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Text 4

International transportation is concerned with the highest scale in the mobility of freight and passengers with intercontinental and inter-regional movements. It is consequently subject to many geopolitical considerations such as control, competition and cooperation. Globalization processes have extended considerably the need for international transportation, notably because of economic integration, which grew on par with the fragmentation of production systems and the expansion of international trade. Both processes are interdependent and require an understanding of the transactional context in which multinational corporations are now evolving. There is thus a growing level of integration between production, distribution and consumption, whose efficiency has been expanded by logistics.

With the growth of international trade and the globalization of production, international transportation systems have been under increasing pressure to support the growing demands of freight flows. This could not have occurred without considerable technical improvements permitting to transport larger quantities of freight and people, and this more quickly and more efficiently. Since containers and intermodal transportation improve the efficiency of global distribution, a growing share of general cargo moving globally is containerized. Consequently, transportation is often referred as an enabling factor that is not necessarily the cause of international trade, but a means without which globalization could not have occurred. A common development problem is the inability of international transportation infrastructures to support flows, undermining access to the global market and the benefits that can be derived from international trade.

Because of the geographical scale, most international freight movements involve several modes, especially when origins and destinations are far apart. Transport chains must be established to service these flows, which reinforce the importance of international transportation modes and terminals at strategic locations. International trade requires distribution infrastructures that can support trade between several partners. Three components of international transportation facilitate trade:

• transportation infrastructures– concerns physical infrastructures such as terminals, vehicles and networks. Efficiencies or deficiencies in transport infrastructures will either promote or inhibit international trade;

transportation services – concerns the complex set of services involved in the international circulation of goods and people. It includes activities such as warehousing, logistics, finance, insurance and marketing;

• transactional environment – concerns the complex legal, political and cultural setting in which international transport systems operate. It includes aspects such as regulations, quotas and tariffs, but also consumer preferences.

Figure 4 portrays a comparison between the notion of exchange brought by theories of international trade and the transport chain which is derived from the realization of a transaction. International trade implies an exchange between an origin (A) and a destination (B) subject to a trade barrier. The major concerns of this perspective are related to the nature of merchandises being traded, the partners involved as well as the transactional environment in which trade takes place, namely tariff and non-tariff barriers.

The realization of international trade requires a transport chain that can provide a succession of modes and terminals, such as railway, maritime and road transportation systems. As discussed in the intermodal transportation section, the first stage in the transport chain is assembly where merchandises are assembled at the origin (A), often on pallets and/or containers. The cargo being traded then moves along the transport chain, transshipped at terminals from one mode to the other. Once it enters another country, the physical component and guarantor of a trade barrier, customs inspection, takes place. This activity is dominantly located at major terminals, or points of entry, namely ports and airports. The final stage of the transport chain, disassembly, takes place at the destination (B).

Figure 4. International trade and transportation chains

Among the numerous transport modes, two are specifically concerned with international trade: maritime and air transportation. Indeed, the road and railway modes tend to occupy a marginal portion of international transportation since they are above all modes for national or regional transport services. However, a substantial share of the NAFTA trade between Canada , the United States and Mexico is supported by trucking, as well as a large share of Western European trade. In spite of these observations, these exchanges are a priori regional by definition, although intermodal transportation confers a more complex setting in the interpretation of these flows.

Economic development in Pacific Asia and in China in particular, has been the dominant factor behind the growth of international transportationin recent years. Since the trading distances involved are often considerable, this has resulted in increasing demands on the maritime shipping industry and on port activities. As its industrial and manufacturing activities develop, China is importing growing quantities of raw materials and energy and exporting growing quantities of manufactured goods. The outcome has been a surge in demand for international transportation.

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