. /.  WORLD TRADE  
ORGANIZATION  TN/S/W/34 
18 February 2005 
 
 (05-0711) 
Council for Trade in Services 
Special Session Original:   English 
 
 
 
COMMUNICATION FROM  
AUSTRALIA, CANADA, CHILE, DJIBOUTI, THE EUROPEAN COMMUNITIES, HONG 
KONG CHINA, ICELAND, JAPAN, KOREA, LIECHTENSTEIN, MAURITIUS, NEW 
ZEALAND, NICARAGUA, NORWAY, PANAMA, PERU, SINGAPORE, SWITZERLAND, 
THE SEPARATE CUSTOMS TERRITORY OF TAIWAN, PENGHU, KINMEN AND 
MATSU, AND THE UNITED STATES 
 
Joint Statement on Liberalization of Logistics Services  
 
 
 The following communication, dated 17 Februa ry 2005, from the delegations of Australia, 
Canada, Chile, Djibouti, the European Communiti es, Hong Kong China, Iceland, Japan, Korea, 
Liechtenstein, Mauritius, New Zealand, Nicaragua , Norway, Panama, Peru, Singapore, Switzerland, 
the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu, and the United States is being 
circulated to the Members of th e Council for Trade in Services. 
_______________ 
 
 
1. International trade is facilitated by freight logistics services providing efficient integrated 
management of point-to-point supply and distributio n chains.  Logistics suppliers manage the supply 
chain process by planning, implementing, and cont rolling the efficient and effective point-to-point 
flow and storage of goods, services and related info rmation, throughout the production, distribution 
and delivery stages, from the initial suppliers of inputs to final consumer s of products. Logistics 
services form a crucial and integral part of the infrastructure and a major determining factor of the competitiveness of an economy in global trade and investment. 
2. Efficient freight logistics services are benefi cial to world trade in goods and services and 
crucial to the economic development of different ec onomies.  The availability of competitive logistics 
services, namely on a global basis, will enhance overall economic efficiency and competitiveness.  
This is particularly the case for developing countri es, which have significant interests in export of 
goods ranging from agricultural products to indus trial goods, and which could benefit from timely, 
reliable and efficient supply chain, distribution and inventory management for their exports.  Data 
shows that logistics costs are a particularly heav y burden for developing countries, especially small 
economies, island economies,  and landlocked economies
1. Differentials in logistics costs could be 
even higher than tariffs and could easily undermine comparative advantage in production costs.  Cost 
reductions or quality improvements in the supply chain benefit the exporter through increased 
                                                      
1According to the World Bank, total logistics cost s (including packaging,  storage, transport, 
inventories, administration and management) are estimated to reach up to 20 per cent of total production costs in developed countries, while freight costs alone can be up to 40 per cent of export values for certain landlocked 
developing countries. UNCTAD also estimated that freight  costs as a share of import value is higher for 
developing countries at 8.8 per cent (in 2002; Asia 8.3 per cent, Africa 12.4 per cent and Latin America 10.0 per cent) compared with 5.7 per cent for developed countries. Logistics costs also typically amount up to 12-17 per 
cent of the GDP of an economy (source: Council of Logistics Management).  TN/S/W/34 
Page 2  
 
 competitiveness as well as the importer/consumer th rough lower total prices to be paid. The 
availability of efficient freight logistics infrastruct ure and services is also an important factor in 
attracting inward investments in many sectors especially manufacturing. 
3. The trend of increasing focus on integrated ma nagement of the supply chain and outsourced 
support for transport and inventory management provides significant potential for third-party 
suppliers of logistics services to flourish.  Su ch third-party logistics services would enable 
manufacturers of goods and service providers (e.g. in relation to distribution) to pay specialists for 
providing freight logistics management and to focu s better on their core competencies to enhance 
their competitiveness. Competitive logistics services  could also benefit freight transport services 
suppliers through more efficient use of their capac ity reducing costs and improving profitability. The 
availability of integrated freight logistics service s on a global basis enhances the potential for further 
growth in global trade, and opens up new mark ets and possibilities for producers and exporters, 
especially those in developing countries. 
4. We, the co-sponsors of this statement, consider  improvements in freight logistics services to 
be a crucial underpinning of expansion of global tr ade and improvements in global economic welfare.  
Liberalization of the range of services involved in freight logistics operations on a global basis will 
benefit all Members by enhancing the effici ency and competitiveness of all economies and 
contributing to economic development of users of fr eight logistics services. We therefore urge all 
Members to participate actively in the negotiations with a view to achieving substantial liberalization 
commitments in logistics services. 
__________