Industries, technology and institutional connections in transport — a rant

While transport markets grow, the data does not reveal complexities of development. Institutions need to be more proactive and aggressive in a hyper innovative world.

A recent article from the CNBC reveals some notes on the symmetry in transport market growth after US elections. The commentators argue that this is influenced by the infrastructure development led economy promised by US President, Donald Trump. Purporting that markets may well be responding to a scene set for growth in rapid, integrated and hyper-seamless transport preferences from industries and consumers.

A number of countries are focusing deeply on strategically navigating through long term ambitions for clean industrial development. In South Africa, this is represented by the Green Industrial direction and manufacturing incentives devoid from service implications — but good for the economy. In the UK this is represented by the Draft Industrial Strategy which is currently (2017) a hot topic as it provides an integrated framework of interventions across sectors (some shortfalls are evident though). Meanwhile Tesla and many other entities are leaning toward large scale clean energy solutions across the energy value chain.

However, these may be fruitless efforts if institutional capacity is not activated to act upon such drives. Cases of transport reform in metropolitan regions across Africa reveal that a key instrument to facilitating interventions is agency-making. From Morocco, through Tanzania, Kenya and South Africa the importance of representative agencies are fundamentally a springboard for guided and focused action along a narrow policy gauge. Evidently, this is different from the BRT mantra around entity-making as entities lack policy and political prowess while retaining some degree of corporate sovereignty — though influenced and dependent on public and international financing.

There is an evident shift toward a new mobility industry which is catalised by improvements in technology, technical expertise and partnership based innovation. Traditionally one may expect markets to contract marginally as fuel prices increase when discounting the impact of aggregate growth in other factors. (i.e. population, per capita income etc). However, oil prices are returning to their 2015 nominal price points according to NASDAQ indices, while transport markets seem to be gearing up for a different era of mobility. In my view, there is substantial evidence that transport industries are gearing toward reducing unit operating costs as carbon emissions become more discouraged. Lower transport costs unbundle household expenditure attached foodstuffs, access and mobility. This may initially reduce debt, but should translate into greater savings and or more consumption — households differ.

It is thus not only a question of energy, but rather a shift across the totality of industry, operations and services in transport. Each one provides a concomitant sequence of intervention spectrums requiring some deep shifts in regulatory infrastructure and what WheresMyTransport teams call ‘infostructure’. On an industrial scale, industries are not just growing but seem to be diversified in such a manner that up and downstream components are consolidated. This ranges from auto manufacturers preparing shared mobility solutions, and thus expanding their business models more deeply. It also involves the consolidation of transport technologies as part of the business, not an outsourced activity that is specialized. This process of consolidation is part and parcel of the internalization of the multidisciplinary nature of contemporary thought, strategy, culture and practice. Not only is this tied to Globalisation and its Discontents, but it also follows the narrative of the Earth Institute’s framework for reform presented by Jeffrey Sachs.

“The main message of Globalization and its Discontents was that the problem was not globalization, but how the process was being managed. Unfortunately, the management didn’t change. Fifteen years later, the new discontents have brought that message home to the advanced economies.”- Joseph Stiglitz

I’ve described the importance of relationships in the commercial transport application industry, and a need for tech-companies to understand and account for their upstream and downstream ripple effects in transport markets. At the heart of the article was that no entity operates in a vacuum and institutional infrastructure reforms are crucial for the appropriate coordination of “disruptive” interventions. At this point, I have to come to terms with the industrial and system wide implications of a very complex set of changes weaved in our lifetimes. However, I must question the value of growth itself as an aggregate measure against other metrics that bellow beneath the armpits of self-correction and nation building. Development is the currency for change, but for now I’ll end off by saying:

If the rapid nature of innovation, technology and synergy persist without being lead by institutional reforms and pathways industries will thrive in irreversible directions. The capital outlays are en route and this short window of opportunity to prepare for the next generation may well be valuable but futile in the long term. Especially where changing direction would be like bending a highway after land-use and mobility has already oriented around it. Before mobility hovers above and rumbles below, standards and policies need to be forthcoming, aggressive, non-contradictory and proactive. Reconnecting industry and service will be the difference between value and meaning, growth and development, income distribution and equity. Yes, the growth is real, good and well — but it is only a small part of a broader narrative.

For a number of reasons, I believe that the African continent is an intersection, an interesting position to catalyze development. Not be a sucker for growth-only logics but real meaningful action. This requires active and aggressive forethought and intervention at institutional level. Specifically to reconnect industry, service and perhaps place technology somewhere in between.

Thank you for reading.


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