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International Freight Transport, Logistics Systems and Transport Facilitation

Madan B. Regmi, DEng. Transport Division UNESCAP, Bangkok

National Stakeholders Consultation and Capacity Building Workshop on Sustainable and Inclusive Transport

9-10 April 2015 Thimphu, Bhutan

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The Vision for Asia and the Pacific

Development of an international integrated intermodal transport and logistics system

o  Transport Links n  Integration of road (AH), rail (TAR), inland

waterways, shipping and port networks o  Transport Nodes

n  Intermodal nodes/interfaces (ICDs, Dry ports, Airports, Ports, River Ports)

o  Transport Services n  Private/public sector

o  Integration of transport modes n  Development of logistics centres and dry ports n  Facilitate and promote modal shift

Focus on plugging infrastructural, operational, institutional and technical gaps

Freight mode share

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Road transport share of freight:

•  79% Europe •  85-90% in Asia

Sustainable Freight Transport Promotion of Intermodal Transport and Integration

o  Optimal use of road, rail, maritime transport, logistics centres and dry ports

o  Integration of different modes o  Rail based intermodal transport can relieve road

congestion o  Potential emissions reduction

n  Consolidation – reduce less than truck loads runs and reduce number of trucks

n  Improved logistics can reduce 10-20% emissions (OECD, 2010) n  Consolidation and distribution centres in UK have combined 25.7%

emissions reduction (Zanni and Bristow, 2009). n  Replacement of trucks by freight train from port to dry port in

Sweden led to 25% CO2 emission reduction (Roso, 2007). n  43% of freight modal shift to railways, 30% less CO2 emission

(Laos-Thailand corridor) o  Regional economic development: industrial centres, free

trade areas

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Logistics Performance Index, 2014 1.  Customs, 2. Infrastructure, 3. International shipments, 4. Logistics competence, 5. Tracking and tracing, 6. Timeliness

(World Bank, 2014)

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

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Intermodal transport corridors o  Corridor based approach

n  Infrastructure n  Facilitation n  Operation

o  Review of condition of infrastructure, process and procedures and analysis of operation time, costs

o  Need to measure and continuously work to improve efficiency

o  Improvement and upgrading of infrastructure is an ongoing process- need resources and time

o  Improving operations and facilitation measures needs COMMITMENTS

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Assessment of Incheon-Ulaanbaatar Corridor

(Data from private sector and Govt. Dec 2010)

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Intermodal  transport-­‐  case  of  Birgunj  ICD,  Nepal  

0  

50000  

100000  

150000  

200000  

250000  

0  

2000  

4000  

6000  

8000  

10000  

12000  

14000  

16000  

18000  

Break  Bu

lk  Cargo,  M

T  

Containe

rized

 cargo,  TEU

s  

Year  

Containerize  Cargo,  TEUs  Break,  Bulk  Cargo,  MT    

Cargo handled at Birgunj ICD

¢  Developed by Govt. ¢  Operated by private sector ¢  Only rail linked ICD ¢  Rail link to Kolkata port -704

Km ¢  Emissions reduction ¢  5-16 trains/month ¢  Operation delayed due to rail

service agreement ¢  Initially containers- now

break-bulk, bilateral cargoes

Possibility  along  Phuentsholing-­‐  Kolkota  Bhutan-­‐  Mongla  (  Bangladesh)

Development  of  transport  and  logisHcs  industry  o  Guidelines  for  Minimum  Standards  and  Codes  of  Professional  Conduct  for  Freight  

Forwarders,  Non-­‐Vessel  OperaHng  Common  Carriers  and  MulHmodal  Transport  n  ClassificaHon  n  Government  regulaHon  and  industry  self  regulaHon  n  Minimum  capital  requirement  n  Staff  requirements  and  professional  training  n  LiabiliHes  and  liability  Insurance  n  Compliance,  monitoring  and  enforcement  n  Code  of  professional  conduct  

o  Guide  to  Key  Issues  in  Development  of  LogisHcs  Policy  o  Regional  Forum  of  Freight  Forwarders,  MulHmodal  Transport  Operators  &  

