APPENDIX 5 BUILDING UP A SUSTAINED PUBLIC-PRIVATE PARTNERSHIP

Transcription

1 APPENDIX 5 BUILDING UP A SUSTAINED PUBLIC-PRIVATE PARTNERSHIP A. Background and Strategies B. Access to Knowledge in the Field of Transport and Trade Facilitation C. The contribution of training to transport and trade facilitation A. Background Both public institutions and private enterprises are part of the full trade and logistics chain. Therefore both the public sector and the private sector must be effective and co-operate on making the Caucasus more attractive to traders and investors. The level of dialogue between public and private parties in the Caucasus is currently too limited to ensure that laws and regulations are suitable for the provision of efficient trade supporting services. Consultation with professional associations takes place on an ad hoc basis and does not provide for a long term constructive dialogue, ensuring that a suitable enabling environment is being established. Public-private partnership can be an efficient and cost-effective tool to pull down the numerous barriers that exist in the region, especially for countries in transition with scarce resources. During the debate, two possibilities to institutionalize the partnership between the public and private sector were identified as suitable for the specific situation in the region. The first one, was based on the case of the Bulgarian Pro-Committee (BULPRO). BULPRO was established by a Governmental decree and brings together, under the umbrella of the Bulgarian Chambers of Commerce and Industry, competent authorities, business support organizations and large private companies. The main goal of BULPRO is to harmonize the trade-related documentation and procedures with those prevailing in the international trade exchange in order to facilitate international trade and transport. The second possibility was presented by the recently established National Commissions within TRACECA, under the framework of the TRACECA Multilateral Transport Agreement (Baku, September 1998), with the main goal to facilitate trade and transport within the TRACECA region. The international organizations were also formally invited to participate in the work of these TRACECA inter-governmental commissions, created under the mentioned agreement. The main distinctive feature between both approaches is that the former is a non-governmental structure with the participation of experts from the competent authorities. While the latter is an essentially governmental body with the private sector participating with a consultative status. 1

2 The debate showed that the two approaches are complementary and can be used in combination depending on the concrete circumstances in each individual country. The debate also focused on the possible mechanisms to achieve an efficient public-private partnership among the stakeholders. The use of outside partners with an observer status like the IRU or the World Bank, may provide for closer monitoring and accountability of the process. Another mechanism could be the use of mass media in order to ensure transparency and public accountability of processes and the functioning of the administration. Non-governmental organizations could also play an important role in channeling the industry s concerns to both authorities and media. A conclusion was drawn that the various representative professional or non-governmental organizations, such as road transport associations, associations of freight forwarders and shippers, could play this role either directly or under the umbrella of the national chambers of commerce, which represent the interests of the entire business community. Strategies Continuously consulting the private sector through regular meetings, providing possibilities for the private sector to raise new issues; Design and implement in common trade facilitation measures targeting efficient procedures and documentation; and Make available all applicable rules and regulations to all participants as they become applicable. B. ACCESS TO KNOWLEDGE IN THE FIELD OF TRANSPORT AND TRADE FACILITATION Goal Institutionalising the process of collection, processing and disseminating of information and the provision of quality training in the field of transport, logistics and trade facilitation in the Caucasus region. Background There is a need for improvement of the business environment in Armenia, Azerbaijan and Georgia in order to attract the necessary private investments to promote socio-economic development. An important component of the improvement of the business environment is the 2

3 facilitation of transport and trade. This can be realised by removing the barriers which impede seamless transport and trade flows. In order to comply with the changing demands of customers, the transport and trade industry must continuously develop its products and services based on continuous upgrading of knowledge. This can be done through client/market driven training. Major part of the ideas on innovation in the industry originate from co-operation between the transport providers, customers and the suppliers of new technology. Co-operation at national and regional level between associations, trade unions, education systems, the industry and governmental structures is a requirement for an efficient, fair and transparent system. Private training and knowledge providers, consultants and relevant organisations will, also in the future, cover a substantial part of the transfer of knowledge on pure market conditions as the transporters themselves have the incitement to develop or secure knowledge to increase their revenue and profit. There is a need for removing barriers and improving management and co-operation in the logistics chain between different transport providers and transport buyers, not least in connection with tailor- made transport of specific commodities and third party logistics. There is also a need for developing new and more effective concepts for multimodal transport, e.g door to door solutions, shuttle service, container handling, reloading technology or operation of multi-terminals and distribution centres. Strategies I INNOVATION Establishment of a forum for the private and public sector in the field of transport and trade facilitation to propose innovative solutions for barriers to transport and trade facilitation at national and regional level. Establishment of a regional knowledge institute in the field of transport and trade facilitation linked with a network of national centres in Armenia, Azerbaijan and Georgia. Establishment of structures for exchanges in the Caucasus and common website on transport and trade facilitation. II PARTNERSHIP Development and provision of training for shippers, transport operators and forwarders in partnership with the business sectors. Development of a shared vision to develop transport and trade in the Caucasus region leading to international standardisation and harmonisation with complete transparency. 3

