INSIGHTS
- Logistics performance worldwide proved broadly resilient after three years of unprecedented supply chain disruptions during the COVID-19 pandemic, according to the World Bank’s latest logistics performance index.
- Singapore and Finland led with scores of 4.3 and 4.2 on a 5-point scale respectively.
- India and South Africa significantly improved their scores.
Logistics performance worldwide proved broadly resilient after three years of unprecedented supply chain disruptions during the COVID-19 pandemic, according to the World Bank’s latest logistics performance index (LPI).
Top-rated countries–all high-income–maintained a high calibre of services, while the weakest performers were not rated any worse.
Advanced economies took the top spots, with Singapore and Finland in the lead with scores of 4.3 and 4.2 on a 5-point scale respectively. Promisingly, large emerging economies such as India and South Africa significantly improved their scores, as did mid-level performers.
Many more countries are now clustered around a score of 3.5, several of them being middle-income countries in two regions—Europe and Central Asia as well as the Middle East and North Africa, World Bank senior economist Christina Wiederer wrote in a blog on the organisation’s website.
Supply chain reliability is at the core of logistics performance. The LPI measures the ease of establishing reliable supply chain connections and the structural factors that make that possible, such as the quality of logistics services, trade- and transport-related infrastructure, and border controls.
The survey is typically conducted every two years but was delayed for more than two years due to the COVID-19 pandemic.
Broad-based strength helped some developing countries outperform wealthier ones—China and South Africa did better than the United Kingdom, for example; Malaysia outperformed New Zealand, Wiederer noted.
Viewed across all six LPI components, the ‘timeliness of shipments’ component tends to see the highest scores in most countries (except the ones at the top), whereas the performance of customs and border agencies shows the lowest scores in most countries. The lowest ranking countries also tend to be low income, isolated, landlocked, or beset by conflict.
For landlocked countries, addressing bottlenecks requires coordinated interventions across borders, such as transit regimes similar to Europe’s Transports Internationaux Routiers (TIR).
Small island states need more reliable connections and a greater choice of competitively priced trans-shipment hubs.
The index also showed that the highest demand for green logistics options is in countries with the best logistics performance.
Digitalising supply chain processes can pose challenges for low- and middle-income countries, where basic infrastructure like electricity can be unreliable, she added.
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