The challenges faced by the logistics industry amid the global uncertainties and disruptions to global supply chains, and solutions in the application of new technologies such as AI were discussed as an international logistics congress opened in Portorož on 27 March.

The logistics industry is an important part of the Slovenian economy, generating about 8% of the country's GDP, and efficient logistic processes make the whole economy more competitive, Economy Minister Matjaž Han told the three-day congress, which is being attended by 600 participants from 25 countries.

Good geographical position not enough

The current geopolitical situation poses major challenges for logistics companies, and it is important they establish alternative supply routes. "I see that some of you here are also looking at alternative supply routes. I find this is very important in the given geopolitical situation," Han said.

The industry is also facing the urgency of a digital and green transition. "This is where the state is not doing enough," Han admitted, but added that the government was trying to help companies as much as possible to meet these challenges through various measures.

He mentioned calls that are being prepared by his ministry in cooperation with the SID Bank and the Slovenian Enterprise Fund which will make more than EUR 850 million in loans and grants available to companies, including in logistics, this year.

He pointed to Slovenia's geostrategic position as a gateway to the European market as a major competitive advantage. Slovenian companies have utilised it very well, but Han believes there is still a lot of untapped potential.

"A good geographical position means nothing if logistics are not linking and adapting to the situation. It is the only way to be better," said Melita Rozman Dacar, director of the freight arm of the Slovenian Railways, who won the logistician of the year award. She pointed to cooperation projects in the region.

"The [Slovenian logistics] industry comprises 9,200 companies with more than 50,000 employees moving across borders 24 hours a day, seven days a week," she said, happy that the importance of logistics has been recognised by the government. "There is a lot of investment, a lot of new challenges," she said.

Supply chain disruptions to continue

Organised by the Slovenian Logistic Association, the 11th congress is focusing on supply chain management in science and practice, with the association's president Igor Žula pointing to the importance of cooperation in the region.

Nick Vyas, the founding executive director of the Marshall Randall R. Kendrick Global Supply Chain Institute at University of Southern California, spoke about key trends and the future of the industry.

After the Covid pandemic, which tested the resilience of supply chains at times of global crises, uncertainties remain, he said, pointing to wars raging in the neighbourhood and attacks on ships in the Red Sea turning a once vital shipping route into a dangerous area.

Vyas expects disruptions in supply chains to continue. Whether due to existing or new geopolitical conflicts, inflationary pressures, weather disasters as a result of climate change or other causes that could yet materialise.

However, he did not mean to scare the participants. "I'm not suggesting that we start manufacturing everything in Slovenia or Europe," he said. The world will continue to be linked through global trade, but all actors in supply chains will have to be more vigilant, he said.

AI, blockchain technology

Vyas sees the future of the industry in new technologies, innovation and closer integration between stakeholders. With the rapid advancement of technology, new opportunities are opening up to optimise processes and ensure a more efficient, sustainable and integrated supply system.

He argued that the industry should start thinking about how to take advantage of blockchain technology, which, among other things, improves the security of data transmission within the supply chain, as well as the use of artificial intelligence. However, he said that the human potential should not be neglected.

One example presented is the use of AI in container management at the Koper port, which the operator Luka Koper hopes will reduce the number of unproductive movements, which in turn reduces costs and increases cargo throughput.

Speakers at one of the round tables agreed that the transition from paper documents to electronic data exchange makes significant savings possible in time and money, but also pointed to the issue of trust, given the sensitive nature of the information involved. There, governments need to set standards.

Representatives from companies such as Nestle and PepsiCo will be speaking about examples of cooperation to improve logistics services, reduce costs and consolidate distribution, while the conference will also feature lectures such as on robotic warehouse management systems.