4 Activation of trade, transport and forwarders associations and non-governmental organisations in knowledge collection, processing and dissemination. Co-operation between the transport sector, transport users and education/training institutions in logistics and transport training. III EDUCATION Overall scheme for education system and levels in transport and logistics, including institutionalisation of training of transport operators and forwarders. IV FINANCING Public co-financing of a Regional Knowledge Institute for Transport and Trade Facilitation with main focus on the institute s research activities in collaboration with the business environment. Overall financing plan for training in transport and trade facilitation. C. The contribution of training to transport and trade facilitation Experiences from foreign funded projects in the Caucasus Region René Meeuws NEA Transport research and training Project Manager The main objective of this Caucasus Trade Facilitation Workshop aims at the preparation of national and regional strategies and action plans to facilitate trade through legal improvements and attraction of private investments in infrastructure. The topic of my contribution is focused on how training can contribute to the facilitation of trade and transport. Before continuing on this training issue it is important to reflect a bit on the barriers which impede seamless trade and transport flows, especially in the Caucasus region. Because knowing the barriers is the first step in removing them. And training may, indeed, play an important role in this process of removal. In discussing the barriers to trade and transport I would like to make a distinction between the external environment in which trade and transport functions and the internal operations of trade and transport. It is obvious that external environmental factors are much more difficult to influence than internal operations. 4

5 We will divide the barriers to trade and facilitation related with the external environment into four categories: legal and administrative barriers economic, financial and fiscal barriers technical barriers practical barriers legal and administrative barriers Most of the barriers that internationally operating trade and transport companies are facing in the Caucasus region are of a legal or administrative nature. Sometimes it is difficult to get access to international markets due to national criteria meant to protect the interests of the national industries. These difficulties sometimes manifest themselves in tough negotiations between the Ministries of Transport of two countries about the number of bilateral permits. There is also a structural shortage of multilateral permits (the so-called CEMT or ECMT permits). The criteria for obtaining these multilateral permits are becoming more and more strict: Euro 2, Euro 3, Euro 4, Euro 5, etc. Only the green, greener, greenest lorries are authorised to drive under these multilateral permits, which is favouring the already developed road transport industry in financially better equipped countries. The system of different bilateral and multilateral permits is relatively complex and further standardisation would be most welcome. Many countries also apply restrictions on transit traffic and cabotage. Good examples, but maybe good is not the right word, of countries which apply such restrictions are Austria and Switzerland where large amounts of money have to be paid by transit traffic. Some countries even put explicit restrictions concerning transit traffic and/or cabotage towards certain other countries. For some countries the procedures for obtaining visa for the professional drivers for other countries are very time consuming. Especially visa for the Schengen countries for drivers from Central and Eastern Europe, the Caucasus and Central Asia can take much time and effort. Although a lot of effort is being put in improving the performance of the customs officers at the borders, they still remain understaffed and do need further training. The procedures at border crossing points is still complex and national laws and regulations are changing very often. So often that sometimes even the customs officers are not aware of these changes. And there is also still a lack of standardisation of customs procedures: different countries have different national laws and different national regulations. 5

