The Hidrovia Parana-Paraguay Case
Executive Summary
The Hidrovia Parana-Paraguay is one of longest natural waterways on the planet, covering 3442 km (2150 ml) across 5 countries (Bolivia, Paraguay, Brazil, Argentina and Uruguay) with estimated area of influence of 3,500,000 km² (1,351,357 ml²) which is equivalent in size to two states of Alaska and has a population of almost 20 million inhabitants
It represents one of the most significant transport routes for the physical integration of the Mercosur. The agreement between the countries involved, facilitates the navigation, commercialization and trading. Along this route, relevant commodities, such as soybean and iron ore, gain access to the global markets.
Bridging Value is the innovation firm with global connections across North America, Latin America and Europe focused on the Transformation of the Energy Matrix. We design, engage and manage business ecosystems around global challenges. Transportation is a relevant vertical within our Mobility approach/analysis.
We have analyzed and envisioned 15 opportunities and challenges that should be tackled to transform the Hidrovia Parana-Paraguay into a main logistic route for an economical and sustainable development for the Mercosur.
We have developed a proprietary analysis model, in which the above-mentioned opportunities were ranked according to 7 variables highlighting the most attractive areas of development.
Our overall vision is to establish a virtuous innovation cycle deploying specific local solutions integrated in a regional vision aligned with the most advanced technologies.
At Bridging Value we are fostering the formation of a consortium of entities including North and South American Universities, private Corporations, Chambers of Commerce and specialized Start-Ups to lay the foundation of a Regional Innovation Exchange Catalyst.
This Catalyst will generate multiple business opportunities connecting local and global businesses supporting the establishment of new industries and laying the groundwork for new technologies to be developed, tested and implemented which will lead to positive impacts along the entire region.
The Hidrovia Parana-Paraguay
The Hidrovia Parana-Paraguay is one of longest natural waterways in the planet, covering 3442 km (2150 ml), 5 countries (Argentina, Uruguay, Brazil, Paraguay and Bolivia) with almost 20 million inhabitants across 3,500,000 km² or 1,351,357 ml²
It represents one of the most significant transport routes for the physical integration of the Mercosur. The agreement between the countries involved, facilitates the navigation, commercialization and trade across the region.
All 5 countries rely on the waterway to export their commodities from the inland. Bolivia and Paraguay rely on this waterway as their main access to International Ocean Freight.
Today there are over 110 ports (21 of them Public ports while 89 are Privately owned) along the Hidrovia, moving a total of 700,000 Tons in 1988 growing to 17,4 Mn tons in 2010 and between 25 to 36 Mn tons in 2020. Additionally there are at least 2850 vessels transiting these rivers.
The Hidrovia is a channel of commerce: in Argentina, 100% of automotive exports/imports, 99% of Containerized cargo and 65% of agro exports flows through the Hidrovia. While Bolivia currently depends primarily on ports in Chile and Peru for it’s imports and exports. There has been significant investments in developing new ports which can shift these traffic volumes to the Hidrovia, increasing dramatically the usage while reducing shipping costs. In the case of Paraguay the waterway is used to move more than 80% of its export and has the 3rd biggest river fleet in the world. The Hidrovia Parana-Paraguay could impulse the logistics Hub idea for Paraguay to be the interconnection between the inland and the ocean
Soy, Wheat, Corn are among some of the major food commodities while Iron Ore is one of the largest minerals shipped across the waterway.
Based on current infrastructure, regulations and resources, there are many improvement opportunities to grow the projected volume transported along the waterway by 70%, develop and generate social impact and generate cost reductions while taking into consideration all stakeholders and their unique needs/demands.
Opportunities and Challenges
We have analyzed and envisioned 15 opportunities and challenges that should be tackled to transform the Hidrovia Parana-Paraguay into a main logistic route for an economical and sustainable development for the Mercosur and we divided them in 3 major categories:
Environment (6):Alternative and non-fossil fuels, Decarbonization, Water Usage and Treatment, Onshore Power Supplies, Eco-incentives Smart Contracts and Waste to Energy.
Infrastructure (3): Port and Shipyards Development, Dredging/Navigability and Signaling/ Lighting
Interoperability (6): Data Sharing, Track & Trace, Traffic Management, Digitization, Automation and Smart Contracts
Bridging Value Waterway Model
The Bridging Value Waterway Model incorporates these variables and a series of parameters to create a high level overview of the potential of various Items or Dimensions and the Economic and Societal impact of these decisions.
The above-mentioned opportunities are ranked accordingly and highlight some of the lowest hanging fruits that can directly impact the Hidrovia as an ecosystem.
The analysis was carried out based on the mentioned references and additional proprietary information.
Furthermore, each of these items was ranked according to an estimated timeline from concept-to-implementation.
Solving each of these challenges individually might be a daunting task. However, creating a constructive and innovating business ecosystem will allow for sustainable growth and economical development.
La Hidrovía del Futuro - Bridging Value’s Pathway to Growth
At Bridging Value we master Business Ecosystems development to address complex challenges addressing the Energy Matrix Transformation.
Consequently, it is our vision to foment a consolidated view of the Hidrovia ecosystem that favors the attraction of talent and innovation to energy management, logistics, transport and operation across the waterways.
We propose building a Regional Innovation Exchange model that can attract, support and facilitate the application of creative talent and entrepreneurship to the logistic-port sectors and associated businesses. We will incorporate feedback from all stakeholders involved in the Hidrovia from Local/Regional/National governments, universities, chambers of commerce, investment funds and startup hubs and associations.
We wish to encourage the creation and consolidation of a network of companies / start-ups in all related fields that develop innovative solutions to solve complex challenges for the market-oriented port logistics sector.
We aim to promote and incorporate disruptive or incremental innovation as an element of competitiveness, efficiency and sustainability in the Hidrovia at a public and private level to facilitate development. We aim for 10X solutions and not 10% incremental solutions!
In order to achieve our goal we are actively seeking to create a consortium of international entities to explore, instigate and capture the opportunities associated with the Innovation Lab greenfield project.
The Bridging Value Approach
The Energy Matrix is undergoing deep changes that will require profound and ambitious analysis to lay the foundations of the future use of energy. In our approach we integrate multiple verticals to offer a novel perspective to a core challenge for every community.
At Bridging Value we observe, analyze, dissect and engage on solving complex problems by establishing robust strategic partnerships.
The scope of the challenge allows us to foster the formation of a dedicated business ecosystem comprising local and global players who will jointly grow while solving the challenge itself.
Our holistic approach is strengthened by the capability of integrating technical knowledge with local cultures leveraging global trends and networks.
References
Acknowledgments and Contributions
We would like to acknowledge Roberto Aiello, Principal Regional Energy Specialist at BID and Romina Bocache, Executive Secretary for the Hidrovia Parana-Paraguay Intergovernmental Committee, for inviting Bridging Value to join the expert panel on Decarbonization along the Hidrovia.
Additional contributors: Giuseppe Liberati - Executive Director at Bridging Value; Natan Herc - Senior Strategic Partnerships Associate
