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Delays and Unpredictability Matter More than Transport Costs for Development

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requirements that, besides slowing traffic, can lead to days of delay in transit, especially if convoys are not available daily or are slowed by defective vehicles. That initiation of transit takes more time than final clearance in virtually all corridors in developing countries is potentially the single biggest barrier in the current implementation of transit regimes.6 Transit initiation requires simplified documentation compared with final clearance. For most shipments, the process should not include inspection or intervention of non-customs agencies. Finally, the principal of transit is often a large freight forwarder, which can provide customs with appropriate guarantees. Unfortunately, • Most customs in transit countries consider transit operations to be minor traffic7 but a major source of risk because of tariff duties evasion. • The inefficiency of freight forwarders and shippers can slow transshipment (for example, the generalized practice of container destuffing in many African ports, shipments kept in port by freight forwarders until the shipper has paid for transport, grouping of small shipments). • Documentation is as cumbersome for transit as it is for domestic clearance, if not more so. • Risk management is absent (as is also the case for domestic goods): there is no incentive provided for compliant logistics operators.

The Observed Unpredictability of Lead Time Direct empirical evidence on the distribution curve of lead time over a full transit process is not obtained readily. Evidence is more easily available for partial transit processes such as border crossing and dwell time at container terminals in ports. In preparing for the east Africa trade and transport facilitation project, in 2005 the authors were able to collect extensive transit lead time data from a logistics operator in the northern corridor. These data include the breakdown of various phases in transit, but they do not include information on individual shipments. In the samples collected over the years, the authors have consistently found that the lead time probability distribution function is asymmetric, with a broad tail for the total transit time as well as for the port lead time, as shown in table 4.1. The broad tail can be the result of all the uncertainties surrounding both public and private actors of transit, and the shape of the probability distribution function will reflect the unpredictability of lead

The Cost of Being Landlocked  

This book proposes a new analytical framework to interpret and model the constraints faced by logistics chains in landlocked countries. The...

The Cost of Being Landlocked  

This book proposes a new analytical framework to interpret and model the constraints faced by logistics chains in landlocked countries. The...