Logistics costs in South Africa : the case for macroeconomic measurement
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In South Africa, logistics optimisation is largely managed from a microeconomic perspective. This paper makes the case for macroeconomic logistics measurement, presents the results of the country's national logistics cost model and proposes the first key macroeconomic logistics indicators for South Africa. The research shows that South Africa's logistics costs are higher than the global average. The majority of these costs are attributable to road transport, of which the biggest cost driver is fuel, which in turn is determined by volatile oil prices. This poses a significant exogenous risk to logistics cost management in South Africa. The risk can be mitigated through a structural adjustment in long-distance freight transport (from road dominated to rail dominated). The paper concludes by proposing two key macroeconomic logistics indicators to facilitate this process. © 2010 The Author. Journal compilation © 2010 Economic Society of South Africa.