Supply Chain and Transport

3 lessons in logistics for a more resilient global trading system

An employee packs medical masks, that are part of personal protection and survival equipment kits ordered by customers preparing against novel coronavirus, at a centre of an express delivery company in Porto Alegre, Brazil February 28, 2020. REUTERS/Diego Vara - RC2T9F9ZY8W4

Global supply chains need to keep moving now more than ever. Image: REUTERS/Diego Vara

Laura Lane
Chief Corporate Affairs Officer, UPS
Carlos Grau Tanner
Director-General, Global Express Association
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Supply Chain and Transport

  • The express delivery industry has proven resilient during the pandemic, but it was not smooth sailing.
  • Lessons learned should inform future policies to make global supply chains and the trading system more durable.
  • Stakeholders must work together to create a modern logistics system worthy of the collective challenges faced by the world now and in the future, including the delivery of vaccines, and to help the world truly recover from the COVID-19 pandemic.

Republished with permission, this article first appeared on Longitudes, UPS’s thought leadership blog.

When the COVID-19 pandemic hit, businesses, governments and NGOs suddenly had to move an unprecedented volume of critical supplies around the world faster than ever imagined.

Healthcare workers and communities needed medical equipment, medicine and food. In addition, businesses large and small depended on efficient express delivery to keep pace with spiking consumer demand for e-commerce.

The express delivery industry rose to the challenge — it delivered. The crisis, however, caught some stakeholders unprepared. Despite good intentions, uncoordinated efforts led to significant disruptions.

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Some governments quarantined cargo flight crews systematically, even if they showed no symptoms or did not come from a COVID-19 hotspot. Some cities imposed neighbourhood-specific curfews for no reason (starting in the early hours of the afternoon).

Border crossings closed to all traffic, including international trucking. Drivers faced inconsistent health protocols. Officers at border customs operations could not reach their post because of public transportation lockdowns, nor could they work from home thanks to paper-based clearance systems.

Intense industry lobbying changed many of these measures to allow for the movement of critical goods across borders. International organizations that understood the interconnectedness of international cargo networks similarly issued guidelines to align government initiatives.

But some barriers remain and continue to disrupt global supply chains.

Not plain sailing: disruption to global trade as a result of COVID-19 Image: World Trade Organization

COVID-19 intensifies our preparation

Moving cargo around the planet is a complex job, often consisting of multiple stops and handoffs along the way.

The pandemic has taught us many important lessons about streamlining an imperfect system, including protocols to make global cargo air networks more predictable and safer for pilots and crew alike. The pandemic has also highlighted the importance of modernizing the border clearance process and implementing agreements to help promote economic recovery.

The pandemic has shown that governments and international organizations need to join forces with the private sector to better expedite the flow of goods across borders and bolster preparation for future, large-scale disruptions.

UPS and the Global Express Association, which represents the three leading global express delivery carriers, have provided practical policy recommendations to keep supply chains operating smoothly.

We highlight some of the lessons learned and recommendations below:

1. Liberalize air cargo transportation services to help carriers move cargo from one side of the planet to the other.

Early in the COVID-19 crisis, when passenger travel restrictions suspended commercial flights, express delivery service providers had to significantly increase capacity and work twice as hard to ship and deliver global air cargo.

Passenger planes had routinely carried more than just travelers and their belongings. Half of global air cargo had traveled in the belly of passenger planes before the COVID-19 crisis.

With many of the passenger aircraft grounded or still waiting on passenger travel to return, governments must ensure cargo airlines can build out efficient global networks and transport critical shipments quickly. Constraints on air cargo movements and costly red tape cause delays, create inefficiencies and put economic penalties on business needed to move goods efficiently.

2. Implement protocols to ensure the safety of air cargo crews and other workers.

Health protocols for air cargo crews vary from country to country. A standardized approach would facilitate more timely flight operations while preventing the spread of COVID-19.

The International Civil Aviation Organization (ICAO) developed a global framework for countries to enable safe travel for cargo pilots and crews. We recommend that countries adopt the ICAO Public Health Corridor, which includes equipping aircraft with PPE to keep COVID-19 from spreading.

ICAO’s risk-based approach takes into account safety management principles, recommendations from the World Health Organization (WHO) and other aviation pandemic guidance.

Best practices include keeping airport operations open for all cargo traffic and creating special airport hotel plans so crews can rest without exposure to the public.

3. Approach border clearance like a gateway, not a checkpoint.

Barriers to express delivery include significant customs clearance hurdles. Customs and border agencies provide an essential service to help goods clear borders swiftly. However, inconsistent rules and restrictions around the world make trade unpredictable.

Customs modernization is critical for fast border clearance. International gateways must leverage the right technology such as electronic records, e-payment and digital risk management processes. Countries should also embrace progressive regulations that help us transport life-saving shipments and reduce physical contact at border crossings and during last-mile delivery.

Existing international treaties such as the Revised Kyoto Convention and the WTO’s Trade Facilitation Agreement make this possible. To work, though, governments must fully implement the agreements.

COVID-19 lessons help us create a more resilient global trading system

These solutions will facilitate commerce, revitalize businesses and help provide humanitarian relief to those who need it most — not just during the coronavirus pandemic but every day and in preparation for future global crises.

When governments work together, express delivery carriers can respond to international needs through efficient and predictable supply chains.

We stand ready to help build a resilient global delivery network. We welcome stakeholders from every corner of the globe in pursuit of a modern logistics system worthy of the collective challenges we face now and on the horizon, including the delivery of vaccines to help the world truly recover from the COVID-19 pandemic once and for all.

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World Economic Forum articles may be republished in accordance with the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International Public License, and in accordance with our Terms of Use.

The views expressed in this article are those of the author alone and not the World Economic Forum.

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Supply Chain and TransportCOVID-19
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