Scholarly article on topic 'A Comparative Assessment of Freight Transport and Logistics Policies in Europe'

A Comparative Assessment of Freight Transport and Logistics Policies in Europe Academic research paper on "Economics and business"

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Abstract of research paper on Economics and business, author of scientific article — Konstantinos G. Zografos, Norbert Sedlacek, Jeroen Bozuwa

Abstract The objective of this paper is to provide a comparison between EU and National (Member States) freight transport policies. Emphasis is given to policies aiming to increase co-modality and promote the sustainability of the European Freight Transport System. The results suggest that the intended Member States’ policies to a great extent are aligned with the corresponding EU policies although the degree of alignment varies among Member States and freight transport policy areas. Infrastructure investments and differences among countries in relation to transport taxes, vehicle weights, and dimensions were identified as major barriers for the development of a European Co-Modal Freight Transport System. Policies towards removing existing barriers along with standardization actions, e.g., single transport document, enhancement of the training of the freight transport and logistics personnel, and further adoption and implementation of ICT, can substantially improve the competitive position of European intermodal freight systems.

Academic research paper on topic "A Comparative Assessment of Freight Transport and Logistics Policies in Europe"

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Procedia - Social and Behavioral Sciences 48 (2012) 2523 - 2532

Transport Research Arena - Europe 2012

A comparative assessment of freight transport and logistics

policies in Europe

Konstantinos G. Zografosa'*9 Norbert Sedlacekb9 Jeroen Bozuwac

aTransportation Systems and Logistics (TRANSLOG) Laboratory, Athens University of Economics and Business, Evelpidon 47A&

Lefkados 33, Athens 11362, Greece bHERRY Consult GmbH, Argentinierstrasse 21, A-1040 Wien,Austria cECORYS, Watermanweg 44, 3067GG Rotterdam, The Netherlands

Abstract

The objective of this paper is to provide a comparison between EU and National (Member States) freight transport policies. Emphasis is given to policies aiming to increase co-modality and promote the sustainability of the European Freight Transport System. The results suggest that the intended Member States' policies to a great extent are aligned with the corresponding EU policies although the degree of alignment varies among Member States and freight transport policy areas. Infrastructure investments and differences among countries in relation to transport taxes, vehicle weights, and dimensions were identified as major barriers for the development of a European Co-Modal Freight Transport System. Policies towards removing existing barriers along with standardization actions, e.g., single transport document, enhancement of the training of the freight transport and logistics personnel, and further adoption and implementation of ICT, can substantially improve the competitive position of European intermodal freight systems.

©22012 Published byElsevier Ltd. Selection and/or peer review under responsibility of the Programme Committee of the T ransport Research Arena 2012

Keywords: Freight Transport Policy; Policy Assessment.

* Corresponding author. Tel.: +30 210 8203673-5; fax: +30 210 8203684. E-mail address', kostas.zografos@aueb.gr.

1877-0428 © 2012 Published by Elsevier Ltd. Selection and/or peer review under responsibility of the Programme Committee of the Transport Research Arena 2012

doi:10.1016/j.sbspro.2012.06.1223

1. Introduction

Freight transportation is vital for the effective and efficient production and distribution of goods. The development and operation of the freight transport system generates externalities that jeopardize its sustainability. Co-modality is considered by the European Transport Policy (European Commission, 2006a) as a means for improving the sustainability of the European Transport System. The European Commission and the European Union Member States have introduced freight transport and logistics policies aiming to enhance the sustainability of the freight transport system. The introduction and implementation of EU policies may vary among Member States due to differences in their policy making structures (Zografos and Tsanos, 2007). Differences in policy making structures can be attributed to different degrees of: i) centralization (Rietveld and Stough, 2004), ii) interest group influence (Webb Yackee, 2005), and iii) regulatory intervention (Haynes et al., 2005). Thus, in some instances, Member State policies may not be completely aligned with the European Policy requirements. Furthermore, the intended and actual policy outcomes may also present differences, while at the same time institutional, organizational, technological, and human resources related barriers may inhibit or enable the achievement of the intended policy outcomes.

The objective of this paper is to provide a comparison between the EU and the national (Member States) freight transport and logistics policies. The work reported herein covers twelve EU Member States plus Switzerland and was carried out within the framework of the EC funded project BE LOGIC. Emphasis is given to policies aiming to increase the connectivity of the various transport modes and promote the sustainability of the European Freight Transport System.

