Trade Facilitation and competitiveness

Definition

The impact of trade facilitation initiatives on competitiveness

Overview

Recent research has repeatedly underscored the link between transport costs, and more comprehensively, total logistical costs, including the time expenditures associated with the movement of the consignment, the impact of regulatory and administrative regimes and procedures, and export flows. More precisely, for labor-intensive manufactured exports—which are a major source of employment generation and revenues for many developing countries—competitive global markets often mean that higher transport costs have to be offset by lower wages for a given product to remain competitive. The obverse, and the implied high elasticity of wages with respect to transport costs, in particular for countries at a geographic disadvantage compared with the location of their prospective markets, has a significant impact on the contribution of economic growth to poverty reduction, and calls for targeted actions to address this issue.

However, the relationship between costs and competitiveness is only one aspect, as increasing and broadening exports reduces the vulnerability of the respective economy to exogenous shocks and increases the potential for knowledge spillovers in specific sectors. In addition, the improved business climate, or the perception of an improvement, can have a positive impact on Foreign Direct Investment (FDI), which itself creates further knowledge spillovers and linkage externalities.

Where to Start

Join the effort!

The GFP welcomes feedback/additions/tools from practitioners, who either applied the GFP methodology or are using their own instruments. The GFP is particularly interested in collecting and assembling all the methodologies, survey instruments and results developed and used by its Partners.

Please e-mail those to support@gfptt.org and suggest the topic(s) under which they could be included. Or post relevant documents under your partner profile and assign them to this topic.

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Irish Minister of State assesses Port Training Programme in United Republic of Tanzania

29 Apr - Joe Costello, Minister of State at Ireland’s Department of Foreign Affairs and Trade,  has completed a visit to the United Republic of Tanzania at which he reviewed the impact of the UNCTAD Port Training Programme.​ Read more ...

 

Geographic coverage: 
Global

UNCTAD Liner Shipping Connectivity Index (LSCI)

Countries’ access to world markets depends largely on their transport connectivity, especially as regards regular shipping services for the import and export of manufactured goods. UNCTAD’s Liner Shipping Connectivity Index (LSCI) aims at capturing a country’s level of integration into global liner shipping networks.

How to join: 

Free viewing and download from http://stats.unctad.org/lsci

Periodicity: 
annual
Geographic coverage: 
Global

UNCTAD Review of Maritime Transport

The Review of Maritime Transport is an UNCTAD flagship publication, published annually since 1968.

Around 80 per cent of the volume of international trade in goods is carried by sea, and the percentage is even higher for most developing countries. The Review of Maritime Transport provides an analysis of structural and cyclical changes affecting seaborne trade, ports and shipping, as well as an extensive collection of statistical information. Every issue provides data and insights on:

How to join: 

Free download from http://unctad.org/rmt

Periodicity: 
annual
Geographic coverage: 
Global

Review of Maritime Transport 2012

More than 80 per cent of international trade in goods is carried by sea, and an even higher percentage of developing-country trade is carried in ships.

The Review of Maritime Transport, an annual publication prepared by the Division on Technology and Logistics of the UNCTAD secretariat, is an important source of information on this vital sector. It closely monitors developments affecting world seaborne trade, freight rates, ports, surface transport and logistics services, as well as trends in ship ownership and control and fleet age, tonnage supply and productivity.

Geographic coverage: 
Global

Trade and Transport Facilitation Assessment - A Practical Toolkit For Country Implementation

Release date: 
07/08/2010
Published date: 
07/08/2010

This new edition of the toolkit provides an opportunity not only to reflect the changes in the trade environment and the need for additional features in the toolkit, but also to benefit from the experiences of the assessments already undertaken based on the original edition. In 2001, the Bank issued a first Trade and Transport Facilitation Audit (TTFA) toolkit based on an original concept developed by John Raven. This initial concept was extensively revised to give the new toolkit an increased operational focus.

Type: 
Reports/Studies
Relevance Degree: 
Must Read
Geographic coverage: 
Global

Export performance and trade facilitation reform : hard and soft infrastructure

Release date: 
06/22/2010
Published date: 
05/04/2010

The authors estimate the impact of aggregate indicators of "soft" and "hard" infrastructure on the export performance of developing countries. They build four new indicators for 101 countries over the period 2004-07. Estimates show that trade facilitation reforms do improve the export performance of developing countries. This is particularly true with investment in physical infrastructure and regulatory reform to improve the business environment.

