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Can Ukraine disrupt the global logistics industry?

Henry Shterenberg
President of the World Trade Center Kyiv

How do you know when an industry is ripe for disruption? To answer, we must consider two factors: the current level of disruption in the industry and its susceptibility to future disruption. A quick look at the logistics sector, and the answer to both these questions makes it very clear: global logistics is ripe for disruption.

Two black-swan events are evidence that the industry is ready for a major makeover:

· A single container ship in the Seuz Canal disrupts economies around the globe.

· The COVID pandemic shines a spotlight on every possible gap in the global supply-chain.

Well, as I recently learned from Emma Arakelyan, a brilliant lady whom I had the pleasure to meet at the recent Horasis Extraordinary Meeting, there are negative black swans and positive black swans. Yes, positive! Never forget, every crisis is an opportunity to learn and to disrupt the "old guard."

Ukraine, with its massive infrastructure of roads, rail, and river-, sea- and airports, in the center of Europe, is ideally positioned to remake the global logistics and supply-chain industries. As a first step towards this massive opportunity, at WTC Kyiv we are already identifying underused infrastructure (such as out-of-use airports) and infrastructure ready for redevelopment that can leapfrog to new Smart technologies.

Developing flexible manufacturing centers in industrial parks in proximity to new logistical hubs will be 3 to 5 times less costly in Ukraine than in the U.S. or Europe. Operational efficiencies will be greater, and costs lower, all due to new foundational technologies—AI, blockchain, augmented reality, robotization and automation. A well-planned nation-wide network to connect industries and geographies will further improve efficiencies across the system.

Ukraine has a real chance to become an intelligent logistical hub to the world within the next 10 years, creating an economic boom for the country. But this is more than an opportunity for Ukraine; it’s an opportunity for forward-looking companies and investors around the world to create Global Logistics 2.0.

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