Trade and Development Quarterly - 25th edition
International Trade Department
Read more of PRMTR's contributions to the DECPG's Developing Trends report online.
Trade Watch provides more information on trade. Read it here.
| Global trade softened in April... |
|... after a blistering pace in the second half of 2010. The softening in trade growth was largely in response to an easing of demand across high-income and developing countries, with the wide-ranging effects of the Japanese earthquake and tsunami coming into play.|
World trade is estimated to grow at a modest 8% in 2011, but recent global events may translate into a more sluggish growth path (e.g., high unemployment in developed countries, low output in Japan, unrest in MENA and soaring commodity and energy prices.)
|Protectionist policies still loom |
|According to the WTO May 2011 monitoring report, the number of new G20 trade restrictions involving measures such as exports, borders and trade remedies increased from October 2010 to April 2011 compared to the previous 6 month-period. Experts say this is happening because of unemployment in advanced economies and macroeconomic imbalances. Restrictions imposed post-crisis now cover 1.8% of G20 imports, up from 1% 2008-09.|
|Doha: A push for trade facilitation and DFQF |
Doha may be stalled, but at the World Customs Organization in Brussels in June, Director-General Pascal Lamy supported the argument that a trade facilitation deal in the Doha Round would be a tremendous value for trading communities. Trade experts are also pushing for duty-free, quota free (DFQF) market access for LDCs.
| Trade Policy |
|The Philippines has a great comparative advantage in services exports, which now account for over 20% of export revenues, according to senior trade economist Sebastian Saez (PRMTR). Saez presented his upcoming book "Exporting Services: A Developing Country Perspective" at the request of the Philippines country team. At the conference in Manila, Saez highlighted the fact that business processing operations account for a large share of services trade and is now a thriving export for the Philippines. Although demand is still very high, the country might soon face a supply constraint mainly because its pool of workers qualified for this service is reaching its limit. Expanding the pool requires extensive training and changes in the education system.|
|PRMTR's Trade Competitiveness Diagnostic (TCD) Toolkit is available and offers a framework, guidelines and practical tools for assessing a country’s position, performance, and capabilities in export markets. It is intended both for policymakers and practitioners involved in analyzing trade performance and designing trade and industrial policy. The output of a TCD exercise could be a stand-alone product (ESW) or could contribute to existing Bank products – for example, it could form a substantial part of a DTIS, a chapter within a CEM or can help identify components for operational work. This toolkit also reflects the valuable lessons we have learned in the initial and ongoing pilots of the Diagnostic, in Pakistan, Indonesia, Qatar, FYR Macedonia, Senegal and Peru.|
|Overland transport corridors support much of developing countries’ trade. They are indispensable to the 31 landlocked developing countries, home to some 360 million people, notably in Sub-Saharan Africa. To provide some answers to these challenges, senior transport economist Jean-Francois Arvis (PRMTR) released his latest book, "Connecting Landlocked Developing Countries to Markets." The book gives an exhaustive review of the policies addressing the performance of trade corridors. The book argues trade benefits and reduction of trade costs will come rather by addressing the source of inefficiencies in the corridor supply chain. The authors provide insights on what works and does not work, and offer policy recommendations to address these issues. Listen to Arvis give an interview on UN Radio in New York City.||Mauritius: |
|VIEWS FROM THE FIELD:|
Name: Sawkut Rojid
Position: Economist for Mauritius & Seychelles
Country Office: Mauritius
|Question: What is current trade project you are working on?|
Rojid: Mauritius is a small economy with a small domestic market and therefore export oriented. Over the years, this country has undertaken major reforms to enhance trade competitiveness, while maintaining fiscal discipline and improving investment climate.
The goal of this project (a development policy loan with a component on trade), which we are working on with PRMTR, is to reduce regulatory and administrative costs, thereby improving export competitiveness of firms based in Mauritius.
Read Rojid's full interview online.
Pakistan: Pakistan’s position in world trade has barely changed in the past three decades, despite the dynamism of the Asian region. Problems affecting trade in the country include energy security and a complex tarriff system. PRMTR assisted with collecting data and interviewing stakeholders to advance preparation of the trade chapter of the Country Economic Memorandum (CEM) in June. Using firm level data, the team is now trying to explore the relative importance of the main microeconomic and macroeconomic constraints of competitiveness, among them fixed costs (likely to be determined by sector and country specific factors), cost of inputs and technology/efficiency of production related factors.
