How Urban Planning is Affecting Australian Supply Chains

Recent data has shown that Asian economies will be larger than the rest of the world combined and home to half of the world’s middle class by next year.

Successive Australian governments have recognised the opportunity that comes with our proximity to Asia and our unique capacity to meet the needs of the growing prosperity of our Asian neighbours. Our need to boost exports and taking advantage of this increasing demand has been behind the present government’s pursuit of free trade agreements with key regional trading partners including South Korea, Japan, China, Taiwan and Indonesia over recent years.

This is good policy as trade agreements are a huge positive for consumers in Australia, as some of our key imports, including items such as petroleum, furniture, wood and footwear, no longer have tariffs applied to them, meaning lower prices for households and businesses.

Yet it seems the act of signing an agreement is no guarantee of an outcome. Intentions must be supported with policy actions. If the critical freight infrastructure servicing Australia’s supply chain management functions is not operating at optimal levels of efficiency and safety, then the productivity and competitive advantages offered by free-trade agreements will be muted.

It is a characteristic of many of Australia’s major ports that they are in proximity to our major cities. The increasing desirability of metropolitan living — which is partly a function of Australia’s decline in manufacturing and economic reorientation as a services-based economy — is having a large impact on the ability of freight logistics professionals to meet business and consumer expectations around delivery of goods.

Restrictive practices such as noise curfews and heavy vehicle bans on certain routes may seem appealing as a quick fix when it comes to addressing concerns of metropolitan residents. However, ultimately denying freight logistics operators the flexibility they need to do their jobs effectively harms productivity and means that consumers pay more for goods. One of the major challenges of supply chain management operators has been the prioritisation of residential developments over logistics lands when it comes to land-use planning will ultimately hamper our economic performance. By placing large-scale residential developments in proximity to ports gives rise to externalities such as road congestion that reduce community amenity and add to consumer costs in urban supply chains. These points have to be considered when making urban planning and supply chain decisions.

So, what can be done to address these issues? Although planning policy is primarily a matter for state and local governments, our supply chains do not stop at state borders. A consistent nationwide approach to planning and prioritising freight movement is urgently needed — and demands leadership at the national level.

Given the crucial role that Australia’s ports play in facilitating the import of goods relied upon by all Australian households and businesses and the export of goods to Asian markets, it is important that the federal government prioritises planning practices and the development of infrastructure that ensures Australia’s port precincts (both air freight and ocean shipping) are accessible, efficient and safe.

This may include rewarding jurisdictions that can demonstrate a coherent approach to corridor protection, do not impose curfews on port operations, take action to address road congestion in port precincts through increased use of short-haul rail, or provide dedicated infrastructure that facilitates heavy vehicle access to ports.

Our ports feed and influence Australia’s entire supply chain, underpinning the nation’s continued economic health and their value should not be under-sold.

This article was referenced from:“The supply chain is lagging when it comes to land” – Transport & Logistics News (Kirk Cunningham, June 2019)

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