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logistics

Preparing for the future of logistics - the Singapore way

Yin Yin Lam's picture
Photo: Sarah Starkweather/Flickr
The government of Singapore recently outlined its vision for the country's future, describing how different sectors could harness technology, innovation and mega-trends in order to take the city-state to the next level. This approach includes a dedicated Industry Transformation Map for the logistics sector, which accounts for 7.7% of Singapore's GDP and over 8% of jobs. Logistics is also understood as a crucial enabler for other significant parts of the economy, such as manufacturing and trade.

How is Singapore anticipating the transformation of logistics?

Singapore has been considered a major logistics hub for quite some time, and is currently ranked first in Asia according to the Word Bank’s Logistics Performance Index. The sector, however, is experiencing significant transformations such as the rise of digitally enabled logistics services, and the emergence of new delivery capabilities (autonomous vehicles, 3D printing).

The Industry Transformation Map (ITM) will help Singaporean logistics keep its competitive edge in this rapidly evolving context, and aims to achieve a value-added of S$8.3billion (US$6 billion) by 2020. In particular, the ITM intends to strengthen innovation, productivity, as well as talent development across the logistics sector—including by leveraging trends such as artificial intelligence and collaborative robotics.

Three factors that have made Singapore a global logistics hub

Yin Yin Lam's picture
Then vs. now: the Port of Singapore circa 1900 (left) and today (right). Photos: KITLV/Peter Garnhum

When it gained independence in 1965, Singapore was a low-income country with limited natural resources that lacked basic infrastructure, investment and jobs.

A few decades later, the picture couldn’t be more different. Singapore has become one of Asia’s wealthiest nations, due in large part to its emergence as the highest-performing logistics hub in the region (see World Bank Logistics Performance Index).

The numbers speak for themselves. Today, the small city-state is home to the world’s largest transshipment container port, linked to over 600 ports worldwide. Singapore Changi airport is voted the best internationally, and is served by about 6,800 weekly flights to 330 cities. Finally, the island nation’s trade value amounts to 3.5 times its GDP.

Singapore’s achievements did not happen by chance. They result from a combination of forward-looking public policy and extensive private sector engagement. This experience could provide some lessons to any developing country seeking to improve its logistics network. Let us look at three key factors of success.

What are some critical innovations for improving port-hinterland connectivity?

Bernard Aritua's picture
Photo credit: Hxdyl/Shutterstock
Imagine landing in the wee hours of the morning into Netaji Subhas Chandra Bose International Airport in Kolkata, India. As you leave the airport in a taxi, you find yourself stuck in heavy traffic and this at 4:00am in the morning! It does not take long to realize that you are sharing the roads with other early rising passengers riding in cars and buses, but also with a long queue of freight trucks, which seem to be the majority of vehicles along the road. Why are so many freight trucks winding through the city center? You soon learn from the taxi driver that some of the trucks are heading to, or coming from the famous ‘Barabazar’ market, but others are heading towards Kolkata port.

As your taxi leaves the line of trucks behind, you realize that you could be in any port-city in India or, for that matter, in China, USA or Europe. The types and number of trucks, and the freight carried may vary, but the challenges of port-generated traffic affecting the city hinterland is common. Of course, urban mobility solutions are multi-dimensional and usually include complementary strategies, investments and actors. However, the root cause of port-generated city traffic is simply a product of conventional port planning.

In Kolkata, the problem of port-generated traffic could get worse with the completion of the Eastern Dedicated Freight Corridor and National Waterway 1 (Jal Marg Vikas project). However, thanks to an innovative port-hinterland connectivity solution, supported by the World Bank, the ports of Kolkata and Haldia will dramatically increase their capacity while solving the issue of port-generated traffic. This is great news for the many truck drivers, who can often take a whole night just to get in queue to enter the port.

Media (R)evolutions: E-Commerce Will Rise in Emerging Markets

Roxanne Bauer's picture
New developments and curiosities from a changing global media landscape: People, Spaces, Deliberation brings trends and events to your attention that illustrate that tomorrow's media environment will look very different from today's and will have little resemblance to yesterday's.

E-commerce is a technology ‘megatrend’ that is expected to become more popular in the future. As it achieves higher penetration rates in developing countries, it will overcome obstacles to adoption like the need for high-speed data networks that are fast enough for smartphones and inventory and shipping costs. These obstacles are only overcome with better infrastructure and greater scale. As its popularity grows, the retail sector, online businesses, logistics and supply chains and other connected industries will need to adjust.

