Opinion

Logistics has never been so important

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We face a challenge capable of reshaping the world. As countries take essential steps to protect their populations, no sector is immune to change. Closed borders, remote working, travel bans and confinement. The coronavirus outbreak is redefining how we stay connected. And with one-fifth of the planet already isolated, it's essential that the flow of goods is maintained so that critical supplies can get to where they are needed. The global logistics industry is facing its greatest challenge. 

The outbreak of COVID-19 has increased the importance of supply chains to respond in real time and optimize the movement of goods, whether managing increased retail demand online or maintaining the supply of medical supplies and fresh produce. COVID-19 has shown that logistics needs to evolve to build more resilient supply chains. We all depend on them for food safety, health and stability, as they are tasked with keeping people safe and businesses operational, while customers adapt to new challenges.

Trade keeps the world connected. Maritime transport, where 80% of goods and 50% of oil consumed circulate, is of vital importance in global geopolitics. In addition, transport and logistics promote cooperation and development. They are blood for the economy by mobilizing $4.3 trillion. In developing countries, competitive logistics would help solve problems of immigration, radicalization or job creation. Without doubt, the economy is an essential lever in the fight against poverty, inequality, and in solving desperate socio-economic conditions.

The pandemic has made the fourth industrial revolution a reality for millions of people. The contours of a new horizon are being shaped. The digital future will create new opportunities for individuals, businesses and governments. But if mismanaged, it will also bring new threats, polarizations between divergent societies or economies. Existing economic models need new responses, as existing measures are insufficient. More economic integration, contingency plans and realistic solutions are needed to solve endemic problems. 

The magnitude of the challenge leaves the current measures as insufficient. Without an effective logistics sector, the economy cannot develop at all. Efficient logistics reduces costs in export, import and distribution in the domestic market. It is the lever for growth and competitiveness. Internationalization requires a special emphasis on the overall performance of distribution and supply networks, but also on the regionalization of sectors that benefit from geographical proximity and economic complementarity.

In addition, the industry is committed and has responded by prioritizing critical medical supplies, maintaining the flow of fresh produce and improving the use of technologies. The effort to maintain trade has been global. Governments and airport authorities around the world are implementing strict guidelines, such as increased disinfection, while also protecting the safety and health of the workforce. Workers and companies in the sector are to be thanked for their creativity, innovation and dedication to keeping the supply chain operational, agile and robust in this time of crisis.

Beyond the immediate challenge, initiatives to make trade flows more resilient are urgently needed. Building digital platforms will be crucial to adapt to this new type of crisis in the long term. The digitized supply chain, in addition to the global network of ports, terminals and economic zones, will ensure that cargo can be moved from one place to another with just one click. New technologies are boosting online logistics and enabling smarter trade, with more efficiency throughout the supply chain, greater visibility and transparency; in turn allowing the movement of goods to be optimized and redirected to where they are needed most.

This pandemic comes at a key time. The global logistics sector is booming, with increased customer service demands, the emergence of new competitors, the revision of logistics processes and their incorporation into the digital revolution. Great challenges await us, such as the use of big data to efficiently manage logistics flows or the implementation of online platforms that optimize the volumes of transported cargo.

The model of maritime powers that had been transporting cargo across the high seas for centuries is giving way to a more multidirectional and multimodal future. The map of world shipping will change. A commitment to Agenda 2030 and to sustainability is urgently needed. As 23% of CO2 emissions are attributed to transport, the common priority is to move towards greater efficiency and eco-sustainability throughout the Mediterranean region.

The Mediterranean has more than 450 ports and terminals, represents 30% of the world's maritime trade by volume and is the world's leading tourist destination. It is the meeting point of three continents (Africa, Asia and Europe), where 500 million people live. From this new situation a great platform with unique characteristics can emerge to facilitate world trade. 

However, there is a need for greater integration of infrastructure, more interconnection of the south through motorways and the promotion of multimodal corridors, such as the Mediterranean Corridor. This would change trends and benefit all components of the region. It would attract international companies, increase exports and boost job and business creation. Closing the gaps between the two shores is not easy, but achieving it would mean a more effective transport network, more trade and further development. The region has the scope and ambition to become a key player on the international logistics scene.

The future of the region depends on the ability to adapt to new realities, to build bridges, to create spaces of encounter to transform this threat into an opportunity and to turn weakness into strength. This would allow it to properly face the challenges, create a common future by adding capabilities and use this synergy in the search for new paths. It is time to act to re-position the Mediterranean as the great logistics platform in East-West flows and as the best option to canalize cargoes between Asia, Africa and Europe. Logistics has never been as important as they are today.