The remainder of this paper is organized into four sections. Section two presents the methodology used to compare EU and EU Member States freight transport policies. Section three identifies the categories of EU outcomes and summarizes the results of the analysis relevant to the coherence of the EU and Member States freight transport policy. Section four presents existing transport policy areas and identifies the advantages / disadvantages caused by the implemented policies for combined transport solutions. Section five summarizes the results of the research and identifies the barriers for the achievement of the policy objectives and provides recommendations to overcome the identified barriers.

2. Methodology

The methodological framework used for the comparative assessment of freight transport and logistics policies in Europe consists of three steps (Figure 1). The first step involved the identification of all relevant transport policy documents from EU and the Member States, as well as the development of a "document summary sheet" which was used to present in a uniform way the information extracted from the reviewed policy documents. The result of this step was the identification of the intended policy outcomes of EU and of the participating EU Member States regarding logistics and co-modality. The objective of the second step was to compare the identified intended policy outcomes of EU with those of Member States and between Member States. A template linking Member State and EU intended policy outcomes was developed. The linkage of the intended outcomes was based on the following four categories of relationships: i) conformance, ii) reflection, iii) contradiction, and iv) no linkage at all. The outcome of this step was an assessment of how the EU intended policy outcomes relevant to logistics and co-modality are aligned with the corresponding intended policy outcomes of the Member States. Finally, the third step of the methodology analyzed studies and existing policy outcomes relevant to modal split

and value added of the transport sector. The result of this step was the assessment of the alignment of existing policy outcomes of EU and Member States.

Identification of intended policy outcomes regarding logistics and co-modality Selected EU Member States (MS)

Template: "policy outcome linkage" to compare identified intended policy outcomes in EU with MS and between MS

Linkage, comparison and conflicts of intended policy outcomes EU/MS

Comparison and conflicts of existing policy outcomes EU/MS

Fig. 1. Methodological Framework

The following Key Performance Indicators (KPI) were used in order to perform the comparative assessment:

D Overall transport policy and planning

■ Stakeholder integration

■ Regional responsibilities

■ Status of transport modes

■Existence and status of transport (master) plans, modal split plans, CT-plans, security and safety plans D Rail liberalisation

■ Separation of function

■ Market access

■ Safety

° Infrastructure pricing (per mode)

■ Pricing level

■ Type of pricing

■ Network coverage ° Legislation

■ Bans and regulations

■ Accessibility

■ Priority and train path allocation to rail freight and CT ° Governmental aids

■ Monetary aids (existence and amount of funding schemes)

■ Infrastructure access (limitations, capacity, future development) ° Taxes (per mode)

■ Tax level

■ Type of taxes

° General performance indicators

■ Transport (performance per mode, share of CT)

■ Social (air pollution, green house gas, accidents per mode)

■ Economic (policy caused transport costs, value added of the transport sector)

3. Identification of Intended Policy Outcomes

The analysis of the identified policy documents (BE LOGIC, 2010) led to the following set of relevant intended outcomes of the EU policy regarding logistics and co-modality. These outcomes were grouped into the following major policy impact areas: ° Competition

■ Improvement of market access rules

■ Strategy for a common European maritime space

■ Reduction of differences of transport related taxes

■ Use based charging

■ Freight oriented rail network (priority to freight trains on corridors)

■ Frame for fair competition between ports ° Linkage of modes

■ Promotion of short sea shipping, motor of the sea and their landward connections

■ Simplification and facilitation of freight transport chains and related administrative procedures (including a single European transport document and paper free electronic flow of information)

■ Integration of waterborne modes in the transport chains

■ Improvement of the quality of logistic services

■ Standards for loading units useable for all modes

■ Enlarging the capacities of ports and terminals ° Efficiency

■ Promotion of innovative technologies regarding infrastructure and means of transport

■ Freight logistics personnel and training

■ Improvement of efficiency of all modes

■ Use of co-modality

■ Corridor-based approach by exploiting economies of scales

■ Review of existing limitations to road vehicle weights and dimensions

■ Reduction of infrastructure and technical caused limits to rail freight transport (weight, length, implementation of ERTMS etc.)

■ Standards and legal framework for the use of ICT in freight transport

■ Use ICT and cooperative ITS systems (vehicle to vehicle; vehicle to infrastructure; infrastructure to infrastructure) and in freight

° Safety and Security, Social and Environmental

■ Common (extended) security rules to critical (inter-modal) infrastructure

■ Further Research, demonstration and market introduction of new technologies (optimisation of engines, alternative fuels, vehicle energy management systems, Human Machine Interface etc.)