6 There is also a lack of standardisation of commercial, technical and administrative documents concerning trade and transport and also the requirements for these documents are changing very rapidly. To have legislation is one thing, to put legislation into practice is another. Even when legislation is standardised, and that would be a great step forward indeed, there is no guarantee that legislation is being enforced properly, creating unequal conditions in trade and transport. Harmonisation should also be achieved in the enforcement of legislation to establish a level playing field for the international and national trade and transport industry. Many countries still put legal obstacles for establishing non-resident branches by foreign companies, also to protect the interests of the national industry. Also legal restrictions sometimes apply for adapting the organisational structure of trade and transport companies. Finally, I would mention the fraud in TIR system, which became imminent in the early nineties. This caused the IRU to build a new, more secure system, called SAFETIR, which facilitates the electronic monitoring of the cargo and thus reducing the fraud enormously. All these legal and administrative barriers have a very negative influence on the performance of trade and transport. They mostly can be overcome by international and national negotiation and political decisions. Training can play an important role in this process by showing the huge macro-economic costs caused by excessive and discriminatory legislation and red tape. It can show the advantages of standardisation, harmonisation and enforcing of legislation, and thus establishing a level playing field. It can show the benefits of adopting another system of trade and transport focused on facilitation, promoting socio-economic interaction. economic, financial and fiscal barriers The transport operators in the Caucasus region are facing many economic, financial and fiscal barriers as well. The transport infrastructure is not well developed because of lack of financial resources to investment in this sector. Lack of funds also cause a huge backlog in rehabilitation and maintenance of existing infrastructure, resulting in an increase in transportation costs (longer journeys and faster depreciation of the transport fleet). To revert this downgrading process is a very difficult, but necessary task for each Government. The economic crisis since the changes in the 1990s is still manifest. The geographical pattern of trade and transport flows is still in a process of change and not stabilised yet, not in the least because of political problems that exist between some countries. 6

7 This lack of financial resources brings the governments to an understandable, but nevertheless not correct policy on levying high import taxes on transport equipment. These measures are also meant to protect the own national supply industry of transport equipment. One can say that arbitrary and often discriminating taxes still prevail in many countries, frustrating any effort towards establishing a level playing field. The transport operators lack financial resources to renew their fleets. The interest rates are very high. They also lack financial resources for insurance and even have to ask for pre-payment to buy things like fuel. The consequence is that they are not allowed to operate on European markets because of the strict regulations regarding the technical standards of the transport means. Finally, some transport operators consider the membership fees for the associations rather high. In order to operate on the international market and to make use of TIR carnets, membership of a TIR carnet issuing association is obligatory. Especially the small hauliers have difficulties paying this membership fee. What can training do about all this? Not much, at the first sight. Of course, transport operators can be better trained in modern financial management techniques. But workshops on economic and financial policy related with trade facilitation would have a more direct and profound impact. technical barriers Some technical barriers are a direct consequence of the just mentioned financial barriers. As said before, the vehicle fleets are in a poor technical condition, have high fuel use and are rather polluting. This not only increases the costs of the transportation process, but also put the sustainability of the entire transport company into danger on the long term. One day the vehicle will break down and the operator will not have sufficient money to buy a new one. High transport costs are also caused by insufficient transport infrastructure and poor telecommunication systems. practical barriers To end up the list of barriers related with the external environment, some practical barriers. Shortage of practical information. Trade and transport operators are still lacking relevant practical information. However, the associations, strongly supported by IRU and FIATA are working very hard in filling the gap and providing this information. The use of modern technology makes this process more efficient and even cheaper. In this field training can play an important role. 7

8 Perceived lack of reliability of drivers from Caucasus by European companies. This problem is largely an image problem, which can be overcome by good communication. Also here standardised training of professional drivers with official established examination procedures can play an important role in eliminating this practical barrier. The same applies for road transport operators and freight forwarders. We will come back to that later. Criminal attacks on drivers, trucks and loads, bribes and protection money. Although stricter enforcement of the law is certainly necessary, also this problem is for a part an image problem. The situation is often exaggerated by some bad experiences. No facilities at border crossing points. This problem can be solved by investments in border infrastructure. The Worldbank is quite active in this field of activity. Resistance to transit in some countries, traffic bans. Already discussed before. Then we now come to the barriers to trade and transport related with the internal operations, the barriers linked with knowledge and experience. We will mention the following: drivers not well trained, including language lack of knowledge payment conditions, procedures, legal issues international transport lack of knowledge marketing and management, free market principles lack of knowledge on how to get return loads lack of knowledge regarding modern logistics lack of knowledge of cost calculation and relation to price setting We already mentioned the need to train professional drivers not only to improve the performance of the transport operations, but also to improve the image of the sector. This training should include language training as well, especially for international transport. There is also a lack of knowledge of practical issues like payment conditions, border procedures, transport handling procedures, regulations, etc. Training of professional drivers, transport operators and freight forwarders should include these topics as they can save much time and money. Lack of knowledge of marketing and management, free market principles. It sometimes happens that I am visiting a road transport company and that the owner proudly shows me his brand new fleet of trucks. My first question is always: "Why are these trucks standing here and not operating on the road?" The answer is often: "We are still waiting for our clients to come". Free market principles imply the need for active marketing based on what the customer wants. This is more difficult than it seems to be and training is very badly needed in this respect. 8

