1. Prospects for the Caribbean as a Gateway to North America
Jean-Paul Rodrigue
Associate Professor, Dept. of Global Studies & Geography, Hofstra University, New York, USA
TIMEFRAME: 40 minutes

2. Academia: Don’t know much and don’t get no respect
(At least we’re not economists…)
Academia: Don’t know much and don’t get no respect

3. Words I Promise not to Utter…
Bullshit
Crap
WTF
Bitch
Pot smoking
Confused
“Supercalifragilisticexpialidocious”

4. Pacific Asia / American East Coast
Main Export-Oriented Regions and Shipping Routes Servicing North America
Pacific Asia / American East Coast
Intermodal (60%)
Western Canada (5%)
All Water (40%)
Pacific Northwest
(20%)
Via Suez (5%)
Pacific Southwest
(75%)
Via Panama (95%)
Mexico (?%)

5. CRB Index (CCI), Monthly Close, 1970-2011
Paradigm shift in input costs…
Reaping the consequences of monetary policy.
Source: Commodity Research Bureau.

6. West Texas Intermediate, Monthly Nominal Spot Oil Price (1970-2011)
This is also going to propagate along supply chains.
Steaming, slowly…
Source: Federal Reserve Bank of St. Louis.

7. At the Crossroads… Which Value Proposition for the Caribbean?
1) Strong margins, but many not large enough to justify full dedicated services
3) East coast capacity issues
2) Interlining between the America’s coastal systems
4) Last segment in import-based supply chains - +

8. Southwestern Seaboard
The North-American Container Port System and its Multi-Port Gateway Regions
Puget Sound
Northeatern Seaboard
Gateway
Entry
Load change
Clearance
Source: Rodrigue, J-P and T. Notteboom (2010) "Comparative North American and European Gateway Logistics: The Regionalism of Freight Distribution", Journal of Transport Geography.
Southwestern Seaboard
San Pedro Bay
Gulf Coast
Southern FLorida
The Caribbean Gateway?
(RIMS)
Pacific Mexican Coast

9. Conditions suitable to the formation of a “Caribbean Gateway System”
Transshipment
Logistics and foreign trade zones
Information systems integration
Safe and secure customs pre-clearance
Harmonization of trade relations
(e.g. Free Trade Agreements; Panama, Columbia)

10. The Transshipment System

11. The Insertion of Intermediate Hub Terminals
Hub-and-Spoke
Relay
Interlining
85% of Transshipment Traffic
15% of Transshipment Traffic

12. Major ports and future terminal developments in non-EU Med ports: impact of a changing political landscape?
Container throughput in million TEU, capacity extensions in million TEU
Enfidha (Tunisia)
Capacity: +1 (2011)
+2.5 (period )
+2 (period )
Rades (Tunisia)
Traffic: 0.3 (2007)
Djendjen (Algeria)
Capacity: +2 (DP World)
Bejaia (Algeria)
Traffic: 0.15 (2008)
Capacity: +2.5 (>2010)
Algiers (Algeria)
Traffic: 0.5 (2007)
Capacity: +0.8 (2010)
Ambarli (Turkey)
Traffic: 2.26 (2008)
Mersin (Turkey)
Beirut (Lebanon)
Traffic: 0.95 (2008)
Haifa (Israel)
Traffic: 1.39 (2008)
Transshipment Corridor
Tanger Med II
APMT/Akwa: + 3 mln TEU (2012)
PSA: +2 mln TEU (2012)
Tanger Med
APMT: mln TEU
Eurogate: +1.5 mln TEU
Damietta (Egypt)
Capacity: +4 (2012)
Misurata (Libya)
Initial plans cancelled?
Port Said (Egypt)
Traffic: 3.2 (2008)
Capacity: +2.5 (2011)
Source: Notteboom (2009)

13. Tanger Med: The Cartagena of the Mediterranean…

14. Conventional Direct Transshipment Circum-Equatorial North Atlantic
Central
Atlantic
South Atlantic / Gulf
Transshipment
Circum-Equatorial
North Atlantic
North Atlantic
Central
Atlantic
Central
Atlantic
South Atlantic / Gulf
South Atlantic / Gulf
Caribbean
Transshipment
Triangle

15. The Caribbean Transshipment Market: Triangle or Corridor?
Location (+)
Depth (=)
Land (=)
Costs (+)
Hinterland (-)
Ownership (+)