LogisHcs  Service  Providers&  MeeHng  of  Chief  ExecuHves    of  NaHonal  AssociaHons  o   Next  Regional  MeeHng  25  June  2015  in  Bangkok  h]p://www.unescap.org/events/freight-­‐forwarders-­‐mulHmodal-­‐transport-­‐operators-­‐and-­‐logisHcs-­‐services-­‐providers  

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Facilitation of International Road Transport

§  ESCAP resolution: 48/11–seven transport facilitation conventions

§  Road Traffic, §  Road Signs and Signals §  TIR Conventions, §  Temporary Importation of Commercial Vehicles, §  Customs Convention on Containers §  Harmonization of Frontier Controls of Goods, §  International Carriage of Goods by Road

§  Conclusion of Bilateral/Subregional/Regional Transport Agreements

§  Multilateral Framework Agreement-SAARC, BIMSTEC

Status of accession of ESCAP Regional Members to the international Conventions listed in Commission resolution 48/11, as of 25 February 2015

Country or area Convention on Road Traffic (1968)

Convention on Road

Signs and Signals (1968)

Customs Convention

on the International Transport of Goods under Cover of TIR

Carnets (1975)

Customs Convention

on the Temporary Importation

of Commercial

Road Vehicles (1956)

Customs Convention

on Containers

(1972)

International Convention on

the Harmonization

of Frontier Controls of

Goods (1982)

Convention on the Contract

for the International Carriage of

Goods by Road (CMR) (1956)

Group I: Mainland Asia Afghanistan x x Bangladesh Bhutan China x India x Nepal Pakistan x x Viet Nam q q Group II: Island countries Maldives Sri Lanka

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The Convention on Road Traffic, 1968 Objectives o  To facilitate international road traffic, o  To increase road safety, Key Provisions o  Binds Contracting Parties to admit vehicles and drivers in international traffic on

their territory, but preserves their right to refuse it; o  Establishes general and specific rules for drivers:

n  To be at all times able to control their vehicles; n  Must hold a driving permit, issued after tests; and n  Driving rules: speed, distance, overtaking etc.

o  Defines rules of behavior towards pedestrians, cyclists etc.; o  Establishes general rules for vehicles:

n  Must be registered, proved by a Registration Certificate; and n  To bear the distinguishing sign of the country of registration.

Benefits o  Establishes a set of agreed road traffic rules, reference for national traffic rules; o  Reciprocal recognition of vehicle certificates and driving permits; o  Facilitates international transport and tourism; and o  Provides for road traffic safety.

The Convention on Road Signs and Signals, 1968 Objectives To facilitate international road traffic; and o To increase road safety, through internationally agreed road traffic signs and signals. Key Provisions o  Defines three categories of road signs:

n  Danger Warning, Regulatory, Informative. o Establishes norms on shapes, dimensions, colours, visibility; o Establishes norms on traffic light signals, road markings; and o Defines road works and level crossings signs. Benefits o Defines over 200 reference road signs and signals; o Facilitates international road traffic, trade, tourism through harmonization; and o Provides for road traffic safety through education based on common standards.

The Customs Convention on the International Transport of Goods under Cover of TIR Carnets (TIR Convention), 1975 Objective

To facilitate the seamless international carriage of goods by road vehicles/containers across one or more borders, through a carefully designed border crossing procedure and an international guarantee chain, in partnership between public and private sectors. Key Provisions o Goods can be transported under the TIR regime only in secure, approved load compartment of vehicles or in secure containers; o An international guarantee system is covering all the transports under the TIR Carnets; o Mutual recognition of Customs controls: the control made at the Customs office of departure and the corresponding stamp and seals are recognized by all the Customs offices en route; o The TIR Carnet is both a Customs and a guarantee document; the guarantee provided amounts to a recommended maximum of USD50,000 (Euro 60,000 for some countries); o Controlled access of operators to the TIR System: only trustworthy operators can become TIR Carnet holders; and o SafeTIR electronic control system to strengthen the security of the TIR system through an electronic monitoring of the TIR Carnet lifecycle.

The Customs Convention on the International Transport of Goods under Cover of TIR Carnets (TIR Convention), 1975 Benefits o No need for inspection of goods at intermediate borders, as the validity of Customs control at origin is recognized by all Customs en route; o No need for payment of taxes and duties en route, as the TIR Carnet represents a guarantee for those taxes and duties; o Reduced border delays, transport costs and import/export costs; and o Increased competitiveness and growth.

