Business, Freight News, Logistics


Smoother cross-border flows could be £4bn boost for economy

[ September 4, 2023   //   ]

A new report by Oxford Economics on behalf of Logistics UK is calling for more targeted government investment in the sector and action to improve the flow of goods across borders which could boost GDP by £3.9 billion a year by 2030.

‘Logistics: Delivering a solution to the UK’s productivity puzzle’ says that the country’s logistics system is being held back by border friction and a lack of investment in national infrastructure, innovation and skills.

Logistics UK chief executive, David Wells, comments: “The UK’s economy faces a productivity challenge at present, but logistics can be a big part of the solution. This report, conducted on our behalf by Oxford Economics, emphasises how improving the productivity of the logistics sector, one of the UK’s most significant economic contributors, would have a positive impact on the whole economy.

“However, the findings also suggest that reversing the UK’s decline in productivity and delivering these gains is beyond the control of industry operators alone and will take concerted effort and investment by government.”

He said that it is imperative that government works with the sector to establish a cross-Whitehall Logistics Productivity Forum.

With the UK currently in joint 19th position in the World Bank logistics rankings – a substantial drop from an average ranking of 6th between 2012 and 2018 – the report, sponsored by Amazon and Volvo Trucks, outlines how a return to the top ten would unlock a significant boost in GDP through productivity gains.

This would not only result in an approximate £80 per annum increase to the annual income of the UK’s 30 million households – a £2.3 billion boost to domestic budgets by 2030 – but could also raise enough in additional taxation to finance the annual salaries of more than 20,000 nurses.

The analysis also highlights that, while there would be a significant economic benefit for the UK from addressing these challenges to close the gap with other nations, this must be achieved alongside delivering the transition to a green economy. 

Oxford Economics associate director, Anubhav Mohanty, added: “Our analysis highlights the potential value that can be gleaned by enhancing the UK’s logistics performance, by improving the predictability, timeliness and value-for-money of domestic and international shipments, including through improvements to infrastructure and customs processes and investment in innovation and skills. But a collective effort is required, with the government collaborating closely with businesses, to ensure that the country’s logistics sector can operate optimally, thereby bolstering overall economic growth and global competitiveness.”

https://logistics.org.uk/research-hub/reports/logistics-delivering-a-solution-to-the-uk-s-produc

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