Press Release: Dialogue about the Costs of Congestion in Logistics Chains in Latin American and Caribbean Cities

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Identifying how traffic congestion in Latin American cities impacts the final price of products and services: That is the goal of a study being led by the Transport Division of the Inter-American Development Bank (IDB), entitled “Methodology to Analyze and Quantify the Impacts of Congestion on Logistics Chains in Latin American and Caribbean Cities.” The project, which is being coordinated by Transport Specialist Pablo Guerrero, counts among its contributors José Holguín-Veras, Principal Investigator from the Rensselaer Polytechnic Institute (RPI) and Director of the VREF Center of Excellence for Sustainable Urban Freight Systems.

As part of the process of establishing a methodology, the IDB hosted a meeting of private-sector representatives of the freight transport industry in Latin America. The project’s goal is to develop a “methodology that works well with the least amount of data possible, and that can be verified and compared” said Guerrero. Along with Guerrero and Holguín-Veras, attendees at the meeting included Elcio Grassia, a member of the Supply Chain Council’s Research Committee (APICS Brazil); Tayguara Helou, Vice President of the Sindicato das Empresas de Transportes de Carga de São Paulo e Região (the São Paulo Regional Association of Freight Transport Companies, or SETCESP); Javier Insulza, General Manager of Chiletransporte; Edgar Higuera, Logistics Manager for the Asociación Nacional de Industriales de Colombia (the National Association of Manufacturers of Colombia, or ANDI); Eduardo Asperó, Partner and Director of Intermodal Projects at CENPORT, a Mexican port consulting firm; Carlos Santillán, President of CiaO, a Mexican operating company; and Mario Chong, Director of the Asociación Peruana de Profesionales en Logística (the Peruvian Association of Logistics Professionals, or APPROLOG).

At the meeting, one key item on the agenda was changing how the concept of freight transport is generally understood. “We are not talking about trucks, but rather about restocking of consumer goods” emphasized Insulza; this approach is consistent with the methodological proposals put forward by Holguín-Veras.

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Attendees at the meeting also looked at the challenge of getting independent carriers to make use of standardized distribution systems. In spite of the initial challenge, this adaptation would unquestionably yield benefits for the carriers in the medium and long term. Specific challenges unique to some of Latin America’s big cities were discussed as well. For example, off-hours delivery is often recommended as a way of reducing congestion during the day; however, this approach would be incompatible with ordinances in place in some cities (such as Mexico City), regarding noise during the nighttime hours. This may require changes in traffic ordinance.”

The IDB’s Transport Division will present the results of this project, including the standardized methodology, during the third quarter. The methodology that comes out of this project will be applicable to any city in the world, and it will help identify solutions that can be implemented in the supply chain, in order to reduce logistics costs resulting from traffic congestion.

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