February 25, 2024

The demand for green logistics is rising, with the majority of shippers looking for environmentally friendly options when exporting to high-income countries, according to a report of the World Bank (WB).

“Environmentally sustainable logistics options can lessen the carbon footprint of supply chains and keep trade moving. Environmentally friendly options include shifting to less carbon-intensive freight modes, more energy-efficient warehousing, or better capacity utilization,” said WB’s 2023 Logistics Performance Index report.

The report said demand for green shipping options is highest (75 percent) for exports to countries in the top two performance quintiles and lower for exports to countries in the middle (over 20 percent) and bottom two (10 percent) quintiles.

It said this trend is in line with the increasing number of global and national commitments to reduce logistics-related greenhouse gas emissions and other harmful emissions, for which targets are becoming ever more challenging in all transport modes.

“This regulatory pressure is mounting in air, road, and maritime transport. It drives the change to more environmentally friendly logistics processes and equipment, especially when they can generate economic savings,” it added.

The WB said the pressure from demand forces is gaining momentum, particularly in high income countries.

“For policymakers this means that the search for implementable ‘green logistics’ policies is becoming more important,” it said.

The report further said as the 2020s are turning into a period of transformation for global supply and value chains, businesses and governments are concerned about increasing the resilience and robustness of supply chains, in addition to efficiency.

It said efficient management and use of information technology solutions in both the private and public sectors are tools for high-quality logistics.

“Here, the importance of digitalization is growing, boosted by the rapid advancement of software, hardware, and innovation. One obvious area of development is to increase supply chain visibility, the benefits of which were made clear by the recent turmoil. Managing Big Data approaches also brings new business opportunities, as well as analytical applications, which push technological innovation further,” it added. – Press release