The Logistics Sector on the Southern Shores of the Western ... - cetmo

October 2010<strong>The</strong> <strong>Logistics</strong> <strong>Sector</strong>on the Southern Shores of the Western Mediterraneanpressure from a rail competitor to drive improvements in road transport.InsufficientregulationInsufficient trainingConclusionForwarding agents, intermodal operators and logistics operators needregulation in order to diversify and enjoy a complete regulatoryframework in the logistics sector.Although the general level of training is good, vocational training needsto get better in order to meet international standards.Suppliers have had a positive impact on the modernization of the Libyanlogistics industry, particularly in terms of infrastructure.Barriers to Entry and Potential EntrantsNo 49% limit In Libya there is no 49% limit on foreign shareholders in a transportcompany. <strong>The</strong> authorities are encouraging the creation of joint venturesand the hiring of Libyan workers.No barriers toentering the roadtransportmarketSocialist PortCompanymonopolyConclusionCompetitorsTangerMedTunisiaEgyptConclusion<strong>The</strong> Ministry of Transportation does not impose any professionalrequirements for the creation of a transport company with less than fivevehicles, and in fact there is no register of such companies at present.With the exception of Misurata, which is also run by a State-ownedcompany, port services are provided by a single public operator. <strong>The</strong>interviewees consider the provision of services to be good.<strong>The</strong>re are no significant barriers to new operators entering the market,except for in the area of port handling, and therefore barriers to entry donot present any obstacles to the modernization of the logistics industry inLibya.TangerMed is competing with Misurata to become a maritime hub in theSouthern Mediterranean, as the Djen-Djen (Algeria) and Enfidha(Tunisia) deep-water ports are still in the design stage.Libya has an agreement with Tunisia on the free circulation of goods.Tunisian transport companies need to expand their markets and have agreat deal of international experience.Port Said is a very efficient maritime hub for traffic on the Far East route.Furthermore, Egyptian transport companies are significant competitors,although this is not an issue at present, given the closure of the borderdue to problems with illegal immigration.Competition from neighbouring countries puts significant pressure on theLibyan logistics sector, although the effect is lessened at present owingto the existence of the domestic market to fall back on.<strong>The</strong> <strong>Sector</strong>’s Internal SituationGood profit Despite the fragmentation of the industry, there do not appear to be anymargins for pricing scenarios that could threaten the existence of companies thattransport by road transport freight by road. This is in part due to the growth rate of thedomestic market.Control of the portmarket for roadtransportThis transport market is going through a process of cartelization and itsprices are higher than those for general transport, which reduces thecompetitiveness of Libya’s exports.112 CETMO