Quantitative Analysis of Road Transport Agreements - QuARTA

Book excerpt: Road freight transport plays an indispensable role in international economic cooperation and foreign trade. For short and medium distances in particular, road freight transport constitutes a predominant share of overall traffic, but it also plays a significant role in long distance haulage, where time is more of an issue. Therefore, efforts should be made to minimize any physical or administrative barriers hampering international road freight transport, given the integral part it plays in the global trade logistics industry. This study was motivated by a realization that, in the absence of full liberalization of market access, bilateral agreements are the main instrument used to govern and regulate international road transport services. Depending on their scope and the rights they grant, bilateral agreements reflect the degree of market openness between countries. The study finds that: • The texts of the bilateral agreements remain, for the most part, unknown to their intended users. Even bilateral agreements regulating the same area tend to be different in their content. • There is no overarching international template for bilateral road transport agreements. Where model agreements have been used to fill the void, their objective and limitations are not clearly defined. • There are several core elements that any bilateral road transport agreement should contain, including provisions on scope, permit management, transit rights, cabotage and other limitations, and routes. Agreements should limit the possibilities of interpretations, rent seeking behaviors and other inefficient practices. • Assessing the extent to which bilateral agreements have been implemented is difficult, yet any agreement is only as good as the extent of its implementation and enforcement. More energy should be invested in supporting the proper implementation of trade facilitation measures. The report demonstrates that it is possible to follow a systematic methodology to assess bilateral agreements between countries, and the extent to which any agreement contributes to integrated and efficient international road transport services. The report’s main message is that reform should navigate a clearly defined path, which takes into account different technical, political and economic considerations.