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Transport and Trade Linkages: Central Asia & Eastern Europe. Henry Kerali Senior Transport Specialist The World Bank. Presentation Outline. Central Asia Transport & Trade Status review Main trade corridors & linkages Trade & transport trends Impediments & suggested reforms
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Transport and Trade Linkages:Central Asia & Eastern Europe Henry Kerali Senior Transport Specialist The World Bank
Presentation Outline • Central Asia Transport & Trade • Status review • Main trade corridors & linkages • Trade & transport trends • Impediments & suggested reforms • Transport & Trade Facilitation in Southeast Europe (TTFSE) • Current issues, project objectives & key actions • Project components & achievements • Recommendations & Scaling-up
Exports from Central Asia Source: TRACECA (Tons/Year) 2001
Imports to Central Asia Source: TRACECA (Tons/Year) 2001
Impediments to Trade & Transport • High transportation and handling costs • Poor transport infrastructure and transport performance • Trade barriers of neighbouring countries • Long and costly customs procedures and other inspections • Lack of coordination between countries in the region • Impediments amount to between 10 – 15% for roads and 2 – 10% for rail • Transportation costs amount up to 50%
Suggested Reforms • Need for regional trade and transport policy • Diversification of the transport industry including forwarding, handling, containerization, etc • Regional harmonization and implementation of customs procedures • Promotion of trade and transport standards • Common and transparent transit fees • Development of rail shuttle services • Implementation of international freight handling standards, e.g. TIR, ASYCUDA, etc.
Trade and Transport Facilitation in Southeast Europe(TTFSE) World Bank supported project
The Issues • The high cost and uncertainties of trade and transport in Southeast Europe are major constraints on economic recovery and development in the region • Complicated, opaque and non-standardized border procedures affect the business environment and deter foreign investment (the Paper Curtain) • Countries concerned with high level of corruption, smuggling, organized crime • Customs administrations do not have aligned legislation and procedures with EU standards
Project Objectives • Reduce non-tariff costs to trade and transport • Reduce smuggling and corruption at border crossings
Actions (1) • Getting donors on board to complement / coordinate / provide assistance • Regional approach/mechanisms: • Regional Forum: Steering Committee • Public – Private Partnerships (PPP) • Training programs for transport operators, freight-forwarders, importers, exporters • TTFSE website • Survey of users
Actions (2) • Focus on Customs procedural reforms • Border Inter-agency awareness and cooperation • Pilot approach: 27 selected border crossing points and in-land stations • National Coordinator • Performance monitoring: overall Customs and pilot indicators • Local Project Teams
Country & Regional Program • Regional Investment Program: US$120 m • WB $78 million • US Government (grant) $13 million; • Others: France, Austria • Each project was designed to be country specific, but supported the development objectives by the selection of elements under similar components
Common Components • Supporting customs reform • Strengthening mechanisms of interaction and cooperation between private and public parties at regional, national, and local levels • Disseminating information and providing training to the private sector
Achievements in 2 ½ years … • Significant reduction of waiting time at the border and inland pilot points (50% and more) leading to US$8million savings annually • Improved dialogue among Customs administrations through regional consultation and information sharing (8 RSC meetings) • “Institutional awareness”: the facilitation role of border agencies vs. revenue collection & control classic roles • Transparent and public Customs performance monitoring system in place
Achievements in 2 ½ years .. • User participation in the evaluation of border agencies’ performance • A collaborative culture of partnership between the public and the private sectors • Certified learning opportunities in road transport operations (85 locations and on-line) • Detailed information available to the public at: www.TTFSE.org
Achievements in 2 ½ years. • Revenue collected by Customs doubled through risk management and selectivity approach • Higher than estimated trade volumes increase (e.g almost doubled in Romania) • EC – WB Policy Notes from lessons learned
Scaling-up TTF • REPLICATE the program to other/all borders, and cross-border projects in SEE • EXPAND the approach and methods to railways, inland water-ways, ports, airports • STREAMLINE international transport documentation & linkages • REPLICATE the program to other regions, e.g. Caucasus, Central Asia, South Asia, East Asia, etc.