1. TRADE LOGISTICS AND COMPETITIVENESS
Henry Sandee
Trade Economist
World Bank Office Indonesia

2. The Challenge
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3. The Challenge

4. Dom shipping costly Corridors CY/CY (USD/TEU)
JAKARTA-SINGAPORE 180 – 245
SEMARANG-SINGAPORE 205 – 265
SURABAYA-SINGAPORE 200 – 215
JAKARTA – PORT KLANG 135 – 190
SURABAYA-PORT KLANG 175 – 240
SEMARANG-JAKARTA 270 – 300
SURABAYA-JAKARTA 300 – 480
BELAWAN-SINGAPORE
BELAWAN-PORT KLANG
JAKARTA-BELAWAN
JAKARTA-PADANG 600

5. Flow of Cargo Import Raw Material – Export The Finished Goods CFS
Flow of Sea Cargo Movement: Port to/from Factory
Inbound Cargo Movement
Stevedoring
Terminal Handling
CFS
Trucking
Factory
LCL
Transport
Transport
Overbrengen
W/H
Raw Material
W/H
Finsihed Goods
FCL
YOR >85%
Transport
1st Line Perimeter
2nd Line Perimeter
Out bound Cargo Movement
Stevedoring
Terminal Handling
Factory
FCL
Konsolidasi
CFS
LCL
Trucking
W/H
Raw Material
W/H
Finsihed Goods
FCL
Transport
1st Line Perimeter
2nd Line Perimeter

6. What the LPI does …
Trading behind, at and across borders
Helps countries to formulate a logistics strategy

7. www.worldbank.org/lpi Ranking of countries:
Logistics business environment
Performance data
Data gathered in more than 150 countries

8. The LPI measures seven dimensions of country logistics performance:
Efficiency of the clearance process
Quality of trade and transport infrastructure
Ease of arranging shipments
Quality of logistics services
Tracking and tracing
Timeliness (tepat waktu)
Domestic costs (trucking and shipping)

10. Key Findings
Performance often influenced by the weakest link in the supply chain
Reliability as important as transport costs and speed
Do not directly associate good logistics systems with low costs

11. LPI Ranks TOP 10 COUNTRIES UPPER MIDDLE INCOME TOP 10 COUNTRIES
LOWER MIDDLE INCOME
TOP 10 COUNTRIES
LOW INCOME
Country
LPI Rank
South Africa 24
Malaysia 27
Chile 32
Turkey 34
Hungary 35
Czech Republic 38
Poland 40
Latvia 42
Argentina 45
Estonia 47
Country
LPI Rank
China 30
Thailand 31
Indonesia 43
Jordan 52
Bulgaria 55
Peru 59
Tunisia 60
Brazil 61
Philippines 65
El Salvador 66
Country
LPI Rank
India 39
Vietnam 53
Sao Tome and Principe 57
Guinea 62
Sudan 64
Mauritania 67
Pakistan 68
Kenya 76
Gambia, The 77
Cambodia 81

12. Key Policy Implications
Expand the traditional reform agenda beyond customs reform and infrastructure development
Embark on comprehensive reform—value chain approach
Need for broad public and private support: there should be quick wins
Tailor reform to the each country’s circumstances

13. Changes in logistics performance
New survey: May
first results in May-June 2009
New improved questionnaire
inclusion of a Customs module
Assessment of changes in logistics performance will be possible

14. Logistics reform in Indonesia
The Government of Indonesia prepared a logistics blueprint and action plan
LPI helped to identify and quantify bottlenecks (weakest link)
Choke points identified (e.g.Cikarang – Tanjung Priok)
Collaboration with the Thai logistics council
Grand strategy versus quick wins

15. SME and logistics
Small amounts, can afford poor transport services only, poor service providers
Less than one container loads
60 percent of Indonesian SME exports do not arrive at their final destination on time and/or with agreed quality
How to solve this problem: any role to play for the government?

16. SME and logistics - clusters
Standardization – learning by seeing
Easier to export full container loads
Easier to involve (foreign) buyers in handling the export trade process

17. Contact: tradefacilitation@worldbank.org
Contact Us
The World Bank Group International Trade Department
Washington Office
1818 H Street NW
Washington DC 20433
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