Narrow Results

During the coronavirus disease 2019 (COVID-19) pandemic, mobility restrictions had a significant impact on trade times and costs at the borders, particularly in landlocked developing countries. This paper examines the effect of COVID-19 mobility measures on the time required for cargo to clear the borders, using monthly bilateral time measures at the border crossing points (BCPs) of Central Asia Regional Economic Cooperation countries. An estimation of impulse response functions reveals that the time for inbound cargo to clear the border increased by up to 40% when the most stringent mobility restrictions were implemented. However, the results indicate that the time for outbound cargo was not significantly affected. Furthermore, our findings demonstrate the cross-border spillover effect of a trading partner’s mobility measures. Both inbound and outbound times at own-BCPs increased when a trading partner implemented tightened mobility restrictions. These findings emphasize the need for enhanced policy coordination and monitoring among trade partners during emergencies, providing valuable insights for border management strategies.

This study examines the effects of at-the-border and behind-the-border measures on the intraregional perishable goods trade in the Central Asia Regional Economic Cooperation region by combining trade facilitation indicators at the bilateral product level with an extensive dataset of nontariff measures. By utilizing a Poisson pseudo-maximum likelihood estimation technique in a gravity model, this study shows no empirical evidence that the time and cost associated with clearing perishable products at border crossing points harm intraregional trade. However, behind-the-border measures assume a more significant role in facilitating or impeding the perishable goods trade. Therefore, our findings highlight the importance of enacting structural reforms in trade facilitation—such as enhancing the capabilities and capacities of sanitary and phytosanitary laboratories, aligning regulations with international standards, simplifying and harmonizing documentary requirements, streamlining border processes, and promoting collaboration among customs and other relevant agencies involved in the trade of perishable goods.

As tariffs and non-tariff barriers (NTBs) fall attention has shifted to trade facilitation, both in the WTO and in regional arrangements such as ASEAN or APEC. Economists have, however, been slow to develop convincing measures of trade costs. Commonly cited estimates of the border effect or of trade costs are huge, but flawed. The gap between CIF and FOB values of trade is the best aggregate measure, but suffers from lack of consistent data. This paper reviews evidence in the literature based on US and Australian import data, extends the sample to include data from Chile and Brazil and concludes that inferences about trade costs are fairly robust across various countries' import datasets.

This paper examines the impact of improved trade facilitation measures and institutional capacity in a set of economies in transition Europe. Our results suggest that behind-the-border barriers play an important role in determining bilateral trade flows (controlling for the effects of tariffs, development levels, distance, and regional characteristics of exporters and importers, among other factors). For European Union (EU) members that joined the Union in 2004 and less developed and candidate members raising capacity in port efficiency and information technology infrastructures halfway to the EU-15 average, trade could expand by US$49 billion and US$62 billion respectively. In the context of the economic crisis and fragile recovery, as well as efforts to strengthen Europe integration, efforts to facilitate trade with investments to raise capacity in trade facilitation should be considered as part of policy steps going forward.

Despite its several inherent weaknesses, Doing Business compiled by the World Bank is still the most widely used assessment of the trade facilitation status among developing country policymakers as well as economists. In this paper, we suggest that the use of trade costs calculated based on trade statistics in conjunction with Doing Business data is helpful in drawing up sector-specific trade facilitation policies. Unlike Doing Business, we can obtain long-term commodity-level trade costs if trade statistics are used.

The paper first surveys the trade facilitation (TF) landscape at the regional level and analyzes the main forces shaping it. It identifies key factors driving regional facilitation approaches, examining their priorities, features and underlying philosophies. The paper also highlights significant trends in regional TF provisions and analyzes their implications. The paper then compares regional and multilateral initiatives, looking at areas of convergence and divergence, and highlighting where potential gaps exist. It analyzes negotiating positions in the respective frameworks and discusses both the benefits and limitations of the resulting TF provisions. Examining the impact of the recently concluded WTO Agreement, the study highlights its potential value added.