■ Green transport corridors for freight

■ Reduction of emissions of all modes including ports and terminals

■ Promotion of energy efficiency of all modes

■ Intelligent mobility systems (eSafety, ERTMS, RIS)

■ Review of existing rules on working conditions for road haulage

■ Improvement of the dialogue between social partner (across borders)

3.1. Coherence of Policylntentions

The identified intended outcomes of EU policy were used in order to assess the coherence between EU and Member States logistics and freight transport policies. The identified intended EU policy outcomes can only be achieved if the policies of the Member States offer framework conditions that support these European policy intentions. Therefore, the identified transport logistics policy objectives of the selected countries (BE LOGIC, 2008) were linked to the European policy objectives. This was done on a per country basis by checking the conformity of the policy objectives of a given country with the corresponding European policy objectives relevant to competition, co-modality (linkage of modes), transport efficiency, safety and security, social and environmental aspects of the transport system. The results of this analysis are summarized in Table 1. The numbers in the cells of Table 1 indicate the number of intended policy outcomes that confirm (V), reflect (■), or contradict (x) the corresponding EU policy objective for each country identified by the rows of the table. The last row of the table (sum) indicates the total (over all countries) intended policy objectives that confirm, reflect, or contradict EU policies. For instance, according to the results summarized in Table 1 regarding the intended policy outcome linkage of modes, out of the 420 intended policy objectives of all countries 246 of them are in full confirmation with the corresponding EU policy intentions, while 174 reflect to a significant extent the EU policy intentions.

In general, Member States' national transport policy intentions are aligned with EU policy intentions. Most of the European policy objectives are reflected in a more or less similar way in Member States' policy documents on freight transport and logistics. For eight out of twenty-nine identified European policy intentions (namely, Improvement of market access rules, Reduction of differences of transport related taxes, Improvement of efficiency of all modes, Use of co-modality, Review of existing limitations to road vehicle weights and dimensions, Further Research, demonstration and market introduction of new technologies, Green transport corridors for freight), (a small number of) Member State policy intentions were found to be in contradiction with the corresponding EU policy intentions.

The European policy is balanced between the main policy topics: competition, linkage of modes,

efficiency, safety and security, social and environmental aspects. All topics have rather the same importance within the European policy. This, however, does not apply for the Member States. The national policy documents that have been analyzed are more focused on two of these four topics: linkage of modes and efficiency. The other topics seem to have less importance within the national policies of Member States. On the level of the individual Member States, this may differ of course. Most of the countries' policies have a rather low focus on competition (especially between countries). This is typical within the transport sector (but also other sectors) and is still valid especially for rail. Policy to improve competition is believed to be only implemented if forced by EU rules.

The topic that seems to be the most important within most of the Member States' national transport policies is efficiency. This topic is clearly the most important policy topic for the Member States.

Table 1. Conformity with EU policy intentions

Country Policy Area

Competition Linkage Efficiency Social

V ■ X V ■ X V ■ X V ■ X

AT 4 4 1 9 11 0 11 12 3 15 10 0

CH 4 2 1 2 3 0 11 9 2 10 4 0

CZ 0 2 0 6 5 0 4 10 0 5 3 0

DE 25 0 0 91 6 0 130 2 0 49 7 0

ES 8 12 0 3 13 0 7 11 0 2 4 0

GB 7 5 0 10 12 0 8 16 0 12 14 0

GR 15 7 0 39 25 0 45 22 0 30 16 0

IT 1 8 0 6 14 0 11 12 2 8 10 1

LT 4 18 0 32 19 0 37 23 0 19 17 0

LV 7 15 0 7 19 0 4 28 0 0 15 0

NL 7 2 0 4 5 0 8 3 0 1 3 0

PL 6 6 0 8 8 0 9 14 1 3 5 1

RO 1 4 2 29 34 0 7 10 8 12 2 0

sum 89 85 4 246 174 0 292 172 16 166 110 2

The European policy intentions which seem to have the highest number of Member States policy intentions that could be regarded as supportive to the European policy intentions, are:

° Integration of waterborne modes in the transport chains ° Improvement of the quality of logistic services ° Improvement of efficiency of all modes ° Use of co-modality

4. Summary of Existing Policies Regarding Combined Transport Solutions

The effect of existing transport policies on co-modal transport solutions was analyzed for a wide spectrum of policy initiatives classified into four major policy areas: i) infrastructure pricing, ii) combined transport related legislation, iii) governmental aids, and iv) taxation. In addition, general issues of transport policy affecting the development of co-modal freight transport solutions were also analyzed. The assessment (summarized in Table 2) was based on a four-point scale indicating the degree and direction of the various policies in facilitating the development of co-modal solutions (e.g., substantial positive ++, positive +, substantial negative --, negative -).