The Customs Convention on the Temporary Importation of Commercial Road Vehicles, 1956

The Customs Convention on the Temporary Importation of Private Road Vehicles, 1954 Objective o  To facilitate temporary admission of commercial/private road vehicles

registered in another country; and o  Through agreed procedures and in partnership between the public and

private sectors. Key Provisions o  Creates the Carnet de Passage en Douane, an international Customs

document and guarantees vehicle duties and taxes if the vehicle is not re-exported; and

o  Establishes procedures for temporary importation, including for claims if no re-exportation of the vehicle takes place.

Benefits o  Internationally agreed procedure for temporary importation of vehicles and for

dealing with claims; o  No need for payment of vehicle import duties and taxes, as these are guaranteed

by the international guarantee chain through Carnet de Passage en Douane; o  Lower border delays and lower border costs; o  Lower transport and export/import costs; and o  Growth in tourism, as the facilities for commercial vehicles also apply to bus and

coach transport of persons for remuneration

The Customs Convention on Containers, 1972

o  Objective

o  To facilitate the temporary admission in a country of containers registered in another country by deferring payment of duties and taxes.

o  Key provisions

o  Common temporary admission procedures; o  No document requirements but clear rules for identification; o  Undertaking by owner provides guarantee for payment of Customs duties and

taxes in case container is not re-exported; and o  Prescriptions for secure sealing and use.

o  Benefits o  Minimum border procedures, deferred payment of Customs duties and taxes; o  Recovery of Customs duties and taxes if container not re-exported; and o  Facilitates international transport of goods.

The International Convention on the Harmonization of Frontier Controls of Goods, 1982 o  Objective To facilitate cross border transport of goods, through nationally coordinated, internationally harmonized, shorter, reduced formalities and controls on goods at borders. Key provisions o  Procedures for efficient border controls: Customs, medico-sanitary, veterinary, phyto-

sanitary, compliance with technical standards, etc. o  Coordination among various national services; o  Cooperation and coordination between border services of adjacent countries,

including: o  Joint controls, harmonized opening hours, same controls, etc. o  Annex 8 to the Convention covers the following aspects:

n  Facilitation of visa procedures for professional drivers; n  Operational measures to speed-up border crossing procedures for goods, particularly for

urgent consignments, such as live animals and perishable goods; n  Harmonized technical provisions relating to faster control of road vehicles (technical

inspections) and equipment used for transport of goods under controlled temperatures; n  Standardized weighing operations and procedures to avoid, to the extent possible,

repetitive weighing procedures at border crossings; n  Minimum infrastructure requirements for efficient border crossing points; and n  Monitoring provisions facilitating appropriate implementation of the Annex in all

Contracting Parties to the Convention.

The International Convention on the Harmonization of Frontier Controls of Goods, 1982 Benefits o  Lower border delays and costs for carriers and

export/import; o  Lower border operating costs for State budget;

and o  More efficient investments in border facilities.

The Convention on the Contract for the International Carriage of Goods by Road (CMR) Objectives o To facilitate international road transport, through a commonly agreed transport contract, including contract document and liabilities.

Key Provisions o  Defines contract conditions :

n The contract document: the consignment note; n Establishes carrier’s liability rules and limits of liability in case of total or partial loss of goods or delay.

o The e-consignment note has just been approved.

Benefits o Fair competition between carriers, and o Lower international road transport costs, including insurance costs.

Bhutan’s context o  Trade:

n  Trade largely confined to SAARC n  India major trading partner-84% of trade n  Bangladesh -2% of total trade n  Other SAARC countries- 0.5% n  Rest of world about 21%

o  Transport Connectivity: n  Road mainly with India (three major entry points) n  Air connectivity n  Proposed rail connectivity n  Dry port at Phuentsholing?

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The Way Forward: Sustainable Freight and Logistics Systems

o  Integrated transport planning o  Improvement of Transport and Logistics Infrastructure and

services o  Development of intermodal transport corridors o  Harmonization of rules and process o  Transport and trade facilitation measures-joining conventions o  Development of transport & logistics industry- engaging

private sector o  Application of ICT

n  Container tracking-RFID, GPS n  Border crossing and security n  Customs clearance technology-EDI

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