Logistics observatories: international
experiences
Jari Kauppila, Senior Economist
ITF Statistics meeting, 1-2 April 2015

2International Transport Forum at the OECD

► An inter-governmental organisation with 54 member
countries focussing on transport► A strategic think tank for global transport policy issues► An annual summit of Ministers

3Why focus on logistics
performance

4

All components oftrade logistics impact
trade more significantly,
by several magnitudes,
than do distance orfreight costs
To What Extent Are High-Quality Logistics Services TradeFacilitating?(OECD, 2011 )

51% cost reduction in logistics
could increase world income by

USD 40 billion
Overcoming Border Bottlenecks, The Costs and Benefits ofTrade Facilitation, OECD (2009)

6Eliminating supply chain barriers: Improving borderadministration and transport infrastructure halfway toworld’s best performers would alone lead to+5%increase in global GDP

6 times morethan a complete worldwide tariff elimination
Enabling Trade: Valuing Growth Opportunities, World
Economic Forum (2013)

0Europe (2008)

Switzerland (2009)

Europe (2007)

Netherlands (2008)

United States (2008)

United States (2010)

Japan (2007)

OECD (2004)

USA (2004)Sweden (2005)

Finland (2009)

Korea (2007)

South-Africa (2010)

Baltic region (2006)

Norway (2007)

China (2009)

Chile (2004)

China (2007)

Thailand (2008)

Mexico (2004)

Morocco (2005)

Colombia (2004)

Brazil (2004)

Argentina (2004)

7Logistics costs as a percentage of GDP
30

25

20

15

10

5

Rantasila & Ojala (2012), Measurement of National-level
Logistics Costs and Performance, ITF Discussion Paper 2012-04.

8Logistics Performance Index

Customs

Qualityof logistics services

Infrastructure

Ease of arranging
shipments

Timeliness

Trackingand tracing”Connecting to Compete, Trade Logistics in theGlobal Economy” World Bank (2014)

9

Chile’s logistics performance
Customs

Infrastructure
3.18

3.3
3.2

Ease of arranging
shipments
3.17

3.2

3.06

3.1
2.86

2.9

2007

2010

2012

2014

2007

2010

Quality of logistics
services

2.7

2012

2014

2007

2010

Tracking andtracing
3.3

2012

2014

Timeliness

3.3

3.2

3.2

3.1

3.1

3.8

3.2
3.0

3.6

3.5

3.2

3.5

2.9

2007

2010

2012

2014

2007

2010

2012

2014

2007

2010

2012

2014

10

Trade impact of logistics performance

LPI score of selected
regions
Latin America & Caribbean
ChileHigh income: OECD
Germany012

3

4

5

ITF Secretariat based on LPI and Korinek & Soudin (2011),
To What Extent Are High-Quality Logistics Services Trade
Facilitating?, OECD.

11Trade impact of logistics performance+40% to 50%
LPI score of selected
regions
Latin America & Caribbean
Chile

High income: OECD
Germany
012345

ITF Secretariat based on LPI and Korinek & Soudin (2011),
To What Extent Are High-Quality Logistics Services Trade
Facilitating?, OECD.

12Trade impact of logistics performance+140% to 180%
LPI score of selected
regions
Latin America & Caribbean
Chile

High income: OECD
Germany
012345

ITF Secretariat based on LPI and Korinek & Soudin (2011),
To What Extent Are High-Quality Logistics Services Trade
Facilitating?, OECD.

13

Need to understand better how policies affect thelogistics performance under different trade andtransport facilitation components
Policy Actions

Customs

Infrastructure

Easeof arranging
shipments

Qualityof logistics
services

Indicators
Qualitative

Quantitative

Timeliness

Trackingand tracing

14

Logistics an elevated priority
 Several countries acknowledge importance ofimplementing a national logistics strategy
 Need objective, fact-based, metrics to: Provide reliable benchmarks;
 Monitor and compare global advances in logistics;
 Assess impact of policies; Improve country’s logistical competitiveness; Attract foreign direct investment, etc.

15Logistics observatories

16

A word of caution
 A wide range of types of observatories
 Definition of logistics itself is vague
 Institutional arrangements vary depending oncomposition, mandate, size, etc.
 This is a stylised description – not detailed review

 Difficult to access information – mainly secondary
sources used and expert interviews
 Limited information on performance of logistics
observatories

17

A growing number of “logisticsobservatories”
 International benchmarkingInternational Transport Forum at the OECD (logistics costs, freight performanceindicators, Transport Outlook), World Bank (Logistics Performance Index, DoingBusiness, Eurostat (transport statistics), IDB (Regional freight observatory, Customs
performance indicators, etc.), World Economic Forum (Global competitiveness
report), UNCTAD, ICAO, UIC, IMO, IATA, etc. (mode specific indicators and statistics)

 National research centres, observatories, otherinitiatives
Canada, Netherlands, Germany, Spain, France, Finland, Norway, United States,Panama, Colombia, Mexico, Argentina, Paraguay, Uruguay, Thailand, Indonesia, SouthAfrica, Singapore, Malaysia, Indonesia, several in South East Asia, etc.

 Other data collection

National statistical offices, corridor/regional level logistics studies, etc.

18

Wide range of functions
 Diagnostic and monitoring logistics performance Building reliable indicators and packaging them todrive policy-making
 Knowledge dissemination/platform for best practices
 Supporting training and education in logistics
 Strategic policy advice / evidence base forgovernment decision-making
 Raising profile of logistics and the country19

Wide range of activities Information pooling (repository for information); Information synthesis (overviews and synthesis interms of periodic reports;)
 Flagship publications
 Research (from filling data gaps to setting researchagenda for logistics);

 Workshops, public events, training; Advice to specific policy questions, etc.

20

Several business models
 One-shot or specific financed activities still common
 Knowledge still developed in isolation – no network
between observatories
 No definitive business model for observatories yet
 Public-private partnerships are being explored more
 Not so dependent on government funding alone Sense of ownership is critical

21

Many have failed
 Sustainability a key challenge Initial interest fades away and the purpose of the exercise
is forgotten Objective is not crystalised Indicators are too complex and not linked to realpolicies or business needs
 Lack of strategies for funding Lack of institutionalisation/sense of ownership

22

Success factors
 A clear objective/purpose (why are we doing this); A clear policy connection (what are we doing,indicators linked to actionable policies);
 Measurable targets (success breeds success); Strong commitment both from public and privateside (ownership of the exercise); Regular feedback on indicators and their usefulness(with periodical reviews of them); and Sustainability (need a well defined business plan);23

Data areas to support decision-making
 Thorough exercise with stakeholders and experts toidentify key data areas
 Modal split
 Market diversity (characterisation of sector)
 Logistics activity and expenditure (volumes, prices, costs)
 Resource utilisation/productivity (labor, fuel use)
 Service quality (KPIs, transit time, reliability) Sustainability (environmental and social costs and benefits)Thank you
Jari Kauppila
T +33 (0)1 45 24 97 21
E jari.kauppila@oecd.org
Postal address
2 rue Andre Pascal
75775 Paris Cedex 16