230 likes | 333 Views
Connecting Landlocked Developing Countries: What have we learned during the Almaty Programme of Action period ?. Jean-François Arvis International Trade Department The World Bank Washington June 13, 2013. How to assess the impact of the APoA 2004-2013?. Several perspectives
E N D
Connecting Landlocked Developing Countries: What have we learned during the Almaty Programme of Action period? Jean-François Arvis International Trade Department The World Bank Washington June 13, 2013
How to assess the impact of the APoA 2004-2013? Several perspectives • Macro trends: trade, growth • Changes in access costs and connectivity • Effective action on the ground to address sources of access costs and reduced connectivity.
Trends (2000-2011) Revenue per capita in LLDC: • From 11.5 % to 15.6 % of world average • Annual growth 3.8% in LLDC (2.1% SSA) against 3.4% in transit countries, and 1.5% world average Trade: • LLDCs from 0.5% to 1.1% of world trade • Transit countries from 10.3% to 21.7% => NO BETTER TRENDS THAN TRANSIT COUNTRIES
Trade Performance Trade growth 2000-2011 (percent per year)
Trade costs and logistics performance • Trade costs measure the “wedge” between international trade and domestic consumption = ad valorem price equivalent that explain reduction of bilateral trade flows as compared with domestic markets of exporter and importer = caused by distance but also endogenous factors such as connectivity, logistics, and trade facilitation. • National logistics performance measured by Logistics Performance Index (LPI)
Connecting LLDCs • Complex supply chains in transit system • Inefficiencies and fragmentation => logistics costs Logistics Costs= Cost+ Time+ Reliability
Urban myths • Transportation costs in LLDCs can represent 30% of import value in certain countries. • Delays to import are exceeding 100 days in several landlocked countries. • The main sources of costs and delays are the obstacles en route or at borders or bad infrastructure.
Costs = out of pocket expenses for freight • In the absence of market distortion (e.g. freight allocation system), … • road freight is relatively homogenous worldwide (1 to 1.5 USD per km) • But : • Imbalance • Legal and illegal rents plus overheads seeking activities (up to X2) • Other inefficiencies (e.g. idle time) • Market intervention (e.g. Central Africa ) (X2) • Transport markup of being LLDC as compared with transit no more than 5%
Time • Much less corridor time than transoceanic time • Lead time on corridors less than 15 days average (more in Central and Eastern Africa) • 4-6 weeks for transoceanic (breakdown in cost would be more even) • Most delays happen in ports and in transit countries.
Reliability: Looking beyond averages • The spread of delays of transit containers in the port of Dar Es Salam Address sources of fragmentation and unreliability
Transit system Soft and hard infrastructure and implementation mechanisms
What has improved • Infrastructure: • All weather connection for all LLDCs • Rehabilitation and maintenance • Delays in ports • Rarely more than 2 weeks (6 weeks 10 years ago) • But not APoA specific: measure taken for coastal countries, not transit. • IT and trade facilitation: • Border infrastructure • IT systems (e.g. Asycuda) • International legal instruments (no obvious gaps) • Data collection by corridor (SSTAP, CAREC, IRU…)
What has not really improved • Customs reforms in the smaller States (mixed success) • Some success stories with border posts (but over-emphasized). • Market structure of trucking (virtually an ignored area) • Railways (mixed) • Transit system (some attention but often wrong focus or wrong ideas) • Corridor management institutions
Some successes • Malaba (Kenya-Uganda): 2day -> 2 hours at border • Eurasian Customs Union: one border and $500 less per trip • Cotonou (Benin-Niger): cleansing trucks in ports reduces delays from weeks to days • TIM in Central America: the only successful implementation of regional transit out of EU
Where to push • Transit regimes, tremendous potential in regionally integrated system (one procedure one bond). Only two designs to consider: • TIR for loosely integrated areas • EU Common transit for highly integrated regions • Trucking agreements => Very much to do with deeper integration in sub-regions