Freight News, Logistics

Europe counts the cost of crisis

[ November 9, 2015   //   ]

Essential goods including medical supplies are being delayed and destroyed as a result of the European migration crisis, costing the UK economy over £600 million in the last year alone, according to the latest BSI Supply Chain Security Risk Index. BSI said that, in September, Europe saw the highest number of border closures since the signing of the Schengen Agreement in 1995. It warns that, with no signs to the end of crises in the Middle East and Africa in sight, costs to international shippers will continue to rise.
The BSI Supply Chain Security Risk Index is based on data from BSI’s Supply Chain Risk Exposure Evaluation Network which provides continuous evaluation across more than 20 risk factors in 203 countries. The report said that closures in Calais added an estimated $1.2m per day to the cost of transporting goods to the UK with delays of nine hours or longer, while border closures in Southern Germany, Serbia, Croatia and Hungary have also hit transport firms hard. Food and pharmaceutical shipments are worst affected, with one shipment of medical supplies worth $3.9 million having to be destroyed after stowaways broke into the container.
BSI’s global intelligence program manager, Jim Yarbrough, commented: “More so than any other economic bloc, Europe relies upon free trade. Every shipment delayed, contaminated or destroyed, raises the cost to the end-consumer. For exports this hurts competitiveness, undermines productivity and risks jobs; for imports it raises the cost of living for each and every citizen.”
Elsewhere, South Africa has seen a 30% increase in violent hijackings over the last year, with thieves switching from targeting only high-value goods such as cigarettes to lower-value items such as clothing as well.
In China, criminals are deploying tactics straight out of Hollywood movies, as they board speeding trucks and pass down stolen goods to their accomplices.
Yarbrough concludes: “Economic volatility and uncertainty in markets such as South Africa and China is creating an ever more serious criminal threat to goods shipments. Highways such as the G45 north of Guangzhou are becoming notorious for ‘kaitianchuang’ thefts, where criminals leap aboard speeding lorries in scenes reminiscent of action movies. Even more violent tactics are seen in South Africa. While it is most often high value pharmaceuticals or electronics targeted in these well-planned raids, the trend is moving toward lower value goods. Effective supply chain planning can help firms route around such dangers, and make sure back-up supplies can be swiftly located if the originals are looted.”