1 The World Bank’s Logistics Performance Index (LPI) and drivers of logistics performance Lauri Ojala, University of Turku, Finland Dilay Çelebi, International Transport Forum Roundtable on Logistics Development Strategies and their Performance Measurement 9-10 March 2015, Queretaro MEXICO
2 Geographical location of Turkey
450 Billion USD 400 350 300 250 Index value 200 150 100 50 0 Turkey's Foreign Trade World Trade Index
4 Logistics Performance Index Customs Infrastructure Ease of arranging shipments Quality Timeliness Tracking of logistics services and tracing ”Connecting to Compete, Trade Logistics in the Global Economy” World Bank (2014)
Turkey’s logistics performance Customs Infrastructure Ease of arranging shipments 3.23 3.62 3.38 3.00 3.16 3.53 3.15 3.18 2.94 3.07 3.08 2.82 2007 2010 2012 2014 2007 2010 2012 2014 2007 2010 2012 2014 Timeliness Quality of logistics Tracking and tracing services 3.87 3.77 3.94 3.68 3.64 3.54 3.52 3.27 3.29 3.38 3.23 3.09 2007 2010 2012 2014 2007 2010 2012 2014 2007 2010 2012 2014
For every For every 10% 10% increase in the LPI of a typical importer, increase in the LPI of a typical exporter, bilateral imports increase by bilateral exports increase by more than 54% 69% . .
Trade impact of logistics performance The LPI Score of selected regions Europe & Central Asia Turkey Malaysia High income: OECD Germany
10 Trade impact of logistics performance The LPI Score of selected countries IMP +14% Europe & Central Asia EXP +18% Turkey Malaysia High income: OECD Germany ITF Secretariat based on LPI and Korinek & Soudin (2011), To What Extent Are High-Quality Logistics Services Trade Facilitating?, OECD.
11 Trade impact of logistics performance Logistics competence IMP +52% EXP +154% Europe & Central Asia Turkey Malaysia High income: OECD Germany 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 ITF Secretariat based on LPI and Korinek & Soudin (2011), To What Extent Are High-Quality Logistics Services Trade Facilitating?, OECD.
Policy Actions Infrastructure Timeliness Tracking Ease Quality Customs of logistics and tracing of arranging services shipments Indicators Qualitative Quantitative
The efficiency of customs and border management clearance 3.23 3.16 3.00 2.82 2007 2010 2012 2014
Reduced variability of clearance times 40 20 hours 0 2008 2009 2010 2011 2012 2013 -20
Reduced variability of clearance times 40 20 hours 0 2008 2009 2010 2011 2012 2013 -20
Improvement of border facilities 38% decrease in export 100% time variability from 2010 to 2012 of customs transactions have been computerized. More than $200,000,000 is invested for modernization of border gates under BOT model .
The quality of trade and transport infrastructure 3.62 3.53 2.94 3.08 2007 2010 2012 2014
Construction of new transport links The percentage of road investment in GDP has almost doubled in the last 5 years, reaching up to 5.9 billion Euros in 2011 Road Investment as %GDP 1.19 1.2 1.03 0.88 0.85 0.8 0.72 0.52 0.4 0 2007 2008 2009 2010 2011 2012
Supporting dominant modes of transport International Trade by Mode of Transport Other 10% Air 11% Sea 55% Road 23% Rail 1%
Promoting low cost transportation modes More than diesel fuel accounts for over 90% 60% of semi-trailers of total freight costs are not craneable and cannot be loaded onto standard intermodal trains.
Drivers of Logistics Performance: Case Study Ease of Arranging Competitively Priced Shipments 5.0 0 4 10 17 4.5 26 22 20 3.74 4.0 3.45 3.54 3.64 3.50 3.18 3.32 3.31 3.5 40 37 36 3.0 2.57 48 2.5 60 2.0 80 1.5 1.0 100 113 0.5 0.0 120 DEU USA ITA MYS CHN TUR ROM BGR AZE Score Rank
Quality of logistics services 3.64 3.52 3.29 3.23 2007 2010 2012 2014
Supporting logistics industry and private sector Competence and Quality of Services Consignees or shippers Trade and transport associations Quality/standards inspection agencies Customs agencies Freight forwarders Turkey Average Europe & Malaysia Germany UMI Central Asia
Drivers of Logistics Performance: Case Study Findings Ability to Track and Trace Consignments 1 2 5.00 0 14 19 23 4.50 4.17 4.14 29 20 34 3.84 4.00 3.77 3.58 3.50 40 3.39 3.50 60 2.88 3.00 2.50 80 76 2.14 2.00 100 1.50 120 1.00 140 0.50 148 0.00 160 DEU USA ITA MYS CHN TUR ROM BGR AZE Score Rank
Promoting utilization of ICT in Logistics Services In the last couple of years, Turkey has experienced… Increased utilization of computerized border clearance systems. Introduced e-government services and e-signatures to facilitate… Improved telecommunications services to support logistics Encouraged development of CIT service providers to support the… Promoted companies for utilization of state of the art tracking and… Developed public information platforms for sharing trade and… Strongly disagree Strongly agree
Timeliness of Ease of shipments in arranging reaching shipments destination 3.87 3.38 3.94 3.68 3.18 3.15 3.38 3.07 2007 2010 2012 2014 2007 2010 2012 2014
Reducing transport network system vulnerability World Bank sources indicate that a one-day delay in delivery Trucks tend to In 2012, times causes a have long waiting 90 1% times at major Ro-La lines, even up to % 4-6 decrease in the volume of trade days of the trucks on Slovenia-Italy Ro-La lines had Turkish plate
Findings • Variability is one of the main factors of efficiency of the customs and border clearance. • Capacity management is vital for infrastructure efficiency. • A superior transport infrastructure supports vital transport systems, including access roads to terminals and seaports, and intermodal services. • A thriving private sector is one of the leading factors in providing high quality logistics services.
35 Lauri Ojala Turku School of Economics, Finland Rehtorinpellonkatu 3 FIN-20500 TURKU Email: Lauri.ojala@utu.fi Dilay Çelebi İstanbul Technical University Faculty of Management 34367 Maçka, Turkey Email: celebid@itu.edu.tr Roundtable on Logistics Development Strategies and their Performance Measurement 9-10 March 2015, Queretaro MEXICO
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