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Connecting Landlocked Developing Countries to Markets
activity, and this needs to be coordinated with the maritime transport. All these coordination tasks require the services of intermediaries. Where coordination is lacking, the result can be long queues of trucks waiting to deliver their freight to the port, waiting to pick up loads from the port, or simply trying to pass through a land border crossing. When rail or waterway transport is also involved, the intermediaries have additional coordination roles in connecting the rail and waterway transport with the road services needed to collect or deliver the freight to and from its land origin and destination. In many countries, customs brokers have a special and formal role in the verification of import and export documents prior to their presentation to the customs agency. Many countries require that such documents be presented to the customs agency only after they have been authorized by a recognized customs broker. The role of customs brokers in LLDCs is little different than it is in coastal countries, but dealing with transit freight in a coastal country does require different treatment of freight that is imported and exported to the coastal country. Transit freight is not subject to the payment of customs duties and import and export taxes and is not usually subject to the same inspections as imported and exported freight. For these reasons, customs brokers dealing with transit freight need to ensure that it is not subjected to the more rigorous customs and other agency treatment (such as agricultural and health inspections).10 While transport companies provide direct services, between them these intermediate operators coordinate the contracting of transport services for each stage of a freight journey from its origin to destination and, in doing so, need to make sure that all the regulations and documentation required for the transported products to enter or leave the country are complied with and completed. The differences between these professions correspond to different degrees of integration of services. The freight forwarder integrates the clearance business of the brokers with transport services. Third-party logistics providers (usually referred to as 3PLs), take charge of logistics activities that are otherwise internalized within the trading company.11 In developing countries, brokerage and freight forwarding are traditional activities, while third-party logistics in many of them is still a niche service industry.
Freight Forwarders The growing focus on source-to-destination supply chains puts a premium on good freight forwarding services. Because reliable on-time delivery is highly valued, shippers are increasingly willing to pay specialist