Konstantinos G. Zografos et al. /Procedia - Social and Behavioral Sciences 48 (2012) 2523 - 2532 Table 2. Effect of transport policies on Co-Modal Solutions

Advantages and Disadvantages of policies for combined transport solutions

AT CH CZ DE ES GB GR IT LT LV NL PL RO

o Importance of CT within policy ++ ++ ++ ++ - ++ + ++ -

CL t Existing MS-plans

a. CO Existing CT-plans

H Rail freight priority (existing or planned) + ++ + ++ + +

specific CT-Tariffs road +

H .!= specific CT-Tariffs rail + + + + +

1 '£. specific CT-Tariffs iww +

c specific CT-Tariffs sss

Legislation CT-exceptions regarding driving bans + + +

higher gross vehicle weight for CT-haulage + + + + + +

funding ofinvestments + + + + + + + + +

funding ofoperation + + + + + +

funding ofmodal shift actions + + + + + +

funding of traffic avoidance actions + + + +

funding ofcommon learning actions + +

to TD funding ofC02-reduction actions + + + +

funding ofCT-transport performance + + +

CD E funding based on other items + + + + +

(D max funding in % of eligible costs + + ++ ++ + + ++

Ö funding in % of GDP + + ++ ++

network limitations - - - +

future rail infrastruture development (% of GDP) + + + + +

number of CT-terminals + ++ + ++ ++ + ++

number of ports + + + + + +

future terminal and port investments (% of GDP) + + ++ + +

Tax specific tax lavels for CT + + +

Table 2 summarizes the results of the analysis of the effect of transport policy on the development of co-modal solutions. Combined Transport (CT) is of rather (high) importance within the transport policy of the following seven countries (as indicated by the ++ / + for these countries in the top row of Table 2): AT, CH, DE, GR, LT, LV and PL. This is however not always sustained by the actual transport policy plans implemented (i.e. AT, where actual transport policy plans on modal shift or combined transport are lacking). On the other hand, for a country like Italy, the importance of combined transport policy is rather low compared to other countries, whereas the actual implementation of plans seems proof of the opposite. However, in addition to this, other governmental aids like infrastructure investments exist. Some countries favour pre- and end haulage of CT solutions by legal exceptions from driving bans and regarding the gross vehicle weight. Especially regarding pricing and taxes only in a few countries (AT, CZ, DE, GR) exceptions exist for combined transport solutions. Nevertheless, the CT-solution receives money via funding schemes in almost all countries.

Comparing the different countries according to the impacts of their existing policy actions in terms of facilitating co-modal solutions, the following countries seem to provide the most friendly policy environment for combined transport: Austria, Great Britain, Switzerland, Poland, and the Netherlands. Countries which seem to offer less CT-friendly policy environments regarding combined transport, are

Spain, Italy, Latvia, and Lithuania. 5. Policy Effects

An overview of the logistics and freight transport policies of EU and thirteen European countries (12 Member Stated and Switzerland) was performed in order to identify the degree of alignment of EU and Member States intended and existing policies. In the course of the analysis, barriers to the alignment of policy objectives were identified. The identification and alleviation of these barriers constitute a major prerequisite for achieving the policy goals. In this section, we discuss the identified barriers and we provide recommendations for alleviating them.

5.1. Results

5.1.1. Infrastructure investments remains a barrier for intermodal transport

Because of budget restrains, prioritization of the investments in the European intermodal network is crucial and has become even more important with the economic crisis and scarcity of financial means. So, budget restrains in itself is an important barrier which hinders the development of suitable port infrastructure and hinterland connections by rail and inland waterways (including terminals for transhipment) as an alternative for road transport. With infrastructure budget under pressure, European coordination on infrastructure development becomes more important. However, the coordination among European stakeholders is lacking due to the following issues:

° There is no binding allocation of financial means for the development of (port) infrastructure, which causes planning uncertainties for ports, which in turn may lead to sub-optimal development of ports in Europe.

° Prioritization of freight at the cost of passenger transport by rail is not always at the interest of national and local politicians.

° In some countries, only a limited number of public funds are allocated to the development of transport terminals, as the focus is still too much on improving connecting infrastructure (i.e. missing links).

