Brave new World

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It’s surprising, but true. Despite stringent security measures put in place for the movement of cargo following 9/11, worldwide trade has actually speeded up.

According to The World Bank’s 2007 ‘Doing Business’ report the burden of inspecting and screening containers post 9/11 initially created problems at ports, especially in developing countries, but in the last two years security proceedures have been greatly enhanced by the use of risk management systems that can identify high risk containers by looking at port and company of origin.

Serbia, the report’s best performer, has cut the time for importers to clear incoming goods from 44 to just 12 days.

But further to this, automated means of filing cargo declarations in advance and paying tarrifs electronically has also had an influence on speeding the flow of international trade. Even in Pakistan, where security issues are particulary pertinent, time taken for an import consignment to clear has been cut from 39 days to 19.

This is all just as well considering the World’s growing dependence on international trade, global sourcing strategies and the outsourcing of manufacturing to places far from their consumer markets. Globalisation appears to be continuing apace, despite the spectre of international terrorism and its commensurate port security measures.

And yet, there are dangers of another nature. International research findings from the AberdeenGroup – reported in our feature ‘Global warning’ on page 26 of this issue – reveal that the financial productivity of corporations are being undercut by a lack of global supply chain visibility and automation. It appears that poor visibility of products in the global supply chain is resulting in an excess holding of inventory as a hedge against uncertainty.

Once again it’s technology that holds the key. Applications are available that can greatly reduce uncertainty and give total landed costs. It’s just a matter of using them.

Nick Allen, Editor

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