Economic Development Indices Questions Medium
The Global Logistics Performance Index (LPI) is calculated based on a comprehensive assessment of various factors related to logistics performance in different countries. The calculation involves a combination of quantitative data and qualitative assessments from surveys conducted among logistics professionals and experts.
The LPI consists of six main components, each with its own weightage in the overall index calculation. These components include:
1. Efficiency of customs and border management: This component measures the efficiency and effectiveness of customs procedures, border management, and trade facilitation measures.
2. Quality of trade and transport infrastructure: It assesses the quality and adequacy of infrastructure such as ports, airports, roads, railways, and information technology systems that support trade and logistics activities.
3. Ease of arranging international shipments: This component evaluates the ease and efficiency of arranging shipments, including the availability and quality of logistics services, tracking and tracing capabilities, and the use of technology in logistics operations.
4. Competence and quality of logistics services: It measures the competence and quality of logistics services providers, including freight forwarders, customs brokers, and transport operators.
5. Tracking and tracing: This component assesses the availability and effectiveness of tracking and tracing systems that enable the monitoring and visibility of shipments throughout the logistics process.
6. Timeliness of shipments: It evaluates the timeliness and reliability of shipments, including the speed of customs clearance, delivery times, and the predictability of logistics operations.
To calculate the LPI, data is collected through surveys conducted among logistics professionals, including freight forwarders, logistics service providers, and customs brokers. The respondents rate the performance of logistics in different countries based on their experiences and perceptions. The collected data is then analyzed and weighted according to the importance of each component to derive the overall LPI score for each country.
The LPI provides a comprehensive and comparative assessment of logistics performance across countries, enabling policymakers, businesses, and researchers to identify areas for improvement and make informed decisions to enhance logistics efficiency and economic development.