The list of attributes given in the preceding section suggests that when considering the advantages offered by inland logistics ports, we need to look at both functional and locational advantages. The existence of an inland logistics port provides shippers with a direct interface to international transport and therefore gives them a locational advantage. It also provides them with access to a number of functions that can be undertaken at the inland logistics port, some of which are traditionally restricted to international ports or border-crossing points (e.g.
customs clearance.) Most of the advantages described below directly relate to shippers.
However, if shippers perceive advantages in the existence of an inland logistics port, then it also provides business opportunities for the logistics sector and for the local economy in general. Typical advantages of inland logistics ports are:
Inexperienced inland-based shippers have the opportunity to undertake international trade through local facilities;
International functions such as customs clearance and labelling for export can be undertaken locally (Walter and Poist, 2003);
Uncertainties of customs clearance can be eliminated through the locational advantage of having all associated functions at one site (e.g. unloading, modal transfer, redistribution) (Leitner and Harrison (2001);
Smaller shippers can benefit from consolidation of their consignments with others to form full loads;
Inland-based shippers have direct access to international transport equipment such as containers or roll-on/roll-off vehicles;
Inland-based domestic-only shippers have access to a wider range of local resources (Walter and Poist, 2003);
“Transportation-related waste” associated with inefficient supply chains can be eliminated or at least reduced. This is achieved primarily through better linkage between different modes (e.g. intermodal rail facilities) or within modes (e.g.
connections between different major road routes) (Leitner and Harrison 2001; Morash, 1999, in Leitner and Harrison); and
Collaboration is possible between different institutions undertaking such functions as distribution, warehousing, and manufacturing, providing a “shared location for partners” (Robinson, cited in Leitner and Harrison 2001). In other words, this is a benefit of clustering.
A comprehensive analysis of the advantages of dry ports requires a balance check between transport externalities, which can be benefits and costs. Rothengatter (1994) presents a number of external transport benefits (specifically referring to road transport). Those particularly relevant to inland logistics ports include:
Extension of the consumption pattern and improvement of living standards;
Introduction of growth and structural effects, and freight logistics to create new approaches to industrial labour division and interaction, setting new quality standards such as “just-in-time” transport;
Increase in flexibility and innovation, which creates a new quality of service and transport and strengthens the economy for international competition;
Cost reductions for packing, processing, and logistics; and
Positive employment effects in peripheral regions.
4.4.2 Constituents of a good dry port
A number of key features contribute to the operation of an effective inland logistics port.
They include:
Location at or near a rail-based intermodal terminal. Many centres have access only for road transport, either because of a strong road-orientation within an industry or economy, or because of mediocre service by rail. With the growth of legislation or taxation against road congestion, the appeal of intermodal centres should increase (Konings, 1996);
Access to sea and/or airports;
A high quality transport system, preferably consisting of all three modes – rail, road and airway. Leitner and Harrison (2001) consider that good transportation is the key determining element for a successful inland port. They suggest that such a facility has a “development life cycle” where first transport is introduced, followed by distribution facilities, and finally manufacturing facilities. Examples of good practice include air cargo capacity, intermodal facilities, and easy access to the road system (Walter and Poist, 2003);
Advanced technology in information-sharing such as EDI. This allows international trade to operate at locations other than the traditional international boundaries enabling seamless movement of goods door-to-door. An information centre with transport and trade publications and statistics can also be offered, perhaps in association with a website (Leitner and Harrison, 2001; Walter and Poist, 2003);
Ability to meet the needs of a specific marketplace by integrating services with the physical infrastructure (Roso and others, 2006) and with potential users who have existing traffic (Leitner and Harrison, 2001);
Sufficiently large local population as a market and/or labour pool. A minimum base population of three million people has been estimated to be needed for an inland port (Leitner and Harrison, 2001);
Sufficiently large area of land for development, estimated at 5,000 to 10,000 acres (approximately 2025 to 4050 hectares) (Leitner and Harrison, 2001);
A full range of services appropriate to an inland logistics port. These include all modes of transport, transloading (between international and domestic transport), warehousing (included bonded warehouse to offer postponement of tax payment), distribution, consolidation, container services (empty storage, maintenance and repair), customs clearance, other logistics services, and manufacturing. (Leitner and Harrison, 2001;
Roso and others, 2006; Tioga Group, 2003);
A free trade zone to provide a tariff shelter (ESCAP, 2005; Walter and Poist, 2003);
Security and control using modern information and communication systems (Roso and others, 2006);
Proximity to substantial manufacturing capacity and production centres or to large shippers;
Effective cooperation between public and private organizations, possibly through councils formed to address the problems of interested parties such as shippers and logistics providers (Walter and Poist, 2003);
A multipurpose business centre for offices, conferences, trade shows etc (Walter and Poist, 2003); and
An inland logistics port can have a positive impact on the regional or local economy, not only by providing direct processing of international trade, but also by attracting distributors and manufacturers associated with it. This is another advantage of clustering.
4.4.3 Critical issues for the effective development of dry ports
The development of dry ports requires attention to several critical issues that influence the development of dry ports.
Disagreement between shippers and carriers or other logistics companies about the nature of the facilities (Walter and Poist, 2003).
Government involvement may not be at the appropriate level. In many countries inland logistics centres or nodes are not public assets under the responsibility of Government, unlike rail transport systems, road infrastructure and international ports.
Often the development of inland logistics centres rests entirely with the private sector.
For example, Rosso and others (2006) point out how the European Union has established the major links in the Trans-European Network (TEN) for intermodal transport, but offers no guidelines on the location or the functions of the nodes of the network. The focus on links rather than nodes is typical of many Government s and is reflected in the composition of ministries, which are generally associated with specific transport modes (e.g. Air Ministry) rather than with intermodalism or logistics as an integrated service (OECD, 2001).
Development creates its own congestion through the growth of road transport activity, which in turn may reduce accessibility to the facility (Konings, 1996).
Similarly to the argument about the external benefits of transport in general and dry ports in particular, the external costs need to be evaluated. External transport costs have two major impacts: on the stock of non-renewable natural resources; and through interactions within the transport system3. External benefits of transport would, ideally, compensate for the external costs. However, they may also be seen as internal benefits to the transport operator resulting from lower transport costs or greater efficiency. Therefore, it could be argued that they do not compensate for the external costs of transport. The external costs of transport are many and varied and may be considered in both global and local terms. The local aspects of external costs of transport may be divided into the following:
The environment (pollution and noise) ;
The infrastructure (vibration and road wear); and
Social considerations (safety, congestion, intrusion and community severance).
The discussion of advantages, constituents and critical issues related to dry ports shows that effective development of efficient dry ports has significant legal implications, which will be discussed in the next subchapter.
4.5 Legal implications of dry ports