9 Lack of knowledge of how to get return loads. If you do not have return loads, transport operations are becoming very expensive and you will loose your market share because of competition from other companies, which do obtain back load. An international network of business contacts and existing and potential client maybe the answer to this problem. Active marketing, use of modern technology and customer oriented services may result in such a network. Training may help in this respect. Lack of knowledge of modern logistics. Training programmes in logistics management for shippers, forwarders and transport operators are needed. The international transport sector is changing very fast. Freight transport has become much more complex than just moving goods from place A to place B. Think about all the necessary documentation; customer-oriented services in a competitive environment; just in time deliveries, value added logistics; etc. Lack of knowledge of cost calculation and relation to price setting. Calculating tariffs, costs and profits is essential for any business in a free market economy. Training in financial management at company level and management information systems may lead to better financial performances of the companies. So, there is a substantial need for training of shippers, forwarders and transport operators. And there is also a need for a harmonised approach to this training so that the client can expect a certain minimum level of quality from the side of the forwarder or transport operator. I would like to share with you now some of the experiences of harmonisation and standardisation of training of road transport operators and forwarders. Two major projects have been carried out, and I think the second one is still not completed yet, to harmonise, standardise and institutionalise training for road transport operators in the so-called Phare countries in Central and Eastern Europe and in the TRACECA countries. These projects were financed by the European Commission. I was involved in both of them. The basic objectives of these projects were: elaboration of standards for training of Road Transport Operators, transport of dangerous goods over the road (ADR), Dangerous Goods Safety Advisor, and Customs according international legislation (EU, UN/ECE); advising on national legislation regarding operator's licensing and training of road transport operators; 9

10 implementation of standards: establishment of examination structures; establishment of training centres; development of training curricula; elaboration of course materials; training of trainers. I believe the projects have been successful and brought more co-operation and integration in the trade and transport sectors in Western Europe, Central and Eastern Europe, the Caucasus and Central Asia, and, not to forget Mongolia. NEA is presently preparing a project to implement a similar project in China. Very important in these projects was the role of International Road Transport Union, and especially the IRU Academy. The IRU Academy assumed the responsibility to continue the harmonisation and standardisation efforts in road transport training by installing a system of accreditation and quality control of training institutes in road transport. They materialise the sustainability of both projects. The International Federation of Freight Forwarders Associations FIATA is assuming the same role for the forwarders as the IRU Academy is doing for the road transport operators. The Advisory Body Vocational Training of the FIATA has developed minimum standards to obtain the FIATA Diploma in Freight forwarding. Associations may submit their training materials to FIATA Headquarters for approval. Recently, new projects have been launched to improve the access to training for both transport operators and forwarders by making use of distance learning techniques. This new initiative is co-ordinated by the Worldbank and is currently being developed in Southeast Europe. The results, however, will be made available for the public on a website through the global Facilitation Partnership for Transportation and Trade (GFP) Efforts are being made to join the efforts of IRU and FIATA in this respect as both organisations share common interests. Finally, I would like to stress the need for establishing a regional training centre for logistics, forwarding and transport in the Caucasus region. I personally do have a very good experience in the process of establishing a Training Unit in Georgia as part of a larger Transport Reform and Rehabilitation Project at the Ministry of Transport. I am convinced that this Training Unit can be transformed into such a Regional Training Centre. It has all the facilities, and what is more important, it possesses a network of very highly qualified professional training experts, prepared for this difficult task. 10