1. International Conference “Europe looks East” Sofia, 7-8 October 2010
The Challenge of the Logistics Chain to better seize the Advantages of Globalisation
International Conference “Europe looks East” Sofia, 7-8 October 2010
Dear Chairman, Distinguished participants,
It is not only an honour but a pleasure for me to be here today to share with you the vision and the challenges facing our organisation which acts through its 180 members in 74 countries.
For most people, electricity comes from an electric plug regardless of what is behind to produce it.
For most people also, road transport is always and immediately available on a simple query by telephone.
This is why it is my duty today to explain what is behind that telephone call and the challenge for the logistics chain to better seize the advantages of globalisation.
While everyone knows that road transport, through its door-to-door service is always at the start and the end of each transport operation, nobody recognises that road transport, which carries more than 85% of all goods, is a fundamental element of competitiveness for every country and has become a vital production tool.
Martin MARMY Secretary General

2. Globalisation and the Challenge of the Logistics Chain
What does it take to have a cup of coffee in a café?
Let me explain with the simple example of a cup of coffee what globalisation and the logistics chain is.
In Europe, to have a cup of coffee [click] requires the collaborative efforts of 29 companies from 18 countries.
Only road transport is able to interconnect all these businesses. [click] This is why road transport has become a vital production tool.
The combined efforts of
29 companies in 18 countries
Road transport has become
a vital production tool!
Source: IRU
© International Road Transport Union (IRU) 2010

3. Road transport is the lifeblood of the economy everywhere
Road transport’s role in the logistics chain in the modern economy is clear!
86% of road transport is carried out over short distances – less than 150 kilometres – and only 0.9% of road transport is carried out over distances of more than 1,000 kilometres.
This is why road transport, like the current in an electrical wire or the blood in the human body, should never suffer from any restriction or blockage, but should be further facilitated.
© International Road Transport Union (IRU) 2010 3 3

4. Evolution of sea containers in ports in 1971
Allow me now to explain the role of containerisation in the globalisation of the economy.
Container movements in the main ports started with the birth of world containerisation only 40 years ago.
In the 1970s, there was a high number of ports linked by a high number of small container vessels.
© International Road Transport Union (IRU) 2010

5. Evolution of sea containers in ports in 1980
In the 1980s, before globalisation, bigger vessels were serving five emerging ports – New York, Rotterdam, Hong Kong, Shanghai and Singapore.
© International Road Transport Union (IRU) 2010

6. Evolution of sea containers in ports in 1990
In the 1990s, Asian economic development takes off. Globalisation starts with the huge growth in Asian trade with Europe, as well as across the Pacific to California.
© International Road Transport Union (IRU) 2010

7. Evolution of sea containers in ports in 2000
In 2000, the same trend continues at a much higher speed. The globalisation of trade by sea container reaches all the main markets of the world.
© International Road Transport Union (IRU) 2010

8. Evolution of sea containers in ports in 2010
The 2010 situation demonstrates that more than 80% of world trade is transported to the main markets through only 40 ports!
Due to this concentration of containerisation, all the main ports are congested!
As demonstrated by this slide, this concentration of 80% of world trade in only 40 ports creates not only congestion and costs in all these ports, but above all [click] a vast desertification of trade development in numerous important regions that most require economic, social and political stability, such as Asia, Africa and Latin America.
The red arrows clearly demonstrate that numerous regions, in particular the Central Asian countries which are landlocked to sea transport, do not benefit from the globalisation of trade like the other regions of the world.
This is why, for more than 20 years, the IRU has been striving to create peace and prosperity - not only in a handful of ports - but in all other regions by interconnecting by road transport all the businesses, notably along the ancient Silk Road.
© International Road Transport Union (IRU) 2010

9. Satellite Intercepts of the World’s Telecommunications in a 24-Hour Period
Modern Activity Gap: The blank swath in the northern hemisphere is centred on Central Asia!
This desertification of economic activity in the same regions is also confirmed by the density of satellite communications.
Indeed, the red arrows [click] demonstrate that the same Asian, African and South American countries, are excluded from communications and therefore from the globalisation of trade.
Source: Centre for Strategic International Studies (CSIS), Washington, DC
© International Road Transport Union (IRU) 2010

10. IRU New Eurasian Land Transport Initiative - NELTI
NELTI Results
41 % unjustified levy paid
39 % of waiting time at borders
To better connect by road the countries of Central Asia to China and the European Union, the IRU developed over the past few years the IRU New Eurasian Land Transport Initiative or “NELTI” project under which numerous trucks carrying commercial goods systematically record all the impediments on the road.
The NELTI results are clear. The real problem faced by international road transport is not the lack of road infrastructure. The real problem is the totally inappropriate procedures at border crossings, where 41% of unjustified payments are requested and 39% of driving time is lost.
© International Road Transport Union (IRU) 2010 10

11. Need to implement the IRU Model Highway Initiative (MHI)
The appropriate procedures needed
Accession to and effective implementation of international agreements and conventions on trade and road transport facilitation
Introduction of effective border crossing procedures based on international regulations
In summary, on the basis of the results of the NELTI project, the IRU has developed the IRU Model Highway Initiative (MHI) to implement, together with the governments concerned, the appropriate procedures needed to connect by road transport all the businesses in Central Asia to the world markets.
Such interconnection through the implementation of the IRU MHI does not require massive financial investment, as very often recommended by high-level consultants of financial institutions, but simply require the effective implementation, by the governments concerned, of the UN facilitation instruments which have proven their efficiency for 60 years in numerous other countries.
To conclude, to have a better future together, allow me to modify the title of this forum to “Europe MUST look east”!
Thank your for listening. Thank you for helping me to help all these countries to be better interconnected to all the main world markets by road transport by implementing the Model Highway Initiative.
Simplified procedures for allocation of land along the model highway
Reduction of border waiting times jointly with anti-bribery action plan
© International Road Transport Union (IRU) 2010

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© International Road Transport Union (IRU) 2010