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The Impact of Port Transport-Logistics Infrastructure and LPI for Economic 63 Scientific Journal of Maritime Research 33 (2019) 63-75 © Faculty of Maritime Studies Rijeka, 2019 Multidisciplinary Multidisciplinarni SCIENTIFIC JOURNAL znanstveni časopis OF MARITIME RESEARCH POMORSTVO https://doi.org/10.31217/p.33.1.7 The Impact of Port Transport-logistics Infrastructure3 and LPI for Economic Growth:1 on the Example2 of Landlocked Countries Madina1 Duzbaievna Sharapiyeva , Alfonz Antoni , Raikul Yessenzhigitova 23 Al Farabi Kazakh National University, Republic of Kazakhstan, Almaty, 050038, al-Farabi ave., 71, e-mail: [email protected] Budapest Metropolitan University, Hungary, Budapest 1148. Nagy Lajos kir. Út 1.-9, e-mail: [email protected] Al Farabi Kazakh National University, Republic of Kazakhstan, Almaty, 050038, al-Farabi ave., 71, e-mail: [email protected] ABSTRACT ARTICLE INFO For this study, carried out as an empirical study, 37 landlocked countries have been selected. And Preliminary communication a broader economic impact on the national economy, on the quality of the port infrastructure and Received 12 March 2019 logistics efficiency has been considered as well as investments on creating a high quality port KeyAccepted words: 6 May 2019 infrastructure and its contribution to the economy, often questioned by politicians, investors and general public. The Structural Equation Model (SEM) has been used for providing empirical data about a significant economic impact on the port infrastructure quality and logistics efficiency. Economic growth However, some countries that do not have access to the sea are not, according to international LPI agreements, inferior to other countries in terms of economic growth. Structural Equation Model (SEM) Quality of infrastructure Logistics efficiency 1 Introduction ferent customs control procedures and bribery. All these problems support transportation costs on an artificially Nowadays, economy is not stable and the majority of high level. countries, especially the landlocked ones, have suffered Investigation of the economic impact has a vital value because of inflation. For Afghanistan, Central African for the creation of an economic value for the large infra- Republic, Burundi, Kazakhstan and other countries that do structure objects. The trade-off between direct transpor- not have an access to the sea, the imported oil, food and tation costs and reliability varies depending on trade in other goods are delivered at a high price and take longer goods and logistics in the country, which may limit the po- time. Hence, it is hard to export domestic products. Trade tential of developing countries to diversify from time-in- is less and economic growth rates lower than in the neigh- dependent goods to value-added goods [7]. Despite of the boring countries that have an access to the sea. Lack of an relevance, impact of the port infrastructure quality and ef- access to the sea is one of the main reasons why 16 out fectiveness of logistics to trade and economy of a country of the 37 countries, surrounded on all sides by land, are has been largely ignored in the existing literature of ports among the poorest countries in the world.Road conditions economics. Landlocked countries i.e. countries that do not are not the main reason for low efficiency and expensive- have a direct access to the sea and which, accordingly, can- ness of transportation. This means that effective infraprob- not participate in maritime trade, have significant and spe- lemsstructure related is notto theable lack to solveof an all access issues. to Manythe sea researchers cific problems [1]. claimed that effective infrastructure could solve all In comparison with other countries, they meet nu- . However, merous difficulties in trade operations from the begin- as presented in the last studies, the key problem is the ning. This kind of position almost always gets worse, if delivery of cargo to these ports. Among other issues, it is difficulties of getting access to the sea are supported with important to note delays of cargo at the border, the prev- other factors as remoteness from major markets, tropical alence of cartels in the field of road transport many dif- climate, great distance from the coast, underdeveloped M. Duzbaievna Sharapiyeva et al. 64 / Scientific Journal of Maritime Research 33 (2019) 63-75 infrastructure or lack of appropriate political, legal or in- The majority of the above mentioned problems have stitutional conditions. caused a poor economic growth in landlocked African In the world of today, rivalry of a landlocked country is countries, which are located far from markets and sea very weak. Development history of cities has also shown trade routes and which are generally not accessible for that economic growth is especially noticeable in cities oceangoing vessels. For the exports of landlocked coun- with seaports (Chan et al., 2014). However, the lack of tries, reconstruction plays the key role. According to the seaports has created certain problems that have not been East African Cooperation organizations, an intergov- resolved. These types of problems that