30th IRU World Congress Dubai, UAE 14-16 March 2006

Congress Highlights - Opening Ceremony - Tom Donohue

Tom Donohue
President of US Chamber of Commerce, USA
Opening Ceremony
Dubai, 14 March 2006

Good afternoon. I’m grateful for the opportunity to address the International Road Transport Union World Congress – though I am disappointed I couldn’t join you in person.

I regularly attended IRU meetings during my thirteen years as head of the American Trucking Associations.

I still have a love for the industry and the people in it, and my job at the U.S. Chamber demands that I pay close attention to transportation issues.

The explosion in global trade and growth of the global economy requires that our transportation systems be efficient and safe.

Though the Chamber is 100% committed to strengthening all modes of transportation – rail, roads, air, and sea – it’s the challenges and opportunities that we face in highway transportation and the trucking industry that I want to talk about today.

Trucking is favourite target of environmentalists and anti-growth activists worldwide. While freight carried on rail, ship, and plane largely goes unnoticed, trucks operate in places where people are…in our cities, on the roads we travel on, and in our neighbourhoods.

It’s essential that we reinforce to policymakers and to the public the importance of trucking to the economy and our way of life.

In the United States, trucking is the most used mode of freight transportation. In fact, 70% of the value of all freight in the U.S. is hauled by truck. In 2002, the trucking industry transported more than $9 trillion worth of shipments, weighing over 11 billion tons.

In addition, one-fifth the value of merchandise that moved in and out of the United States in 2002 was transported by truck.

While some trucking issues differ from country to country, there are two that affect all of us to some degree. One is investment in infrastructure and the other is the balance between mobility and security.

Let me talk first about infrastructure. A well-built network of roads and highways creates goods jobs, enhances mobility, improves productivity, and helps reduce congestion and emissions.

In addition, a good highway system and substantial trucking capacity are important in times of emergency. When natural disasters or terrorists strike, trucks need to be able to deliver relief and move people and goods quickly out of harm’s way.

However, globally, infrastructure investment is not keeping pace with the explosion in the movement of people and goods. Nowhere is that more evident than in the United States.

Consider these statistics:

In the United States, truck vehicle-miles-of-travel doubled over a 20-year period and is forecasted to double again in the next 20 years.

Between 1980 and 2002, the number of trucks used in commercial transportation increased by more than 2 million – a 37 percent increase.

In that same time period, truck travel grew by more than 90 percent while public road capacity, as measured by lane miles, increased by only 5 percent.

We’ve reached the point where our current highway funding mechanism is not sufficient to meet our growing needs.

The U.S. has a user-fee based system -- the people who use the roads are the ones who pay for them. Our government collects revenues from highway users through federal and state fuel taxes and other fees and deposits the majority of that money into a Trust Fund.

It’s a system that has served us well for a long period of time – since the Eisenhower Administration, in fact.

But because of more cars and trucks on our roads and fewer gas tax dollars going into the trust fund because of rising fuel efficiency, our current highway financing system is unsustainable.

In fact, in the next 25 years, we will fall $40 billion short of what it will take to simply maintain our roads and transit systems.

And we will fall $3 trillion short of the cost of improving our roads, bridges and transit systems.

And so the Chamber is leading a discussion on additional highway funding mechanisms…everything from an increase in toll roads and more private financing to an increase in the gasoline tax.

A Chamber study on transportation financing released last year even looks at the implementation of a vehicle mile tax - as Germany has adopted for its trucking industry.

The Chamber is also engaged in the development of reliable, safe, and secure transportation networks around the globe.

As many of you know, we are working with the IRU to revitalize the land bridge between China and Europe—the historic “Silk Road.”

The IRU has shown, with its Beijing to Brussels caravan last September that creating this link is logistically possible.

Now, we are studying whether it is commercially feasible to bring goods from China to Europe over land.

We’re doing this for a few reasons.

One is because both Europe and Asia are important investment locations for U.S. multinationals—most of whom are Chamber members - and finding a faster and cheaper transport route would be good for business.

Second, there is real potential for increased investment and infrastructure development along the trade route.

And finally, the region that encompasses the historic ‘silk road’ is valuable economically and is pivotal for global security.

It’s important that we develop these routes in such a way that protects the environment and creates a system of values that ensures that only legal and safe products are shipped.

Let me say a quick word about security. The Chamber is working to ensure the right balance between security and the free flow of commerce. There are ways to protect ourselves against terrorist threats without slowing down the economy.

With regards to trucking, The Chamber has been actively working with the U.S. Department of Homeland Security to rid our system of credentialing, application and background check processes that are duplicative and costly—and that make no distinction between those hauling potentially dangerous items like weapons and those hauling mouthwash and cola syrup.

Technology, good risk assessment, and commonsense will keep us safe, yet mobile.

Ladies and gentlemen, the issues I’ve raised won’t be resolved without private sector involvement.

We can’t expect government to do the right thing. It’s up to us to make a strong case for why investment in roads, highways, and bridges and a balance between mobility and security are an investment in our economic future.

That’s why the Chamber leads a coalition, Americans for Transportation Mobility—made up of more than 300 local policymakers, chambers of commerce, labour unions, and transportation users and providers.

The coalition is committed to raising awareness of the importance of transportation investment among the public and lawmakers.

I hope that business organizations all over the world are equally committed to meeting our road transportation challenges. Thank you very much. Have a great meeting.

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