Shipping containers at the Port of Mombasa
Shipping containers at the Port of Mombasa

 

South Africa, India, and Indonesia have joined the World Logistics Passport. They join Colombia, Senegal, Kazakhstan, Brazil, Uruguay, and the UAE in a club of trading nations sharing expertise to smooth trade flows around the world.

The World Logistics Passport (WLP) is a policy initiative established to increase trading opportunities between emerging markets.

The WLP creates opportunities for business across Africa, Asia, Central, and South America to improve existing trading routes and develop new ones, through the world’s first logistics loyalty program for freight forwarders and traders. 

It overcomes non-tariff trade barriers by fast-tracking cargo movement, reducing administrative costs, advancing cargo information, and facilitating movement between ports and air. 

A prime example of the benefits of the program is the cargo journey from Jakarta to Johannesburg. Transporting high-value, low-weight goods through historically established transport routes in Europe takes considerably longer, and is, therefore, more expensive, than if the goods pass through Dubai. Through the WLP, traders can expect to save 25% on freight costs and 10% on transit time moving goods from Indonesia to South Africa.

The benefits are aimed at local and foreign producers. Specifically, the WLP process involves working with partners to identify pain points in the trade and logistics journey and then finding and implementing benefits to fix them. Local manufacturers and businesses will be able to benefit from quicker processes, less documentation, and reduced costs when exporting from the country.

Crane unloading container on truck at Jebel Ali Terminal

The WLP has a proven track record. In Dubai, 12 local providers have confirmed more than 50 benefits which have in turn been applied to over 300 traders, accounting for approximately 50% of the Emirate’s trade. 

Mike Bhaskaran, CEO of the WLP said: “The World Logistics Passport increases resilience in global supply chains and removes the barriers that prevent developing economies from trading as freely as they might, which is more important than ever as governments around the world seek to recover from the economic impact of COVID-19.”

“Today’s announcement shows that governments and businesses are thinking differently about how goods and services move around the world, and we are delighted to welcome India, Indonesia, and South Africa to the club,” he added.

Improving trade is a priority for South Africa and the subcontinent as a whole in order to boost job creation and support export-led growth.

The Johannesburg Chamber of Commerce signed a framework agreement with the WLP . Joining the WLP will be a key enabler of the African Continental Free Trade Agreement, and will open up new market potential among countries in the region.

“We are very excited about joining the World Logistics Passport global network as a partner and benefits provider. We believe that South African traders and freight forwarders will greatly benefit from this global incentives program to boost south-south trade,” said Jackie Mpondo-Hendricks, President, Johannesburg Chamber of Commerce.

South Africa has joined the WLP at a time when the country, and broader region, seek to recover from the economic impact of COVID-19. The WLP program is closely aligned with South Africa’s National Development Plan 2030, which aims to increase intra-regional trade and improve trade penetration into fast-growing markets in Asia and Latin America.

 In addition, the WLP is working on increasing routing options to South Africa, opening up a diversified range of export markets to promote trade penetration in fast-growing economies.

India is the largest economy to join the WLP to date. The WLP now counts Mumbai International Airport (Chhatrapati Shivaji Maharaj International Airport), Nhava Sheva International Container Terminal (Mumbai), and Emirates SkyCargo in India & Nepal as partners.

As a trade enhancing policy initiative, the WLP is closely aligned with the Strategy for [email protected] in its aims to boost national competitiveness, increase the efficiency of India’s logistics sector and build tighter economic integration with emerging economies in South and Southeast Asia.

The WLP now looks forward to welcoming the participation of the Ministry of Commerce & Industry to represent the government’s oversight of local operations, and the CBIC (Customs) as a partner, as well as other regional organizations.

Indonesia, the first South-East Asian nation to join, is a strategically important market for the WLP, as it represents a region key to the WLP concept for its fast economic growth driven by manufacturing exports. 

The WLP will complement and reinforce the headline aims of the final stage of the Long-Term National Development Plan (RPJPN), specifically in terms of boosting national competitiveness and higher-wage job creation across all of Indonesia’s varied geographies.

The WLP now counts the Indonesia National Shippers’ Council as a partner, which will provide benefits related to navigating the local market. Last year, the Indonesia National Shippers’ Council signed a Memorandum of Understanding with PCFC in Dubai to realize trade cooperation, thus the registration can be seen as an evolution of an already entrenched and fruitful partnership.

 

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