarzazate Solar Complex, is helping reduce its dependence on fossil fuels. The discovery of major oil resources in northern


Kenya has brought leading oil companies into the region and Panalpina holds service agreements with many of them. Agility has started building 40-acre distribution


park in the Tema Port Free Trade Zone Enclave in Accra, Ghana. The Agility Distribution Park, one of a series of logistics hubs that the forwarder is building across the African continent, will provide international standard logistics infrastructure to local, regional and global companies operating in Ghana.


awareness and prevention education to primary medical assistance for serious traffic accidents.


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