Morocco: The country team is preparing for a Trade and Competitiveness DPL. PRMTR is helping identify short-term and medium-term policy actions to strengthen Morocco's competitiveness and facilitate its integration in global markets. The building blocks of the program are improvement in the business environment; trade policy and trade facilitation; and governance and regulatory reform. Morocco has embarked on an ambitious trade openness agenda through the conclusion of an Association Agreement with the European Union, and Free Trade Agreements including with the US, Turkey and Arab countries. Morocco has also reduced its MFN rates and is modernizing its trade regulations (non-tariff measures) toward a deeper convergence with the EU. Moving forward, the government is aiming at harmonizing its tariffs and reduce the gap between MFN and preferential rates, engage with the private sector to review the most binding NTMs and streamline trade procedures.
InfoShop Book Launch: Preferential Trade Agreement Policies for Development, edited by Jean-Pierre Chauffour and Jean-Christopher Maur, Washington DC, July 28, 3-5 PM
This handbook on Preferential Trade Agreement (PTA) policies for development offers an introduction into the world of modern preferential trade agreements. It goes beyond the traditional paradigm of trade creation versus trade diversion to address the economic and legal aspects of the regulatory policies that are contained in today‘s PTAs. Read the full book here.
|Third Global Aid for Trade Review, WTO, Geneva, July 18 – 19, 2011|
Aid for Trade aims at helping developing countries develop the trade-related skills and infrastructure that is needed to implement and benefit from WTO agreements and to expand their trade. The OECD and WTO are collecting case stories from WTO member states, aid and international agencies. Read more about the event here.
Board discusses new Trade Strategy
In order to further trade growth, inclusiveness and poverty reduction, the World Bank Group has prepared its first Trade Strategy to guide its work over the next decade. After extensive stakeholder consultantions , the strategy was presented to the Board on June 9. The strategy focuses on four pillars:
- Trade competitiveness and diversification
- Trade facilitation, transport logistics and trade finance
- Support for market access and international trade cooperation
- Managing external shocks and promoting greater inclusion
Sector Director Bernard Hoekman (PRMTR) also blogged about the importance of the strategy here.
Social media and World Bank trade work
Are you already a member on Linkedin? Want to expand your network and find out the latest trade news and events? Please Join PRMTR on Linkedin here. PRMTR is also using the World Bank's Twitter account. If you have a trade story, event or publication you would like to highlight, please email firstname.lastname@example.org.
MDTF-TD has been extended for 12 months
The Multi-Donor Trust Fund for Trade and Development (MDTF) closed in June 2010, but PRMTR has agreed with the donors on a 12 month extension. Remaining funds are being reallocated to the regions and central units working on trade. PRMTR will be discussing with the donors a proposal to secure additional resources for this fiscal year.
Launched in November 2007, the MDTF supports trade-related analytical work at the country, regional and global levels. The program currently has four contributing donors: Sweden, the United Kingdom, Norway, and Finland.
Any questions? Contact Ian Gilson at Igillson@worldbank.org.
|Trade Facilitation in the Doha Round|
PRMTR participated in a G20 development working group meeting, which aimed to improve donor access and coordination in trade facilitation. Three areas of action were prioritized in partnership with the Africa region: (i) enhancing an existing multi-agency global trade facilitation partnership (ii) establishing an Africa-wide platform to support coordinated transport and logistics policy and regulatory reform to complement investments in regional infrastructure; and (iii) a joint effort by G20 countries to provide a pool of qualified customs officials and trade facilitation experts.
InfoShop: Managing Openness
Sector Manager Mona Haddad (PRMTR) presented her recent publication "Managing Openness", which addresses the critical policy issues revolving around the topic of outward-oriented growth. More specifically, the book looks at issues such as the increasing importance of South-South trade, policy instruments to help manage the risks that come with increased openness, and lessons learned from the crisis for particular countries and regions.
PREM VP Otaviano Canuto also blogged about the need for trade and diversification.
Trade Facilitation Conference
More than 60 experts attended this half-day event hosted by PRMTR, which explored some of the latest trends and innovative approaches in trade facilitation and logistics with renowned experts in this field.
The key messages from the event included addressing the challenges of finding reliable supply chain data and how single windows -- "one stop posts" can be a catalyst for better governance.
If you missed the event, the presentations and agenda are available online.