European migration crisis costs at least $1 billion in shipping disruption

5 November 2015

BSI Supply Chain Security Risk Index reveals European trade slowed by most serious border delays in 20 years 

Essential shipments of goods and medical supplies are being delayed and destroyed as a result of the European migration crisis, costing a collective $1Bn to the UK economy in the last year alone. The latest BSI Supply Chain Security Risk Index shows that, in September, Europe saw the highest number of border closures since the signing of the Schengen Agreement in 1995. With the number of families and individuals displaced by war across Africa and the Middle East growing 50% year on year, BSI warns that costs to international shippers will continue to rise. 

The BSI Supply Chain Security Risk Index is based on data from BSI’s Supply Chain Risk Exposure Evaluation Network (SCREEN) which provides continuous evaluation across more than 20 proprietary risk factors in 203 countries. The report highlights that closures at Calais add an estimated $1.2M each day to the cost of those transporting goods to the UK with delays of nine hours or longer, while border closures in Southern Germany, Serbia, Croatia and Hungary have hit shipping firms hard. Food and pharmaceutical shipments are worst affected, with an entire shipment of medical supplies worth $3.9 million having to be destroyed after stowaways broke into the container. 

Jim Yarbrough, Global Intelligence Program Manager, at BSI Supply Chain Solutions commented:

“More so than any other economic bloc, Europe relies upon free trade. Every shipment delayed, contaminated or destroyed, raises the cost to the end-consumer. For exports this hurts competitiveness, undermines productivity and risks jobs; for imports it raises the cost of living for each and every citizen.” 

Supply chain disruption, delays, theft and loss of goods in transit are global problems, and are not just restricted to Europe. According to the BSI Supply Chain Security Risk Index, South Africa has seen a 30 per cent increase in violent hijackings over the last year, with thieves switching from targeting only high-value goods such as cigarettes to lower-value items such as clothing as well. 

Daring vehicle shipment thefts are becoming increasingly commonplace in China, with a recent spate of moving vehicle thefts. Here criminals are deploying tactics straight out of Hollywood movies, as they board speeding trucks and pass down stolen goods to their accomplices. $55,000 of pharmaceuticals were stolen in this fashion in July, with a further $40,000 worth of leather goods stolen the following month. BSI’s Supply Chain Security Risk Index provides a risk map with some of the most dangerous areas for such thefts. 

Yarbrough concludes:

“Economic volatility and uncertainty in markets such as South Africa and China is creating an ever more serious criminal threat to goods shipments. Highways such as the G45 north of Guangzhou are becoming notorious for ‘kaitianchuang’ thefts, where criminals leap aboard speeding lorries in scenes reminiscent of action movies. Even more violent tactics are seen in South Africa. While it is most often high value pharmaceuticals or electronics targeted in these well-planned raids, the trend is moving toward lower value goods. Effective supply chain planning can help firms route around such dangers, and make sure back-up supplies can be swiftly located if the originals are looted.” 

To request a copy of BSI’s Supply Chain Security Risk Index Report, please click here.

About BSI

BSI (British Standards Institution) is the business standards company that equips businesses with the necessary solutions to turn standards of best practice into habits of excellence. Formed in 1901, BSI was the world’s first National Standards Body and a founding member of the International Organization for Standardization (ISO). Over a century later it continues to facilitate business improvement across the globe by helping its clients drive performance, manage risk and grow sustainably through the adoption of international management systems standards, many of which BSI originated. Renowned for its marks of excellence including the consumer recognized BSI Kitemark, BSI’s influence spans multiple sectors including Aerospace, Automotive, Built Environment, Food, Healthcare and ICT. With over 80,000 clients in 172 countries, BSI is an organization whose standards inspire excellence across the globe.  

To learn more, please visit www.bsigroup.com

About BSI Supply Chain Solutions
BSI Supply Chain Solutions is the leading global provider of supply chain intelligence, auditing services, audit compliance and risk management software solutions, and advisory services. Our mission is to help corporations, governments and associations identify, manage and mitigate global supply chain risks and maintain world class governance risk and compliance programs.  Our holistic supply chain risk management suite is designed to predict and visualize risk, and develop robust risk mitigation and compliance management programs to protect your supply chain, brand and reputation. Our intelligence-infused supply chain solutions and global network empower our clients to understand global supply chain risk with unequaled precision. 

To learn more, please visit www.bsigroup.com/en-GB/supply-chain-solutions/

Media inquiries:

Shereen Abuzobaa

BSI Supply Chain Solutions

Tel: 703-464-1931

Email: shereen.abuzobaa@bsigroup.com

Kara Martin

BSI Supply Chain Solutions

Tel: 480-448-7278

Email: Kara.Martin@bsigroup.com