|Eco-restructuring: Implications for Sustainable Development (UNU, 1998, 417 p.)|
|Part II: Restructuring sectors and the sectoral balance of the economy|
|11. The restructuring of transport, logistics, trade, and industrial space use|
As concerns reducing the environmental impact of the freight transport sector, virtually all present trends point in entirely the wrong direction. Freight volumes (measured in tonne-kilometres) are increasing not decreasing. Moreover, the growth in freight volumes is now attributable almost entirely to increases in the distance that goods are transported - reflecting greater separation between points in the value-adding chain - rather than to increases in the quantity of goods transported. What is worse, transport volume per capita tends to increase as societies become more affluent and, even though transport intensity (measured per unit of GDP) is beginning to fall in the most affluent societies, the decrease is more than offset by increases in GDP per capita. What matters from an environmental standpoint is that freight transport volumes and energy intensities are increasing in absolute terms.
The trends at international level are also bad. Most developing countries assisted by Western advisers and consultants, by various international agencies, and by development banks - have development strategies that are heavily based upon providing physical infrastructures to facilitate industrialization on the Western model. If successful, these would lead to their joining the industrialized West in having economies and societies that are transport intensive and fossil fuel dependent. Shachar points out that this convergence of industrialized and developing countries on the same mobility patterns and fossil-energy-based economies is one of the main reasons - if not the main reason - for our moving away from sustainability at the global level (Shachar 1991).
There is also reason for concern over the effects of further liberalization of world markets as a result of the Marrakesh agreements that concluded the final, Uruguay Round of the General Agreement on Tariffs and Trade negotiations in April 1994. Although, in principle, trade liberalization is not inconsistent with environmental protection (because measures in respect to both have a common goal in securing efficient resource allocations), the sequencing of measures is important. Although it has been pointed out that both liberalization and environmental protection policies have broadly equal claims to priority - in that barriers to free trade and environmental externalities are both alleged to cause similar allocation distortions (Repetto 1993)3 - progress toward free trade is being made more rapidly than progress toward internalizing environmental externalities. Moreover, the nature of the two distortions is fundamentally different in that tariff and non-tariff restrictions have the effect of restricting the spatial range of economic operations, both production related and marketing. In so doing, they act to limit the distortions in resource allocations - especially the excessive use of transport - that arise from market imperfections and subsidies.
Gabel (1994) has analysed the likely effects of further liberalization on freight transport, addressing the impacts arising from several different linkages. Liberalization within the transport sector itself will increase competition and lower the prices charged by operators. Liberalization within other sectors - specifically agricultural commodities, chemicals, petroleum, coal, steel, metals, and automobiles presents considerable scope for trade expansion because these have traditionally been tightly protected at national level and are transport intensive. Liberalization of the transport equipment and energy industries will likely lead to reductions in the costs of inputs relevant to the supply of transport services and therefore to reductions in transport costs. Increased geographical specialization and concentration of production will increase average haulage lengths. Inter-industry trade is more likely to increase average transport distance than intra-industry trade because the source of trade gains - factor differences and comparative advantage - is geographically determined (Gabel 1994, p. 164). The impact of economic growth and increases in per capita income is complex. Of several, partially offsetting effects, that with the greatest environmental significance is likely to be the continuing displacement of bulk commodities by lower lot sizes with higher value-to-weight ratios. Although qualifying his analysis in several ways, Gabel concludes: "In summary, virtually all of the changes anticipated to accrue from trade liberalisation will probably increase transport output" and "may lead to a shift in the mode of transport to road and air" (Gabel 1994, pp. 169 and 170).
Results from studies aimed at projecting the impact of recent EU liberalization and deregulation show similar results (e.g. Venables and Smith 1988; Gabel and Roller 1993). Based on an econometric model, Gabel and Roller forecast impacts on international transport movements of the complete elimination of internal (non-tariff) trade barriers (but not elimination of the EU common external tariff). Elimination of non-tariff barriers was found likely to increase aggregate trade volumes in all industries. Estimates of increase ranged from 16 per cent for pharmaceuticals to 133 per cent for electrical machinery. In every industry, the percentage increase in intra-EU trade volume was estimated to be larger than the aggregate, suggesting some displacement of imports from non-EU countries. In tonne-kilometre or truck kilometre terms, the effect of eliminating non tariff barriers is to increase international road haulage by 38 per cent. The results confirm the expectations of an EU Task Force, which had predicted that shifts toward liberalization and deregulation might increase trans-frontier truck traffic by 3050 per cent (CEC 1989).4