The Effect of Freight Transport Service Performance on Global Market Competitiveness



International trade, Global Competitiveness, Logistic Performance Index, Freight transport service, Growth Domestic Product


The producers, intermediaries, shippers, and consignees, located often thousands of miles distant from each other, require efficient transport and logistics services to get the right product with the right quality and quantity to the right place within the right time and above all at a right price. The main objective of this study was to assess the effect of freight transport service performance on international trade competitiveness. A descriptive research design was used. Secondary data were collected from international organizations' policy, standards documents, and annual report of the year 2018 by using the Logistic Performance Index rank. Moreover, a quantitative research approach was applied. The data were entered, manipulated, organized, and analyzed using Excel and Statistical Package for Social Science. Both descriptive and inferential analyses were used to identify and examine the extent of international trade competitiveness and its implication in the global market. As the result reviled the entire logistic performance factors such as Growth Domestic Product, Distance, Infrastructure, Landlocked, and Timelines were found to be significantly important to determine the global market competitiveness. But, the geographical distance between bilateral countries affected a country’s trade negatively. The top 10 higher Logistic Performance Index scores more competitive and better implementer of the effects of freight transport factors; whereas, the bottom scorers had an ineffective market link with their partners.


Wiegmans BW, Nijkamp P, Masurel E (2001) Intermodal Freight Terminals: Marketing Channels and Telecommunication Networks. Transport Reviews, 21: 339-413. DOI: 10.1080/014416401753114260

Banomyong R, Beresford AKC (2001) Multimodal Transport: The Case of Laotian Garments Exporters. International Journal of Physical Distribution and Logistics Management, 31: 668-685. Doi:

Konings, R., Priemus, H., Nijkamp, P., & Edward Elgar, 2008. The Future of Intermodal Freight Transport. Operations, Design, and Policy. Transport Economics, Management, and Policy. Edward Elgar Publishing Limited, USA. DOI: org/10.1080/00330121003600934

Regan AC, Garrido R (2001) Modeling Freight Demand and Shipper Behavior: State of the Art, Future Directions. Travel Behavior Research, pp 185-215. DOI: 10.1016/B978-008043924-2/50006-7

Tseng Y, Yue LW, Taylor P MA (2005) The role of transportation in the logistics chain. Proceedings from the Eastern Asia Society for Transportation Studies, 5: 1657-1672.

Mauro B (2018) Trade Linkages between the Belt and Road Economies. Policy Research Working Paper, 8423, Macroeconomics, Trade, and Investment Global Practice. doi:460281525178627774/WPS8423

Jesudason JV (2020) The Developmental Clienteles State: The Malaysian Case. Humboldt Journal of Social Relations, 23: 147-173. DOI: stable/23263493

Feo-Valero M, Espino-Espino R, García-Menéndez L (2011) An stated preference analysis of Spanish freight forwarders modal choice on the South-West Europe Motorway of the Sea. Transport Policy 18: 60–67. DOI: 10.1016/j.tranpol.2010.05.009

Faye ML, McArthur JW, Sachs JD, Snow T (2004) Challenges Facing Landlocked Developing Countries. J. Hum. Dev. 5(1):31-68. DOI: 10.1080/14649880310001660201

Henderson J V, Shalizi Z, Venables A J (2001) Geography and Development. Journal of Economic Geography, 1: 81-105. DOI: 10.1093/jeg/1.1.81

Rabiy H, Edward K (2016) Analysis of Transport Logistics Challenges Affecting Freight Forwarding Operations in Malawi. African Journal of Business Management, 10: 607-614. DOI: 10.5897/AJBM2016.8218

Arvis J-F, Lauri O, Ojala L, Wiederer C, Shepherd B, Raj A, Dairabayeva K, Kiiski T (2018) Connecting to Compete 2018: Trade Logistics in the Global Economy--The Logistics Performance Index and Its Indicators. World Bank, Washington, DC. DOI: 10.1596/29971

Baird A.J (2007) The economics of Motorways of the Sea, Maritime Policy and Management. The flagship journal of international shipping and port research, 34: 287-310. DOI: 10.1080/03088830701538976

Grosso G M, Kyvik NH, Ueno A, Gonzales F, Lejarrage I, Miroudot S, Rouzet D (2014) Services Trade Restrictiveness Index (STRI): Transport and Courier Services. OECD Trade Policy Papers, No. 176, OECD, DOI: org/10.1787/5jxt4nd187r6-en

WTO–Economic Research and Statistics Division., last accessed 2019/01/17

Hummels D, Schaur G (2012) Time as a Trade Barrier. Cambridge, MA: National Bureau of Economic Research, 103:935-59. DOI: 10.3386/w17758

Hausman HW, Lee LH, Subramanian U (2012) Logistics performances can significantly impact bilateral trade relations between trading nations. Production and Operations Management, 22:236-252. DOI:org/10.1111/j.1937-5956.2011.01312.x

The World Economic Forum and the Global Alliance for Trade (2016)., last accessed 2019/03/12

Elena-Daniela, 2012. Econometric Estimation of a Gravity Model for the External Trade of Romania. Alexandru Ioan Cuza University of Iaşi, Iaşi, Romania. Journal of Eastern Europe Research in Business and Economics, 2012 (2012), Article ID 854058, 9 pages DOI: 10.5171/2012.854058



How to Cite

Fikru, E. (2021). The Effect of Freight Transport Service Performance on Global Market Competitiveness . Studies in Economics and Business Relations, 2(2).