São Paulo – Brazil has fallen in the world logistics ranking for trade, according to a research disclosed by the World Bank on Tuesday (16). The country dropped from the 41st place in the previous list, published in 2010, to 45th in the current list. The study was developed with around 1,000 international operators in the sector and includes information about 155 countries.
The Brazilian fall in this edition of the report took place after the country’s climb from the 61st position in the first edition, in 2007, to the 41st rank in the second ranking, in 2010. The country performed badly in the “customs” category, one of the indices in the ranking. In the area, Brazil came in 78th place, with 2.51 points. Points range from 1 (worst) to 5 (best).
Among the 10 “upper-middle income” countries with the best performance, Brazil comes in the 9th position, only ahead of Mexico. Of these nations, only Brazil and Thailand dropped in the 2012 ranking. South Africa, China, Turkey, Bulgaria, Chile, Tunisia and Mexico climbed, while Malaysia remained in the same position.
According to François Arvis, one of the authors of the study, there is no simple explanation for Brazil’s change in rank, but other nations probably progressed more in the area, whereas the country is still struggling to improve its ports and customs systems under the pressure of a growing economy and trade.
The index includes not only customs matters, but also figures regarding infrastructure, domestic freight, logistics quality and competence, track and trace availability and punctuality. Brazil’s average grade was 3.13. Singapore, in the top rung, got an average grade of 4.13.
Distance
One of the main conclusions of the research is that from 2010 to 2012 there was no change in distance from the countries with worse performance to the countries with the best performance, whereas from 2007 to 2010 this difference had dropped. Furthermore, the rhythm of sector growth as a whole has also dropped. “We believe that this is because of the global recession,” said Mona Haddad, a sector manager at the World Bank’s International Trade Department, in a video broadcast on the organisation’s site.
According to the report, such stagnation “probably” reflects a change in government focus in the struggle against the financial crisis and, more recently, against the crisis in the Euro Zone. Reforms in the logistics area are no longer priority and the reduction in expansion of the customs clearance index “could reflect an unusual focus on revenue collection at the expense of trade facilitation”.
Haddad pointed out that logistics is essential for a nation’s competitiveness. “Companies can be producing very efficient goods at very good prices, and yet, by the time they ship them to another country, they lose this competitive advantage because of all the inefficiencies in shipment and in transport,” she said.
Rich nations are in the top positions in the ranking and the poorest nations are in the last. To Haddad, investment in infrastructure is the main motor for logistics development in the countries with the best evaluation, and all of them show “strong cooperation between the public and private sectors”.
The bank points out that countries that implemented “aggressive reforms” in the area of logistics are still improving their grade. As examples, she mentions Chile, China, India, Morocco, South Africa, Turkey and the United States.
Arabs
Morocco, a nation in North Africa, for example, has jumped from the 113th place in 2007 to 50th in 2012, “having implemented a comprehensive strategy to improve logistics and connectivity and take advantage of the country’s proximity to Europe”. For such, the country reformed border controls and invested heavily in infrastructure in the Tangier-Med port. This, according to the study, fostered the country’s “just-in-time” exports of goods to the European market, especially textiles, electronics and auto parts.
Other Arab countries have improved their positions in the ranking, like Tunisia, which climbed from the 61st position in 2010 to the 41st in 2012, Egypt (92nd to 57th) and Yemen (101st to 63rd). The United Arab Emirates is the country in the region in the best position in the ranking, 17th place, followed by Qatar (33rd) and Saudi Arabia (37th).
The report also shows that logistics is important for food safety, as it affects the price and availability of foods. This question is specifically sensitive in the Middle East and Africa, regions that depend much on imports.
*Translated by Mark Ament