Outward direct investment (ODI) from the People's Republic of China (PRC) is surging. A common perception is that it was driven by the country's resource-seeking and technology-seeking motives. Using a new, unique, and comprehensive dataset that covers close to 10,000 Chinese ODI deals from 1998 to 2009, we find that in contrast to the common perception, over half of the ODI deals are in service sectors, with many of them appearing to be export-related. In addition to documenting the pattern and trend of the PRC's ODI, we empirically examine both the determinants and effects of ODI at the firm level. We find that ex ante larger, more productive, and more export-intensive firms are more likely to start investing abroad. Using matching estimation techniques, we find that ODI is associated with better firm performance, including higher total factor productivity, employment, and export intensity, and greater product innovation. To assess the relative contributions of technology transfer, export promotion, and resource seeking to the positive effects of ODI, we use ODI data merged with customs transaction-level trade data. We find that firms’ ODI participation is associated with significantly better trade performance, measured by export and import volumes, export and import unit values, and number of export destinations. Contrary to perceived technology-seeking and resource-seeking motives, we find no evidence that ODI firms import more capital or intermediate inputs compared to non-ODI firms.

In this paper the authors develop an innovative 21 sector computable general equilibrium model of Armenia to assess the impact on Armenia of a Deep and Comprehensive Free Trade Agreement (DCFTA) with the EU, as well as further regional or multilateral trade policy commitments. They find that a DCFT A with the EU will likely result in substantial gains to Armenia, but they show that the gains derive from the deep aspects of the agreement. In order of importance, the sources of the gains are: (i) trade facilitation and reduction in border costs; (ii) services liberalization; and (iii) standards harmonization. A shallow agreement with the EU that focuses only on preferential tariff liberalization in goods will likely lead to small losses to Armenia primarily due to a loss of productivity from lost varieties of technologies from the Rest of the World region in manufactured products. Additional gains can be expected in the long run from an improvement in the investment climate. The authors estimate only small gains from a services agreement with the CIS countries, but significant gains from expanding services liberalization multilaterally.

In 2010, Russia, Belarus and Kazakhstan formed the Eurasian Customs Union and imposed the Russian tariff as the common external tariff of the Customs Union. This resulted in almost doubling the external average tariff of the more liberal Kazakhstan. Russia has benefited from additional exports to Kazakhstan under the protection of the higher tariffs in Kazakhstan. But estimates reveal that the tariff changes resulted in substantial transfers from Kazakhstan to Russia as importers in Kazakhstan now purchase lower quality or higher priced Russian imports that are protected under the tariff umbrella of the common external tariff. Transfers from the Central Asian countries to Russia were the reason the Eurasian Economic Community (known as EurAsEC) failed, so this bodes badly for the ultimate success of the Eurasian Customs Union. What is different, however, is that the Eurasian Customs Union and its associated Common Economic Space aim to reduce non-tariff barriers and improve trade facilitation, and also to allow the free movement of capital and labor, liberalize services, and harmonize some regulations. Estimates by my colleagues and I show that if substantial progress could be made in trade facilitation and reducing non-tariff barriers, this could make the Customs Union positive for Kazakhstan and other potential Central Asian members. Unfortunately, so far the Customs Union has made these matters worse. But Russia's accession to the World Trade Organization will eventually substantially reduce the transfers from Kazakhstan to Russia. Progress with non-tariff barriers and trade facilitation, however, will take a strong political commitment from Russia which we have not yet seen. But if that Russian political leadership is forthcoming, the Eurasian Customs Union could succeed where its predecessor failed.

In this paper, a more efficient index system of trade facilitation has been set up and has been utilized in measuring China's major trading partners. The index system selected certain indicators from five themes, namely, port efficiency, tariff environment, infrastructure and service, information and communication technology and business environment. Analytic Hierarchy Process (AHP) has been used to construct a much more comprehensive index system measuring trade facilitation under open environment and Delphi Method has been used to identify the weight of each index. The empirical results of trade facilitation on China's 25 major trading partners has showed China's level of trade facilitation remains at a low and middle level worldwide currently.