Type: 
Working Papers
Relevance Degree: 
Good Read
Geographic coverage: 
Global

Behind the Border Trade Facilitation in Asia-Pacific: Cost of Trade, Credit Information, Contract Enforcement and Regulatory Coherence

Release date: 
06/20/2010
Published date: 
05/20/2009

The performance of Asia-Pacific countries in terms of both trade and business facilitation varies greatly. However, with a few exceptions, developing countries in the region have much room for improvement. This paper evaluates the potential contribution of both trade and business facilitation measures to trade and export competitiveness, as well as the potential gains from adopting a more integrated and coherent approach to trade and business (investment) facilitation.

Type: 
Reports/Studies
Relevance Degree: 
Good Read
Geographic coverage: 
Not Global

Distance and regionalization of trade for low-income countries

Release date: 
06/20/2010
Published date: 
02/18/2010

The "distance effect" measuring the elasticity of trade flows to distance has been rising since the early 1970s in a host of studies based on the gravity model, leading observers to call it the "distance puzzle". This paper reviews the evidence and explanations. Using an extensive data set of 124 countries over the period 1970-2005, the authors confirm the existence of this puzzle and identify that it only applies to poor countries (the bottom third in per capita income terms in the sample -- i.e., the low-income countries according to the World Bank classification, 2006).

Type: 
Working Papers
Relevance Degree: 
Good Read
Geographic coverage: 
Global

Formulas and flexibility in trade negotiations : sensitive agricultural products in the WTO's Doha agenda

Release date: 
06/20/2010
Published date: 
04/02/2010

Many trade negotiations involve large cuts in high tariffs, with flexibilities allowing much smaller cuts for an agreed number of politically-sensitive products. The effects of these flexibilities on market access opportunities are difficult to predict, creating particular problems for developing countries in assessing whether to support a proposed agreement.

Type: 
Working Papers
Relevance Degree: 
Good Read
Geographic coverage: 
Global

Global economic crisis and trade: the role of trade facilitation

Release date: 
05/19/2010
Published date: 
06/19/2010

The onset of the global economic crisis has led to a slump in global demand. However, the extent to which major trading powers have reduced their imports has differed by trading partner. Like financial contagion, could it be the case that countries that are better integrated in the global trading system via efficient trade facilitation environment suffered the most because of their interconnectedness? Using recent data from the US census bureau, this study finds that the efficiency of the trade facilitation environment actually helped to mitigate the effects of the global slump in demand.

Relevance Degree: 
Good Read
Geographic coverage: 
Global

Export Performance and Trade Facilitation Reform: Hard and Soft Infrastructure

Release date: 
04/19/2010
Published date: 
06/19/2010

The authors estimate the impact of aggregate indicators of “soft” and “hard” infrastructure on the export performance of developing countries. They build four new indicators for 101 countries over the period 2004-07. Estimates show that trade facilitation reforms do improve the export performance of developing countries. This is particularly true with investment in physical infrastructure and regulatory reform to improve the business environment.

Type: 
Working Papers
Relevance Degree: 
Good Read
Geographic coverage: 
Global

Domestic constraints, firm characteristics, and geographical diversification of firm-level manufacturing exports in Africa

Release date: 
01/19/2009
Published date: 
03/01/2008

Using firm-level data on manufacturing sectors in Africa, this paper addresses how domestic supply constraints and other firm characteristics explain the geographical orientation of firms' exports and the overall market diversification of African manufacturing exports. The degree of market diversification, measured by the number of export destinations, is highly correlated with export intensity at the firm level, and both embody strong scale effects.

Type: 
Working Papers
Relevance Degree: 
Good Read
Geographic coverage: 
Not Global

Trade policy, trade costs, and developing country trade

Release date: 
12/18/2008
Published date: 
01/18/2009

This paper briefly reviews new indices of trade restrictiveness and trade facilitation that have been developed at the World Bank. The paper also compares the trade impact of different types of trade restrictions applied at the border with the effects of domestic policies that affect trade costs. Based on a gravity regression framework, the analysis suggests that tariffs and non-tariff measures continue to be a significant source of trade restrictiveness for low-income countries despite preferential access programs.

