1. What is the LPI?

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1. What is the LPI?
2. Implementation of the Survey
3. Main Findings and their Application
4. LPI Survey 2008 and Beyond
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Logistics Performance Index (LPI)and its
indicators

• Trade logistics is playing an increasingly
  important role
• The LPI provides the most comprehensive data on
  country performance

Unique and consistent resource for policy
makers, reformers, and the trade facilitation
constituency
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What is the LPI

• The LPI is an effective measure of trade
  facilitation to allow policy makers and
  researchers to
• benchmark a countrys overall performance on
  several dimensions in trade logistics, and
• assess the quality of a countrys connections
  to the global market

The Project
The Dataset

• Is the product of a survey of operational staff
  in global forwarding and express carriers
  companies.
• Is designed to assess their perception of trade
  logistics performance of the countries they are
  dealing with and in the country in which they
  operate.
• Is now available to policy makers, researchers,
  firms, stakeholders, and international
  organizations (e.g. World Bank, IMF, WTO, WCO,
  UNCTAD) to further promote the agenda of trade
  facilitation.

• Built upon the positive results demonstrated
  through pilot surveys that were carried out for
  the World Bank by TSE, Finland.
• Is supported by the members of GFP with active
  support and participation of FIATA and GEA.

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Unique dataset to measure country performance
across several dimensions of logistics

• Infrastructure
• Customs and border processing
• Logistics competence of local service providers
• Domestic costs
• Timeliness
• Tracking and Tracing
• Ease of arranging international shipments

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• Partnership with the private sector

• Worlds largest freight forwarding and express
  carriers companies, and several national/regional
  associations were surveyed through a web-based
  questionnaire
• Increasing country coverage - LPI Built upon 5500
  country international assessments

Global Facilitation Partnership The GFP will be
instrumental in the dissemination strategy.
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• Innovative methodology
• Assessments from professionals outside the
  country, trading with it
• Assessment of domestic business environment
• Numerical information (time and cost data)
• Questionnaire designed with input from logistics
  professionals
• Primary data gathered for 150 countries

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• www.worldbank.org/lpi
• Overall synthetic index (LPI) on a 1-5 scale,
  Ranking and component
• Logistics Business environment
• Numerical data
• Available as Rankings, Maps, scorecards

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LPI Survey - Implementation
A two-step approach.
Partner entities Multinational firms/ National
Associations of FF

• Management agrees to sponsor the LPI survey with
  project team
• Senior management identifies a focal person
• The focal person mobilized operational personnel
  the respondents (i.e. sent an e-mail
  invitation to take the survey)

Respondents Within the Partners

• Respondents were the participating logistics
  professionals who deal with international
  shipments

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Role of Partners
Commitment
Benefits

• Get access to comparative analysis of the
  logistics perceptions of their firm against the
  LPI results.
• Receive a report on 30 countries of choice free
  of charge.
• Have the opportunity to interact with the LPI
  team of experts.
• Obtain the right to use the LPI logo for public
  relations.

• Assigned a global focal contact person in their
  firm who assisted with making practical
  arrangements for the LPI survey.
• Engaged key personnel worldwide in answering the
  LPI survey.

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World Map provides a color-coded map for the
global view of the overall LPI index and the
seven key dimensions
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Overall LPI Ranking presents performance scores
of all countries on the overall LPI index, as
well as on the seven key dimensions, in a
sortable table format
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Overall LPI Scores
TOP 10 COUNTRIES
UPPER MIDDLE INCOME
TOP 10 COUNTRIES
LOWER MIDDLE INCOME
TOP 10 COUNTRIES
LOW INCOME
Country LPI LPI
Country Rank Score
South Africa 24 3.53
Malaysia 27 3.48
Chile 32 3.25
Turkey 34 3.15
Hungary 35 3.15
Czech Republic 38 3.13
Poland 40 3.04
Latvia 42 3.02
Argentina 45 2.98
Estonia 47 2.95
Country LPI LPI
Country Rank Score
China 30 3.32
Thailand 31 3.31
Indonesia 43 3.01
Jordan 52 2.89
Bulgaria 55 2.87
Peru 59 2.77
Tunisia 60 2.76
Brazil 61 2.75
Philippines 65 2.69
El Salvador 66 2.66
Country LPI LPI
Country Rank Score
India 39 3.07
Vietnam 53 2.89
Sao Tome and Principe 57 2.86
Guinea 62 2.71
Sudan 64 2.71
Mauritania 67 2.63
Pakistan 68 2.62
Kenya 76 2.52
Gambia, The 77 2.52
Cambodia 81 2.50

• The overall LPI, on a 1 (worst) to 5 (best)
  scale) is aggregated by standard techniques (PCA)

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Consistency Robustness

• LPI consistent with intuitive knowledge of
  country performance, very specific ranking
• Homogeneous respondent population
• The LPI, on a 1 (worst) to 5 (best) scale) is
  aggregated by standard techniques (PCA), so as to
  reduce noise,
• Confidence interval (/- 10 ) provided, on
  average 8 places in the ranking.

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Numerical Outcomes
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Key Findings
LPI strongly associated with competitiveness
outcomes growth, trade expansion and
diversification of exports

• Perceptions matter, professionals views are
  significant
• Performance depends upon infrastructure, border
  processes, and quality of services - areas where
  significant gaps are observed but
• the level of service (predictability,
  reliability) ultimately matters most for traders
  and depends upon the weakest link in the supply
  chain
• Private sector services as well as public
• More than income level

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More than income the logistics gap
China and Thailand
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Key Policy Implications

• Expand the traditional agenda
• infrastructure and customs IT, to areas such as
• logistics services or border agencies
  coordination
• Synergies and comprehensiveness of reforms
• Cross-cutting reforms supported by broad
  constituencies
• exporters, service operators, public agencies
• Typology and rankings
• capacity to initiate a virtuous circle of
  performance improvement

New thinking needed to address the case of the
most severely constrained countries (e.g. LLDCs)
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What is next?

• The World Bank and its partners plan to replicate
  the survey (Mid Nov-Mid Jan)
• Improved and more friendly questionnaire
• Increase the number of respondents
• Involve additional sponsoring organizations,
  including national associations

Global launch of the LPI Nov 5 www.worldbank.org/l
pi