Physical Connectivity is closely associated with economic activities and trade as the prime mover .
extent that the mutual exchange of goods is an indirect exchange of human capital , technology and other production factors , growth and bilateral connectivity can , therefore , be expected to correlate , and self-reinforcing , dynamic growth forces can come into play .
Road Freight Transport – World Bank
In most regions , road transport ( trucking ) is the dominant transport mode for moving freight along corridors . More than 80 % of overland trade traffic is by road , and nearly all trade freight is carried by road at some point . Efficient delivery of road transport services is hence essential for the unimpeded movement of freight and people along corridors .
Trade performance depends on efficient road services everywhere in the world . It is particularly important for developing countries , especially landlocked ones because roads provide the main connectivity links to the sea . For many of these countries , road transport is often the only available mode for moving freight . Even in landlocked countries that have rail or waterway connections , the volume of freight using rail or waterways is rarely sufficient to make them financially sustainable .
Road infrastructure is one of the most important factors that can affect the performance of trade and transport corridors . It often is a top priority among investments in developing countries , partly based on the assumption that investments in road infrastructure alone will significantly reduce transport prices .
However , with a few exceptions , inadequate road infrastructure is no longer the main binding constraint to cross-border trade at any corridor level . Although investments have improved roads , facilitating road transport and reducing the transport costs for trucks , end-users of transport services have not benefited much from these improvements in some regions .
Transport cost and prices ( rates ) are two other important factors influencing the choice of a route or a mode . Transport costs can be perceived as the fixed and variable input costs of providing road transport services . Transport prices are a function of transport costs and any margins added by operators . The margins are in turn a function of market structure , political and economic factors in the market . It is not unusual for transport prices to be different on domestic and international corridors , reflecting the dynamic interaction of these various factors .
Transport and transit rights granted by countries along a corridor to other countries ’ transport operators are also paramount for the success of the corridor , as they translate into mutual market access rights .
Prime Mover of Physical Connectivity
Physical Connectivity is closely associated with economic activities and trade as the prime mover . Malaya ’ s early railway network stemmed from the need by the British Administration to transport commodities from the interior of Peninsular Malaya to coastal ports for shipments to the West .
As the expansion of infrastructure works takes place to accommodate the massive movement of people and goods , there is an emphasis globally on environmental sustainability vis-a-vis the financial implication of the nations concerned .
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