landlocked coun- ernmental organization created by Kenya, Uganda and tries meet have practical solutions, as well as integrated Tanzania, out of the three countries joint road network, approaches to the creation of transit corridors, general 84% require immediate action, i.e. only 16% of the roads activities for the development of regional integration, reg- are updated or maintained in any other way from time ulatory reforms, special international protection mecha- to time. However, it is encouraging that in Africa there nisms, as well as an in-depth analysis of the foreign trade are three landlocked countries (Botswana, Lesotho and structure of each landlocked country and its adequacy in Swaziland), that have one of the sustainable growth rates. terms of transport difficulties [15]. Globalization of difficult processes of the industrial The real problem is the delivery of goods without seri- production amplified the meaning of seaports in a global ous delays and increase in the cost because of legal, admin- supply chain. The provision of logistics services in an in- istrative, customs or technical barriers. These are the main ternational context has become a major part of the busi- issues for all countries, but more acutely felt by landlocked ness. In this situation, more important aspects of logistics countries, and, in particular, developing or remote coun- efficiency are expenses on logistics and reliability of the tries that do not have an access to the sea. A coordination supply chain. Poor logistical assistance greatly affects the of the infrastructure functioning through borders is diffi- country’s competitive advantages [7]. The main economic cult. Therefore, high transport costs, due to infrastructure growth strategies of developing countries are intensive deficiencies, delays, charges or procedures in the transit export production or assembly. However, importing prod- country, make the country, as a part of the transport of ucts take a significant part of them, being connected with goods to landlocked countries, very expensive and force certain transportation costs and leads to lower profits in them to store large amounts of stocks. Transportation landlocked countries. Thus, it is real to concern that these costs for these countries still remain the greatest obstacle geographically isolated countries as Mongolia, Ruanda, in access to the world market and a rivalry between other Burundi, Kazakhstan or Bolivia, will face serious difficul- countries in fair terms. ties in trying to reproduce the model of rapid economic Based on this, the closer a landlocked country is locat- growth based on the development of intensive export in- ed to the coast, the more it can benefit from relatively low dustries. If we do not take into account these landlocked cost of the transport by sea. However, if a landlocked coun- countries that are located close to their markets and have try has navigable inland waterways that connect it with the facilitated access to interconnected transport networks, coast then isolation becomes an even simpler problem for as, for instance, in the case of Hungary located in Europe, the country. If additionally to this, the country has a neces- the development of comparative advantages in modern sary infrastructure, i.e. roads and railways, ports, then the high-tech industries is difficult [27]. actuality of the problem connected with geographical re- The access of the landlocked countries to the market, moteness gets much lower. However, on the other hand, this and their abilities to trade i.e. efficiently and economically requires cooperation with the transit country. Therefore, for move exports and imports are key elements of maintain- instance, in order to increase import and export to Ruanda ing consumption levels and promoting economic growth. and Uganda, it was necessary to modernize the system of Trading has also an important meaning from the point of the railways in Kenya. Furthermore, a coordinated approach economic reconstruction of landlocked countries, which to the infrastructure development is needed. An example of are often looking for funds for compensating the conse- an insufficiently coordinated infrastructure development quences of deterioration in terms of trade, civil unrest for a long time was a pool of the Parana River in Paraguay. or natural disasters. Expensive and unreliable transport In the majority of cases, expenses of landlocked coun- hampers trade and, in addition to the above, is often com- tries, increase not only due to the lack of proper infrastruc- plicated by the problem of transit. ture, but because of problems connected with capacities Ng (2013) noted that, with the current concentra- starting from the lack of containerization and the poor tion of researches in ports on daily port operations (that, development of cargo handling facilities and ending with on port productivity and competition, port management, non-developed railway rolling stocks or ships and barges. port and supply chain management), port-region related In the end, these landlocked countries can neglect the ex- researches have decreased significantly since 1990.
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