I interviewed Rudolf Rosas Flunger who discussed The Biggest Challenges of Logistics in Brazil.
It’s good to have this interview today with you, Rudolf. Today I’m looking forward to hearing your views on the biggest challenges of logistics in Brazil. Can you start by providing a brief background of yourself?
Yes, good morning. I’m a management consultant who has been working in Latin America for the past 20 years, addressing issues in strategy and supply chain specifically, working in Brazil most of the time but also in other countries in Latin America—Colombia, Argentina, Peru, and so forth.
What do you feel are the biggest challenges for logistics in Brazil?
Today if we can summarize, we can focus on two big issues. One is bureaucracy and second one is infrastructure. First one, bureaucracy, is taking a lot of effort and taking a hit on cost, also, for logistics and operations in Brazil. What we call bureaucracy is the whole processes that have to do with complying with regulation and with state requirements to make all logistics and all transportation and import processes. And then when we talk about infrastructure, we see a lack of sufficient investment in infrastructure needed for the logistics operations here in Brazil. We are talking about ports, roadways, and other models, like railways and even inland shipping.
Can you explain why these problems exist?
First, in terms of bureaucracy, as we know, even if Brazil has been very active in import-export in international trade more recently, it has been conditionally kind of a closed country with a lot of barriers in terms of regulation, tariffs—not only tariffs, but also in terms of regulations. It’s, again, a very protective country. We come from a history of trying to develop the local industries. This is one of the main reasons for bureaucracy. And we have, also, kind of an approach that has been very bureaucratic in even other things in Brazilian day-to-day life. Secondly, when we talk about infrastructure, what we see is a line in terms of investment. When we look at the investment as percentage of GDP, different structure, investment in here has been very low. The result of this is not sufficient infrastructure.
And how would you address these problems effectively?
First, to address the bureaucracy issue, I understand two approaches. The very first one should be a simplification of regulations, laws, and all processes that have to be done to comply with government. The second approach with bureaucracy should be improving processes and technology that are available to make all this transit. In terms of infrastructure, there are also two approaches. The very first one, obviously, is increasing the amount of resources that are allocated for investment in infrastructure. Secondly, improving, also, the quality of this investment. That means making a good plan on what you will be investing in and also how you make this investment in infrastructure.
Thank you, Rudolf, for sharing your views today on the challenges of logistics in Brazil.
Okay, thank you very much.
About Rudolf Rosas Flunger
Rudolf Rosas Flunger
Managing Partner, Flunger & Company