Type: 
Working Papers
Relevance Degree: 
Must Read
Geographic coverage: 
Global

New Eurasian Land Transport Initiative is launched!

The New Eurasian Land Transport Initiative (NELTI) was launched in Tashkent, Uzbekistan, on the occasion of an international conference on the development of road freight operations in the Central Asian region, held on 16 September, which gathered representatives from UNESCAP, UNECE, Transport Ministries of European and Asian countries, NGOs and international road transport carriers' associations in the region.

Type: 
Cooperation
Goals: 
  • Support socio-economic progress and trade relations by linking businesses and approaching communities as well as nations in the Euro-Asian space
  • Turn disadvantages of landlockedness of Central Asian states into advantages by providing improved access to export and import markets and benefitting from their transit position
  • Monitor impediments to the smooth flow of trade and transport
Scope and activities: 

Regularised commercial road freight transport operations on various Euro-Asian road links

Start and End date: 
09/16/2008
Main contact: 
Status: 
On-going
Selected Activity: 
No
Type of funding: 
Self-funded
Fully online: 
No
Geographic coverage: 
Not Global

The impact of regional liberalization and harmonization in road transport services : a focus on Zambia and lessons for landlocked countries

Release date: 
05/01/2008
Published date: 
01/22/2008

Based on a detailed empirical study, this paper argues that regional liberalization of trucking services has had an important effect on transport costs and tariffs for Zambia’s economy. Zambia is a peculiar example in Southern Africa as it benefits from relatively low transport costs compared with other landlocked countries in Africa. This is mainly because of competition between Zambian and other regional, mainly South African, operators and because of South African investments in Zambia’s trucking industry.

Type: 
Reference Documents
Relevance Degree: 
Good Read
Geographic coverage: 
Not Global

Institutions, infrastructure, and trade

Release date: 
05/01/2008
Published date: 
02/23/2007

Type: 
Reports/Studies
Relevance Degree: 
Good Read
Geographic coverage: 
Not Global

The Effect of Facilitation on Sectoral Trade

Release date: 
02/15/2008
Published date: 
12/06/2007

This paper aims to analyse the effect of trade facilitation on sectoral trade flows. We use data from the World Bank’s Doing Business Database on the fees associated with completing the procedures to export or import goods in a country, on the number of documents needed and on the required time to complete all the administrative procedures to import and export. An augmented gravity equation is estimated for 13 exporters and 167 importers using a number of estimation techniques, namely OLS, PPML and the Harvey model.

Type: 
Reference Documents
Working Papers
Relevance Degree: 
Useful Background
Geographic coverage: 
Global

The Economic Impact of Trade Facilitation

Release date: 
02/15/2008
Published date: 
10/12/2005

This paper examines the economic impact of trade facilitation and in particular the link between trade facilitation and trade flows, government revenue and foreign direct investment. It is part of a series of studies that analyse various aspects of trade facilitation and the objective is to contribute to discussions in the WTO Negotiating Group on Trade Facilitation (NGTF) and elsewhere in the trade policy community. The paper finds that improved and simplified customs procedures would have a significant positive impact on trade flows.

Type: 
Reports/Studies
Relevance Degree: 
Useful Background
Geographic coverage: 
Global

The Need for and Cost of Selected Trade Facilitation Measure Relevant to the WTO Trade Facilitation Negotiations: A Case Study of Nepal

Release date: 
02/15/2008
Published date: 
04/15/2006

Trade facilitation has been a longstanding and traditional feature of GATT, which is expected to have serious implication for developing member countries. This study aims to evaluate the need for and the cost of implementing trade facilitation measures in Nepal in the context of the ongoing WTO negotiation. Nepal initiated market oriented economic reforms in 1985. Trade liberalization under the economic reform was significant. However, trade facilitation has got due attention only in recent years.

Type: 
Reference Documents
Relevance Degree: 
Useful Background
Geographic coverage: 
Not Global

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