Green Worldwide Shipping is the presenting sponsor of Global Atlanta's Trade Channel. Sign up here for monthly global trade updates.
The blurring of lines between the so-called developing and developed worlds became increasingly evident during a panel discussion that launched the 2015 Georgia Logistics Summit in Atlanta March 31-April 1.
Panelists included Bernd Baunack, managing director and national manager in Vietnam for Kuehne & Nagel; Steven Markham, CEO, of BLG Logistics Inc.; Chris Swartz, director of global transportation, AJC International and Josip Tomasevic, vice president and chief product officer, AGCO Corp.
Michael Burke, a partner in the Washington office of the Arnall Golden Gregory LLP law firm, served as moderator and steered the conversation through the ups and downs caused by the choppy waves of the global economy.
All the companies represented on the panel have operations around the world and face regularly the challenges of security, fluctuating currencies, changing tariff policies, bureaucratic snags, corrupt practices, shifting political alliances, altering weather conditions, competition, lockdowns at ports and stevedore strikes and labor shortages, among others.
Given that BLG Logistics is the American affiliate of a global German company; that Kuehne + Nagel was founded in Bremen, Germany 125 years ago; and that AGCO Corp.’s chairman, president and CEO is German, the weight on the developed nation side was definitely pro-German.
While all these companies are conducting business globally and benefit from the fast growth in some developing countries, of course they remain deeply engaged in the developed world.
For instance, AGCO is expanding its agriculturally related operations throughout the world, but it continues to invest in Germany, Mr. Tomasevic said because “the best high tech solutions can be found in Germany.”
Based in Atlanta, AJC International markets frozen and refrigerated food products as well as providing logistics services. With 14 other offices around the world and scores of customers and suppliers in more than 140 countries, it follows global developments on an intimate basis.
Yet despite his company’s enormous success, Mr. Swartz was most adamant about the infrastructure problems faced in the U.S., providing a sharp contrast to the upbeat remarks about Vietnam from Kuehne + Nagel’s Mr. Baunack.
Mr. Baunack pointed out that several tech firms including Samsung, Intel and Nokia have set up manufacturing bases in Vietnam, which has lower labor costs than neighboring China, with a minimum wage of between $100 and $150 a month.
Even in view of some of the labor strife that has accompanied the Vietnamese government’s efforts to attract more high-tech manufacturing, he was enthusiastic about the country’s development.
He also said that he especially has been impressed by the population’s desire to learn the skills required in the logistics business, and he cited the widespread use of English as an example of its adaptability.
According to Mr. Baunack, Vietnam has developed fairly quickly despite the war which left it in ruins, and today it can boast of having two world class airports and modern, well-equipped ports in the south with established ports in the north undergoing modernization.
In sharp contrast to Mr. Baunack’s upbeat remarks, Mr. Swartz called the situation of ports on the West Coast of the U.S., which have been closed to cargo freighters periodically due to strikes by the dockworkers’ union, “unacceptable.”
He also was critical of the deteriorating state of the nation’s roads and railroads and the lack of cohesive transportation planning. “If we don’t get our act together, we will slip,” he said.
This theme emerged again in the summit when Curtis Foltz, executive director of the Georgia Ports Authority, also expressing concern about the state of the U.S. ports.
Like Mr. Swartz his concerns were not limited to the blockages on the West Coast of the U.S., but also about the condition of the ports on the East Coast such as those in New York and New Jersey, which are deep enough for the larger cargo vessels to access but are blocked from doing so by a bridge that isn’t tall enough to accommodate them.
Mr. Markham’s parent company BLG Logistics Group has managed ports since the 1870s and has a network of more than 20 terminals in international locations. Its terminal in Bremerhaven is one of the largest automobile ports in the world.
He said that BLG Logistics’ expertise in managing these facilities has developed over the years and can’t be duplicated automatically. Yet, he added, that Germany with the fourth largest gross domestic product in the world also experienced a serious economic challenge when faced with having to develop Eastern Germany after the collapse of the Soviet Union.
Eastern Germany now has some of the most modern infrastructure in the country, he said, a result of a planned national strategy, the sort of strategy that Mr. Swartz lamented doesn’t exist in the U.S.
All the panelists were adamant on the abilities of their companies to maintain a hardline to prevent their involvement with corrupt practices that they often face.
While doing business in Vietnam has been plagued with corruption, Mr. Baunack said that even its government now realizes that the risks are too great for foreign companies to be caught in such practices due to the Foreign Corrupt Practices Act and that it has begun to crack down heavily on its prevalence.
Numerous other panels took place during the conference held at the Georgia World Conference Center with special emphasis on the growth of e-commerce and the prospects for transporting perishables through Georgia.
Videos of the panels are to be available at the summit’s website.