The cost of controls

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Europe is discussing the temporary suspension of the Schengen Agreement – with fatal consequences for the economy “Up to two hour delays for clearance at the german border near Füssen” – these are the kinds of statements that were often heard on radio traffic services in the eighties. But ever since the Schengen Agreement came into force, they were supposed to be a thing of the past. And indeed, traffic congestion at European borders is usually due to heavy traffic. But the current wave of refugees and the now implemented shutting of the Balkan route have raised fears that long tailbacks at border checkpoints and time-consuming truck clearance may once again become reality. So what impact will this have on the logistics industry? Will cargo prices now go through the roof due to the additional costs? Will entire supply chains break apart? In any case, it’s going to be a costly affair. The permanent control of the southern border crossings alone would cost the Austrian transport economy EUR 8.5 million every day. That’s what the Austrian Chamber of Commerce calculated, based on the long waiting times before clearance, as they actually have to be paid as normal working time. And these additional costs will almost certainly have an effect on freight rates. For the economy as a whole, the German Prognos AG paints an even gloomier picture. On behalf of the Bertelsmann Foundation it determined losses in economic growth of between EUR 77 and 235 billion until 2025. And that concerns Germany alone. For the EU as a whole, GDP losses could amount to roughly EUR 470 billion. A true nightmare scenario. Little wonder that the industry is hoping for other solutions. Experiences by DHL Freight in the UK show how much the refugee issue has already affected transport logistics: “The problems at the English Channel crossing between Dover and Calais have seriously affected the UK. Many import supplies for our customers are significantly delayed. Nevertheless, our team has managed to maintain a high service level and high level of availability of the vehicles. Other side effects include rising insurance premiums due to damage to cargo and vehicles caused by refugees. Furthermore, our drivers are put into difficult situations time and time again when having to cross the Channel”, explains Niel Kinnear, Sales Director UK. Therefore, if the worst comes to the worst, namely if the Dover-Calais border is completely closed, emergency scenarios have already been discussed with larger clients. Europe-wide checks will thus certainly require further adjustments.