GENEVA — Delays and congestion in roadway border crossings, coupled with cumbersome clearance procedures and corruption, is costing the world economy billions of dollars annually in extra costs, lost duties and tens of thousands of jobs, according to an International Labor Organization report.
The study said that increased demand for just-in-time deliveries, along with the need for more secure and reliable multimodal, door-to-door transport services, have intensified the level of road transport.
“International transport and logistics companies are purchasing modern vehicles and spending more on technologies, crews, containers and management than ever before,” the ILO report said.
The study estimated that truck hauling makes up 86 percent of U.S.-Mexico trade and 70 percent of U.S.-Canada commerce. However, road transport delays and congestion at both borders are costly for companies and the economies of the three North American Free Trade Agreement countries.
On the U.S.-Mexico border, delays are estimated to have cost the two economies “$6 billion in gross output and more than 51,000 jobs in 2005,” the report said.
The study pointed out that road transport in the NAFTA region also suffers from inadequate infrastructure, absence of trained workers and bottlenecked procedures. In 2003, a total of 6.7 million trucks crossed the U.S.-Canada border and 4.2 million crossed the U.S.-Mexican border.
Problem areas identified by the U.S.-Mexico Chamber of Commerce and cited in the report include duplication of effort, lack of automation and inadequate communication among government agencies.
An analysis of the Laredo-Nuevo Laredo border crossing, which 10,000 to 15,000 trucks use daily, flagged problems such as restrictions imposed by the U.S. and Mexico; excessive stops making cargo more susceptible to damage, loss and tampering; limited capacity of some inspection areas and lack of government motivation to ensure the personnel required to provide inspections 24 hours a day.
Moreover, in the case of the U.S., the “issue of security has also slowed down border-crossing procedures,” the report said.
ILO transport expert Marios Meletiou, who wrote the study, said “improved container technology and new control-technologies procedures in border crossing should help ease the situation.”
The report indicated the problems are even more costly and problematic in other regions. In Europe, road traffic generates 91.5 percent of the continent’s 530 billion euro, or about $680 billion, per-year congestion costs.
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Road transport crossings between South Asian textile and apparel exporting countries India and Bangladesh require, under Indian procedures, 29 documents, 118 copies and 256 signatures, and by Bangladesh, 22 documents, 116 copies and 55 signatures.
Similarly, in 2004 in many poor African countries, the average customs transaction involved 20 to 30 different parties, 40 documents and rekeying of 60 percent to 70 percent of the 200 data elements required, the report said. Harassment, extortion and bribes from drivers to customs officials and traffic police is also a problem in many countries, according to the report. The problem is particularly acute in Russia, Ukraine and many sub-Saharan African countries, it noted.
“The system of corruption amongst officials performing control procedures in road transport is deeply rooted within official structures,” concludes the report.
Long delays are also common in many border crossings in Eastern Europe — up to 72 hours in some cases — and in many African nations.
Positive moves are under way, however, to remove obstacles and enhance cross-border flows, such as the recent decision by customs authorities of Hong Kong and Shenzhen to remove customs inspections for the border, the report said.
“Instead, inspections will take place at a logistics center in Shenzhen, and trucks will be able to pass through an express lane at the Hong Kong-Mainland border,” the study said.