128. The transportation sector refers to land transport (roads and rail), air transport (airports, navigational facilities) and marine transport (inland waterways and associated ports, coastal ports and navigational facilities). The logistics sector refers to activities associated with the storage, movement and distribution of goods and commodities.
129. Transportation and logistics can be seen as existing along a continuum with some projects, air navigation facilities for instance, clearly falling into the transportation sector while projects such as logistics zones are more properly described as belonging to the logistics sector. However, there is a degree of overlap with projects such as freight storage and distribution facilities and ports having characteristics of both a transport and a logistics nature. For this reason, transportation and logistics will be considered together.
130. The transportation and logistics sectors are central to MENA governments' development agenda, as they are conducive to accelerating economic expansion through export-led growth and regional integration, creating jobs and reducing poverty and exclusion. It is estimated that within infrastructure services, the transport and communication sectors are the biggest employers, representing jointly about 7% of the total employment - with wide variations across countries, while energy and water sectors account for approximately 1%18.
131. With some notable exceptions such as Yemen and Djibouti, transport systems throughout the MENA region are relatively well-developed (World Bank, 2010). Most countries have extensive road networks, with high capacity in some areas. They also have important facilities for air and sea transport, and, in several instances, a sizable rail network: in Algeria, Morocco, Tunisia and Egypt, for instance, the railway plays a significant role in passenger and freight transport.
132. However, transport infrastructure quality is often inadequate to support growing economies. Inadequate design of road networks, poor quality of public transport, weak institutional and legal frameworks, unsatisfactory enforcement of traffic regulations and shortcomings in information and education contribute to poor performance in both urban and rural transport infrastructure. There are serious capacity gaps and multiple constraints to regional transport. Furthermore, congestion is a growing and serious problem in most large urban areas.
133. Throughout the MENA region, infrastructure investment and rehabilitation needs are likely to be especially high in the transportation sector, particularly roads. This sector alone is estimated to account for about 43% of total infrastructure needs in MENA, followed by energy, information and communication technology, and water and sanitation19. Some of the priority areas of focus include:
• Urban transport: The MENA region is far more urbanised than East Asia or South Asia, with around 60% of its population living in cities20. This involves deep socioeconomic transformations in most cities, and rapid growth in urban transport demand and in motorisation. Yet the development of (public) transport systems is lagging, and excessive
• Rural access: For most MENA countries, especially those with a large rural population such as Morocco, Egypt, and Yemen21, all-weather access in rural areas is limited by poor road networks and the inadequacy of basic transport services. Expanding rural access to transport is critical for accessing markets, health centres and schools, and other social and administrative services.
• Intermodal connectivity: Intermodal freight transport involves the transportation of freight in an intermodal container or vehicle, using multiple modes of transportation (rail, ship, and truck), without any handling of the freight itself when changing modes. The method reduces cargo handling, thus improving security, reducing damage and loss, and allowing freight to be transported faster. Reduced costs over road trucking are the key benefit, as well as reduced greenhouse gas emissions. This may be offset by greater speed for road transport over shorter distances.
134. In order to meet growing transport needs in a fiscally constrained environment, the private sector has an important role to play. Traditionally, transport infrastructure and service provision in the MENA region has been dominated by the public sector. Throughout the 1990s, most MENA countries set out to encourage private participation in infrastructure development. These efforts should be sustained and expanded through adequate policy and regulatory frameworks. While institutions in charge of transportation and logistics are generally in place, there remains a gap in policy formulation and management capacity. Regulatory and financial systems also need development.
135. Transportation and logistics are pivotal in fostering regional trade integration. Poorly performing transport infrastructure and services in the MENA region have adversely affected trade flows through high costs, delays and uncertainty. Over the past decade, the MENA region has lost global market share in many exports sectors, and non-oil exports represent just one percent of world trade, which is the lowest share of any developing region (World Bank, 2010). To address this, governments need to improve geographic coverage, intermodal connectivity, quality and capacity to accommodate traffic flows.
136. Transportation can also make a stronger contribution to socioeconomic development by improving the access of the urban and rural population, especially the poorest, to public services and economic activities. Special attention should go to areas such as road safety, women's empowerment and accessibility for persons with reduced mobility.
137. Finally, climate change mitigation is of particular importance in the MENA region. Although MENA GHG emissions are less than 6% of the world total for the transport sector, some countries (mainly oil producers) are among the highest emitters in the world per capita22. Thus governments will need to adapt the transport sector to climate change, and promote alternative modes (e.g. Nile river transport in Egypt). In Morocco, for example, natural disasters have damaged transport infrastructure and disrupted services, inflicting serious costs on the economy. Floods have also been made worse by design flaws in transport infrastructure.
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18 . Estache, Antonio, Elena Ianchovichina, Robert Bacon, and Ilhem Salamon (2013), Infrastructure and Employment Creation in the Middle East and North Africa. Washington, DC: World Bank.
19 . Ibid.
20. Eight of the region's cities have more than 3 million inhabitants. reliance on private automobiles leads to record-high traffic congestion, reduced mobility, and deteriorating air quality, while affecting cities' competitiveness and economic growth.
21. With only 22% of the rural population living within 2 km of an all-weather road, access in Yemen is equal to some of the poorest countries of the world (World Bank, 2010).
22. Of all the regions of the world, MENA has the highest GHG transport emissions per unit of GDP, about 150 tons CO2 per USD million of GDP, roughly the same as North America (World Bank, 2010).