Logística

Consulta de San José 2007

“Latin America: Addressing High Logistics Costs and Poor Infrastructure for Merchandise Transportation and Trade Facilitation”

Julio A. GONZALEZ, Jose Luis GUASCH, Tomas SEREBRISKY, 1

The World Bank

August 2007

1

Julio A. Gonzalez is an Infrastructure Economist, Finance, Private Sector and Infrastructure, Latin America and the Caribbean, World Bank,José Luis Guasch is Senior Regional Adviser in Regulation and Competition, Finance, Private Sector and Infrastructure, Latin America and the Caribbean, World Bank, and Economics Professor at the University of California, San Diego and Tomas Serebrisky is an Infrastructure Economist, Finance, Private Sector and Infrastructure, Latin America and the Caribbean, World Bank. The findings, interpretationsand conclusions expressed in this paper are entirely those of the authors and should not be attributes in any manner to the World Bank, its affiliated organizations, members of its Board of Executive Directors or the countries they represent. Email of corresponding author: jguasch@worldbank.org

1. Introduction
Access to basic infrastructure services – roads, electricity, water, sanitation -still remains as a key challenge in the fight against poverty in Latin America and in the elusive search for sustainable growth. These services provide not only direct and fundamental benefits but also have important indirect effects on the living conditions of the population and are key ingredients for productive development and to enhance competitiveness. Infrastructure services are central topersonal productivity and the opportunity for advancement. While this is intuitive for electricity and telecommunication services which bring with them the promise of connectivity and higher productivity, it is also true for roads and transport services. Access to markets, jobs, health care and education, the extreme poor in rural communities in Latin America live on average 5 kilometers or more fromthe nearest paved road, which is almost twice as far as non-poor rural households. Over the past 15 years, infrastructure coverage and quality have increased in most Latin American and Caribbean sectors and countries. There have been major improvements in access to water, sanitation, electricity, telecommunications, ports, and airports. Only in roads has coverage not changed much, but stillefforts and resources have been invested to improve the quality of trunk networks. This solution paper focuses on the main determinants of logistics costs and, whenever possible, provides evidence on the effects of these determinants on competitiveness and growth of Latin American economies. In preparation of the Consulta de San José 2007, this paper provides recommendations/solutions that encompass aseries of policies to reduce the prevalent high logistics costs in Latin America. The recommendations rely on the available applied economic analysis on logistics and trade facilitation (areas where very scarce studies can be found). All the recommendations were elaborated having as a main premise the feasibility of implementation; that is, all of them can be realistically implemented. Although itis difficult to do justice to the tremendous diversity of the Latin American region which is home to both Caribbean islands with fewer than 100,000 inhabitants as well as Brazil with close to 180 million, and with annual per capita income ranging from $ 467 in Haiti to more than $ 6,000 in Mexico – the recommendations emanated form this solution paper apply to most countries, though the best waysto implement them may vary. This paper is organized as follows: Section 2 provides a brief overview of the recent literature on the effects of infrastructure on productivity and growth. Section 3 presents the challenge understood as the need to reduce high logistics cost in Latin America (with its direct impact on improving competitiveness). Section 4 aims at identifying the impact of the...