As the table below demonstrates, a larger share of the online population in many countries will be purchasing goods online in 2018 than now. Around 50% of the online population in emerging markets will shop online by 2018, not far from the average penetration of 63% in developed countries.



To feed the future, let’s make logistics and transport sustainable

Jose Luis Irigoyen's picture
How serious are we about addressing the challenge of food security in the face of climate change?  This is one of the topics to be discussed at Food for the Future, one of the events at the IMF-World Bank Group Annual Meetings this year.

If we are dead serious about this challenge, then we really need to pay greater attention to the role of transportation and logistics, both crucial in increasing food security, so we can feed 9 billion people by 2050, and mitigating impact on climate change. Just consider these facts:

  • Up to 50% of harvest is wasted between farm and fork, the moment we actually consume food.
  • Transport-related emissions account for about 15% of overall greenhouse gas emissions. And 60% of those emissions are coming from road transport.
  • And logistics costs affect small farmers disproportionally (up to 23% of their total costs).
Thus logistics – the services, knowledge, and infrastructure that allow for the free movement of goods and people – is now recognized as a key element in achieving sustainable food security, and thus a driver of competitiveness and economic development. The development of agro-logistics, for example, has helped address the food security challenge more holistically: from “farm to fork” and all stages in between.

Logistics: a Critical Nexus Point for Inclusive Growth

Marc Juhel's picture
As I get ready to head back to Washington DC after a visit to The Netherlands, I don’t want to miss the opportunity to share with you some thoughts on sustainable logistics.

While some of you might be familiar with the term, transport logistics refers to the services, knowledge and infrastructure that allow for the free movement of goods and people. 

In today’s globalized economies, logistics is recognized as a key driver of competitiveness and economic development. And as policy making turns its attention to promoting sustainable growth paths, valuing scarce resources, and minimizing environmental impacts, sustainable logistics is indeed a key nexus point.

Efficient logistics systems are a precondition for regions, countries, cities and businesses to participate in the global economy, boost growth, and improve the living conditions of millions of people.

That’s why this topic is so important for the World Bank’s mission and our client countries in the transport sector. And that’s why this week in The Hague we organized, together with the government of The Netherlands and partners like Dinalog, the Dutch Institute for Advanced Logistics, our first Conference on Sustainable Logistics.

Growth in Greece? A Logistical Possibility

Daria Taglioni's picture

The Partnenon in Athesn, Greece. Source -  Nicholas Doumani.More than 95 percent of goods traded between Europe and Asia are transported via deep sea. All of this happens through two primary routes-- some serious traffic. But it's far from stop-and-go. In fact, most doesn’t stop at all.

Large container ships leave ports in Asia and proceed directly to Rotterdam, the Netherlands. Many choose to get there by passing through the Suez Canal, entering the Mediterranean, and bypassing its bygone empires.

One of these ancient powers, Greece, now finds itself in a marginal position on the logistical map of Europe. Despite being geographically and economically well located, it’s far from being the hub it once was. The World Bank’s International Trade Unit and the Transport Unit of the World Bank’s Vice Presidency for the Europe and Central Asia Region recently teamed up with the government of Greece to find out how the country can capture a share of the world’s growing East-West trade and kick-start an economy that has been struggling to maintain GDP growth after the global economic crisis.
 

What It Takes for Trade to Reduce Poverty in Africa

Otaviano Canuto's picture

Despite tremendous progress in poverty reduction over the last two decades, poverty still persists. Along with South Asia,  Africa is a region where large numbers of people continue to live in extreme poverty. It is also a region where there is clearly room for higher foreign trade levels (see Chart). Given that trade can generate growth – and thus poverty reduction – focus on trade-related reforms (e.g. lower tariffs, better logistics, and trade facilitation)  deserves to be a high priority of the region.

Trade: The World Is Not Flat Yet

Otaviano Canuto's picture

Thomas Friedman’s bestseller The World Is Flat highlights the strong forces pushing the world towards a single economic platform. The technology-fueled globalization in the provision of services, and the widespread organization of production processes as global value chains are part of his narrative.

Reliable Supply Chains: An Answer to Competitiveness and Growth Challenges

Monica Alina Mustra's picture

In today’s interconnected world economy, efficient, reliable and cost-effective supply chains have become necessities in global trade. Trading in a timely manner with minimal transaction costs allows a country to expand to overseas markets and improve its overall economic competitiveness. For many countries, however, identifying bottlenecks along a supply chain and then determining which logistics procedures and infrastructure to upgrade can be a challenging feat.


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