LOGISTICS PERFORMANCE INDEX AND DOING BUSINESS INDICATORS

1. LOGISTICS PERFORMANCE INDEX AND DOING BUSINESS INDICATORS SouleymaneCOULIBALY ECA Regional Trade Coordinator Geneva, June 14th, 2011

2. The Logistics Performance Index and Doing Business Report Two separate but complementary reports

3. The Logistics Performance Index • Measures the tradelogistics efficiency of a country • Fundamental premise: Efficient logistics drives economic performance

4. The Doing Business Report • Provides measures of the ease of doing business (regulations) for local firms in a given country • Fundamental premise: economic activity requires effective regulations in all areas of setting up and operating a business

5. Agenda 1. Overview of LPI 2010 2. Overview of Doing Business 2011 3. LPI Results: CIS countries 4. DB Results: CIS Countries 5. Want to Learn More?

6. 1. Overview LPI 2010

7. The Logistics Performance Index • First report in 2007, every three years • Source of data is suppliers of logistics services (freight forwarders, express carriers) • Rates logistical performance on a scale of 1 to 5

8. LPI: Key messages • Trade logistics is an important element of national competitiveness • A country’s performance is only as good as its weakest link • The LPI dataset can be used to identify key bottlenecks in your own country

9. What are efficient logistics? The LPI measures six dimensions of country performance: • Efficiency of the clearance process • Quality of trade and transport infrastructure • Ease of arranging competitively priced shipments • Logistics competence and quality of logistics services • Ability to track and trace shipments • Timeliness of shipment delivery

11. Key Policy Implications: • Expand the traditional development agenda beyond customs reform and infrastructure to be comprehensive—processes, services, and infrastructure. • Increase border agency coordination • Partner with the private sector • Reform must be tailored to each country’s circumstances

12. The Logistics Performance Index

13. 2. Overview Doing Business 2011

14. The Doing Business Report • First report in Sept 2003, yearly • Covers 183 countries • Surveys in-country specialists with knowledge of regulatory system • Provides a basis for measuring, understanding and improving the regulatory environment for business • creates methodology and a database for policy makers 14

15. The Doing Business Report • Doing Business does not measure all aspects such as: • macroeconomic stability • corruption • level of labor skills • proximity to markets, • regulations specific to foreign investment or financial markets 15

16. Doing Business indicators – 11 areas of business regulation (9 included in the ranking) 16

17. Doing Business – Trading Across Borders index What are best practices? • Paper-free electronic data interchange (EDI) system • Risk - based inspection systems (less than 10% of cargo physically inspected) • Electronic Single Window for obtaining trade documents and approvals

18. The Doing Business Report

19. LPI and DB – separate but complementary Both indices provide basic input for policy-makers. Neither are in-depth analysis.

20. 3. LPI Results: CIS countries

21. LPI 2010 – performance varies around the world Logistics unfriendly Partial performers Consistent performers Logistics friendly No data Countries are improving around the world

22. More than income: the “logistics gap” With the right investment and policies, lower income countries can also be high performers

23. Overperformers and underperformers

24. LPI 2010 Ranks

25. 25 countries achieved significant improvement in LPI

26. 25 countries achieved significant improvement in LPI 25 countries improved between 2007 and 2010 • LICs: Afghanistan, Chad, Haiti, Myanmar, Niger, Tajikistan, Tanzania, and Uzbekistan • LMICs: China, Djibouti, Honduras, Philippines, and Syria • UMICs: Brazil, Colombia, Costa Rica, Dominican Republic, Kazakhstan, Lebanon, Mexico, Poland, Russian Federation, and Uruguay • HICs: Saudi Arabia and the Czech Republic Source: Logistics performance survey data, 2010 and 2007

27. LPI Scores by Region

28. LPI Scores

29. % of the highest performer

30. Performance in the 6 areas of the LPI 2010 Average LPI Score

31. Infrastructure quality

32. Quality of services I TRANSPORT SERVICES

33. Quality of services II

34. Border clearance procedures / corruption

35. Positive trends in logistics performance since 2005

36. 4. Doing Business Results: CIS Countries

37. Top 30 economies on the ease of Doing Business 2009/10 37

38. Eastern Europe and Central Asia is the second best performing region in 2008/09 • CIS economies: • Georgia • Kyrgyz Republic • Armenia • Azerbaijan • Kazakhstan • Belarus • Moldova • Russian Federation • Tajikistan • Ukraine • 150 Uzbekistan 38

39. Kazakhstan improved the most in the ease of doing business in 2009/10 39

40. Worldwide the pace of reforms making business easier remains strong: 216 in 117 economies. Percentage of countries with at least one positive reform in 2009/10 Eastern Europe and Central Asia again with the most improvements in the ease of doing business in 2009/10, followed by East Asia and Pacific 84% Eastern Europe and Central Asia OECD high Income 61% 47% 63% 59% 67% Middle East and North Africa 75% East Asia and Pacific South Asia Latin America and Caribbean Sub-Saharan Africa 40

41. 90% of the economies in the ECA region improved their business environment While 85% of economies worldwide improved business regulation over the last 5 years. 41

42. 21 of 25 economies in Eastern Europe & Central Asia improved business regulations this year 6 economies eased trading across borders in the region 42

43. 33 economies reformed making it easier to trade across borders in 2009/10 43

44. Implementation of electronic systems most popular trade facilitation reforms in 2009/10 List of economies that made trading easier by types of reforms Bahrain Belarus Brunei Egypt Israel Kazakhstan Latvia Lithuania Nicaragua Pakistan Peru Philippines Swaziland Tunisia U.A.E Zambia Armenia Egypt Ethiopia Fiji Grenada Mali Peru West Bank & Gaza Burkina Faso Cambodia Kazakhstan Montenegro Rwanda Spain Angola Bahrain Kenya Nicaragua Pakistan Saudi Arabia Armenia Guyana Kazakhstan Peru EDI system implementation Customs administration Risk based inspections Document reduction Port procedures

45. Time to export and import in Eastern Europe & Central Asia: still long, but improving • Traders in the region typically still face delays over twice as long as in OECD high income economies • But, average time to export and import in the region dropped over the years by 5 days for exporting and 6 days for importing Note: Time to trade includes the 4 processes discussed in previous slide

46. Eastern Europe and Central Asia economies also made improvements in number of required documents • Traders in OECD high income economies require less than 5 documents on average to export and import • Whereas traders in Eastern Europe and Central Africa still require on average 2-3 additional documents

47. Emphasis on trade facilitation in many developing economies Note: shows number of cumulative reforms easing trade across borders since DB2007 (counted as 1 reform per reforming economy per year)

48. The trade facilitation reforms impacted lower income countries the most 2006 - 0.9 days • 2.9 days - 4.0 days - 4.7 days 2010

49. Peru: the economy that most eased trade in 2009/10 • New EDI system • Improved risk-based inspections • Payment deferrals of import duties and taxes

50. 5. Want to Learn More?