16. Possible Options in the Development of a Transshipment Hub
Location and costs advantages
Dependent on shipping companies and global terminal operators
Pure Transshipment Hub
Logistic zones and inland load centers
Hinterland Gateway
Port-centric logistics zones
Gateway to a regional freight system
Foreland Gateway

17. S “Sovereign” Class (8,000 TEU)
The Big Port Squeeze: Largest Available Containership, (in TEUs)
E “Emma” Class (12,500 TEU)
S “Sovereign” Class (8,000 TEU)
R “Regina” Class (6,000 TEU)
E “Emma” Class (2006)
S “Sovereign” Class (1997)
R “Regina” Class (1996)
L “Lica” Class (1981)
L “Lica” Class (3,400 TEU)

18. Hinterland-Based Regionalization Foreland-Based Regionalization
Pushing Atomization in the Hinterland and Massification in the Foreland
Capacity
Frequency
Atomization
Hinterland-Based Regionalization
Different momentums
Economies of scale
Functional Integration
PORT HINTERLAND
Capacity Gap
Frequency Mitigation
PORT FORELAND
Massification
Economies of scale
Foreland-Based Regionalization

19. The Insertion of an Intermediate Hub as a Gateway
Inland Terminal
HINTERLAND
GATEWAY
FORELAND
Main Shipping Lane
INTERMEDIATE HUB
(Caribbean)

20. A Taxonomy of Logistic Zones
Port B
Port-Centric
Freight Village
Corridor
Intermodal Industrial Park
Inland Port A
Industrial Park
A) Inland terminal
B) Freight services

21. Port Centric Logistics Zones: The Search for Added Value
Port Terminal
On-Dock /
Near Dock Rail
FTZ / Manufacturing
Container Depots
Consolidation / deconsolidation
Transloading
Postponement

22. The “Terminalization” of Logistics
Terminal as a constraint
Rational use of facilities to maintain operational conditions
Storage space, port call frequency, gate access
Volume, frequency and scheduling changes
Bottleneck-Derived
Terminal as a buffer
Incorporating the terminal as a storage unit
“Inventory in transit” with “inventory at terminal”
Reduce warehousing requirements at distribution centers
Warehousing-Derived
Terminalization: Growing influence of transport terminals in the setting and operation of supply chains in terms of location, capacity and reliability.

23. Panama Canal Expansion and Supply Chain Differentiation: Pick Your Preference
Costs (38%)
Stability of the cost structure.
Relation with the cargo being carried.
Lower costs expectations by the Panama Canal expansion.
Time (12%)
Influence inventory carrying costs and inventory cycle time.
Routing options in relation to value / perishability.
No/limited time changes with the expansion.
Reliability (43%)
Stability of the distribution schedule.
Reliability can mitigate time.
AWR has a reliability advantage.

24. Comparative Advantages in Supply Chain Preferences: A Complex Balancing Act
Shipping Rate from Shanghai for a 40 Foot Container, Mid 2010
Vancouver
Montreal
$2,300
$2,110
$4,040
$3,950
Time
New York
$3,700
$1,830
Los Angeles
Costs
$2,620
$1,400
$3,510
$2,560
Houston
Inbound rates: function of distance
Outbound rates: function of trade imbalances
Reliability (?)
$1,300
$2,100
Inbound
Outbound

25. RIMS as an IT Triangle: Key Information Technology Drivers in Freight Distribution
Freight Visibility (tracking)
Improve the reliability of supply chain management.
Status and locations of shipments (vehicles, rail cars, containers and individual loads).
Mobile communications and Global positioning systems (GPS).
Radio-frequency identification (RFID) tags and bar codes.
Asset Management
Maximize equipment utilization.
Equipment location (tractors, trailers, rail cars, containers, ships).
Real Time Locating Systems (RTLS; GPS and RFID tags).
Status monitoring of vehicle and cargo conditions.
Efficiency Improvements
Improve productivity and reduce errors in data transmission.
Verification and exchange of shipment information.
Non-intrusive inspection and information technologies such as optical character readers (OCR), RFID tags and bio-metrics (to identify drivers).
Freight Information Exchange
Information exchange using web-based technologies and electronic data interchange (EDI).
Real-time terminal information systems.
Regulatory Compliance
Pre-screen loads and direct low-risk freight to quick clearance.
Enhance security at international borders.
Electronic pre-notification of shipment information.

26. Conclusion: The Caribbean Looking Beyond Transshipment1
Gateway function an option for the Caribbean transshipment triangle 2
Economies of scale both changing the hinterland and the foreland 3
Convergence of suitable conditions (Transshipment, logistics, IT, customs, trade)