Page 90

70

The Cost of Being Landlocked

increase in the coming years. Because of the maritime transport price differential between Nouakchott, Mauritania, and Dakar, Senegal, exports are processed through the Dakar port. Despite border-crossing costs and a longer distance, the exporters gain from this shift. Maritime transport differentials may be very high: in West Africa, shipping lines charge US$1,650 for a 40-foot container from Northern Europe to Douala, but US$3,450 to Malabo, which is located only 100 kilometers from Douala. 4. Unlike the transit overheads, administrative costs stem from purely private transactions and happen irrespective of the landlocked status of destination or origin. However, they are potentially much higher in the context of small, distant economies and are therefore important in this analysis. 5. Because transit overheads are the most important transit expense in terms of delays and unpredictability, we focus on transit-related overheads in this chapter. However, terminal and handling charges, excluding port charges, may be considered as overheads. Compulsory warehousing is common in Africa, often linked to chamber of commerce–owned or shippers council–owned facilities. Likewise, compulsory change of vehicles—for example, from India to Bangladesh (Petrapole and Benapole)—though actually corresponding to a service, generates overhead linked to requirements of arranging the trans-shipment. 6. In fact, some success stories, such as the mango exports from Mali and Burkina, have been dependent on the capacity of international operators to integrate the various segments. 7. The U.S. Department of Transportation estimates them at 4 percent for U.S. trade. 8. In western Africa, the West African Economic and Monetary Union and the Economic Community of West African States have created ways to track those practices with World Bank Sub-Saharan Africa Transport Policy Program (SSATP) and U.S. AID assistance. 9. The breakdown in 2004 was as follows: US$300 for transit charges, US$75 for insurance, US$60 for sanitary control, US$10 for a visa, road user and escort fee charges, and an environmental tax. (Data provided by the Osh Chamber of Commerce, Kyrgyz Republic.) 10. Theoretically, Behrens et al. (2006) demonstrate that transport costs can act as a barrier to competition from abroad and that operators from landlocked regions may therefore have an interest in being protected from competition by high import costs.

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...