Wednesday, November 20, 2013

Colombian transportation services from the UNCTAD’s perception

By: Carolina Herrrera Cano* (
International Business student, Universidad EAFIT, Colombia

Nowadays, the different services related with the transport industry like: operation, administration, licensing, insurances, financing, and recycling, are also related with certain economies in which those activities are more competitive. For instance, developed countries usually undertake activities like insurance, and financing that generate more value added. UNCTAD works together with governments in the process of increasing trade in global economy.

Dr. Vincent F. Valentine Officer-in-Charge, Transport Section Trade Logistics Branch at UNCTAD describes the current conditions of the transportation services in the world. Dr. Valentine emphasizes some principles of the global transportation services that could be implemented in Colombia in order to increase competitiveness in this sector, and to take advantages of the current regional integration processes.

Surprisingly, after asking about infrastructure problems that the country faces today, Dr. Valentine argues that “actually infrastructure should not become such an important effort in governmental agendas, it is currently more crucial to have availability of efficient customs, consolidation process (at ports), administration procedures”. Dr. Valentine calls these “soft practices”, which are activities in which countries should specialize if they want to be attractive for international trade. In this sense, the impossibility to maintain investment flows in the country through the years makes this option dangerous for the economies: countries should not depend on this capital injections, but they should increase efficiency by creating a qualified labor force that works both inside, and outside of the ports: transportation is a service that must involve complementary activities from different areas.

For the case of Latin American countries, Professor Vincent Valentine suggests the use of any of the following patterns: (i) to be efficient in the traditional import-export model; (ii) to work as a logistics center for certain industries, and (iii) to serve as a “transshipment” port (acting as intermediaries, and working in a parallel way with import-export ports). In this third model, Mr. Valentine suggests that countries with few opportunities to compete with countries with high development in transportation services (such as Colombia, being next to Panama) could act as a hub for the rest of the region. This is how Colombia should increase its efforts to improve its “soft” practices, and to take advantages of regional integration in order to represent an attractive destination for international trade.

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