° In countries where waterborne transport plays a less prominent role, the political urgency to integrate waterborne transport in transport chains is lacking.

° Experiences with alternative funding through Public Private Partnership is lacking in many countries.

° With coordination lacking and budget restrains remaining or even increasing, there is a risk that the development of green corridors for freight transport (which need high investments) gets less priority.

5.1.2. Differences between countries (i.e. transport related taxes, vehicle weights and dimensions) hinder a levelplayingfield

Taxes are still mainly fixed at the national level. Only specific maximum and minimum levels are fixed with directives and regulations at a European level but no concrete tax level harmonization exists. The introduction of a real tax harmonisation can only be achieved if Member States agree upon such a harmonisation.

The existing Euro-vignette-directive (European Commission, 1999), amended in 2006 (European Commission, 2006b), enables but does not force the implementation of use based charging. The internalization of external costs within toll tariffs on EU level is a further step towards the establishment of a level playing field in the area of freight transport. However, transport associations may lobby for their

own specific agenda which is not always in the interest of fair competition both within a Member State and between Member States.

The current discussion regarding a possible introduction of larger and heavier trucks may lead to contradictory actions taken by the Member States and even by regional authorities within certain countries. Although national differences have to be taken into account, this should not lead to different rules governing the use of such trucks, as this may create uncertainty among transport operators.

5.1.3. Low interest in improving the quality of services through training and education

In the freight transport and logistics sector, which is dominated by small and medium sized enterprises, the typical behaviour is "we do it as we always did". Moreover, small transport companies and one-person-enterprises (owner-driver) in particular, often do not have time and budget resources for training and education. This may hinder efficiency improvements and effectiveness of measures aiming to improve the performance of the sector in general and intermodal transport in particular. Furthermore, the structure of the freight transport system may pose problems relevant to the adoption of new technologies and innovations which can significantly improve the level of quality of transport services. The economic downturn may even worsen this situation, as new technologies may require substantial investments. Companies may therefore consider using their budget for improving existing transport solutions instead of implementing completely new transport solutions and technologies.

5.2. Recommendations

Based on the main barriers identified, the following general recommendations can be made:

° The EC should invest in infrastructure, particularly in rail infrastructure, intermodal terminals and ports. This also applies to the continuation of the Rail Freight Corridors and Green Corridors. Given the limited resources, it is important that priorities are set at European level and that there is a commitment of resources for these priorities. Progress should be monitored closely. Cost Benefit Analysis could be used to assist in the prioritization, and the EC should have an open eye towards Public Private Partnership to attract other sources of financing.

° The EC should remove differences between countries. This especially applies for a harmonization of transport related taxes. The same applies for uniform safety and security measures for freight vehicles/vessels/trains across Europe. The rail market should be truly liberalised in all EU countries.

° Training and education in the logistics sector should be a major point of attention. The sector should aim for a minimum level of quality, in order to guarantee a minimum level of services. Special attention should be paid to four aspects:

■ New technologies: the sector should not only be able to work with the new technologies, but higher level employees should also have a basic understanding of IT and be able to express their needs and requirements in a way that it is understood by the IT industry.

■ New methods of working: The transport sector is changing quickly, influenced by globalisation, IT developments, environmental concern, etc. These aspects should be included in the training and education of students and existing personnel.

■ Best practices could be a good way of demonstrating in practice how these new technologies and methods can be applied.

■ Specific requirements of the CT-sector have to be part of the transport logistic education. This has two positive effects: the next generation of personnel in the logistic sector is aware of the

possibilities of CT-solutions and is able to take this transport possibility into consideration when making transport decisions and the growing CT sector is able to recruit adequate personnel.

° In order to have a fair competition within and between modes, harmonisation of taxes and internalisation of costs is a prerequisite. By applying objective criteria, a fair pricing system can be established, taking into account external effects, in which neither specific modes, nor specific countries get a preferential treatment.

° Last but not least, the EC should emphasise the importance of Intelligent Transport Systems (ITS) and act accordingly. ITS in the form of the Single Window concept can be a very effective way to reduce bureaucracy and improve efficiency. In addition, standardization of information exchange between transport modes, such as the Single Transport Document, Intermodal Route Planner and Tracking & Tracing, can significantly improve the competitive position of intermodal transport compared to unimodal transport. In rail, the further implementation of the European Rail Traffic Management System (ERTMS) is essential.

Acknowledgements

The work reported in this paper has been supported by the BE LOGIC project funded by the European Commission (DG MOVE).

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