Speaking at the TOC Middle East Conference, Andrew Kemp, regional director EMEA for the Club, said that World Bank statistics reflected the fast-growing influence of the so-called South-South trade routes between Latin America, Africa and Asia.
Export values on this trade now representing 32% of total global trade, exceeding that between the developing and developed countries. As both an influential import/export region as well as a key hub for the movement of goods in the South-South trade, the Middle East and its transport operators, are experiencing significant growth opportunities.
In conjunction with this growth has come a dynamic change in the amount and variety of services freight forwarders, logistics service providers and other transport companies are offering shippers. However, this trend is not limited to operators in the Middle East but is being experienced across the globe, said Kemp.
Such new trade growth has meant demands on forwarders and other logistics operators are changing rapidly from the traditional organisation of international movement of goods.
Manufacturers, retailers and other shippers are increasingly requiring the provision of additional logistics services such as warehousing, sub-assembly and packing, with tight margins for error and sometimes harsh financial penalties for breakdowns in their supply chains.
Kemp highlighted, “As a consequence of providing these additional services, whether sub-contracted or provided within their own operation, forwarders are typically accepting extended contractual exposure, in terms not only of the period during which customer’s goods are in their custody, but also usually more onerous terms and conditions”.
“Simply put, the more complex the services undertaken, the greater are the chances of errors and omissions occurring. Awareness of the extent of the possible risks is essential for the modern day forwarder and logistics operator to assimilate, particularly when involved in the rapidly developing Middle East hub,” he said.