Syndicate content

Global Economy

A Fragile Country Tale: Restrictions, Trade Deficits, and Aid Dependence

Massimiliano Calì's picture

 Masaru Goto, World BankPart of the World Bank’s new vision is to step up its efforts to help fragile and conflict-afflicted states break the vicious cycle of poverty. But this is no easy task.
 
The destruction of productive assets and the restrictions on the capacity to produce are among the most severe economic impacts of conflicts and fragility. These effects explain why countries in conflict or emerging out of conflict typically have very large trade deficits. The productive sector is often particularly weak by international standards, so exports are low and domestic consumption has to rely on imports. Indeed, five of the ten countries with the largest trade deficit in the world (Timor-Leste, Liberia, the Palestinian territories, Kosovo and Haiti) are considered fragile by the World Bank and other regional development banks (figure 1).
 

In a Complex World, Logistics Improvements Require Measurement and Strategy

Jean-François Arvis's picture



In a report released today, Connecting to Compete 2014: Trade Logistics in the Global Economy, we summarize the results of the Logistics Performance Index (LPI), and examine some of the factors behind different countries’ performance. The index and report, which have been produced about every two years since 2007, rank countries on a number of dimensions of trade, including customs performance, infrastructure quality, and timeliness of shipments.

Nowadays the importance of efficient supply chains for trade integration is recognized globally. Most sources of friction in the global economy—trade costs—are attributable to logistics bottlenecks. These might be physical deficiencies, red tape, especially at borders, or a lack of quality services. The LPI has greatly helped the realization that policy does matter for efficient logistics, and is widely referred to as a guide by policy-makers, including in rich countries such as those in the EU. It has contributed to creating a dynamic of reforms in many developing countries where the Bank has logistics-oriented programs. We are just back from Georgia and Indonesia, and our team is currently in Rabat, Morocco, where we are promoting projects to integrate supply chains of the Maghreb.

For Vietnam, Trade Competitiveness Much More than a Slogan

Luis Blancas's picture

Click to enlarge the infographic.Vietnam is one of the world's development success stories. It is undeniable. 

Between 1990 and 2010, Vietnam grew at an average annual rate of 7.4 percent—one of the world’s top five growth performance records, anywhere, over the same 20-year period. In the process, the incidence of poverty has declined dramatically, from 58 percent in 1993 to about 10 percent today. Nowadays Vietnam is no longer considered a low-income country: it has attained lower-middle income status.

Yet this successful economic transition has also generated a number of challenges. Chief among them is that of sustaining economic growth going forward.
 

TPP & TTIP: More Questions Than Answers

Miles McKenna's picture

Incense stick production in Hue, Vietnam. The country could be one of the biggest winners of a potential Trans-Pacific Partnership trade agreement. Source - Austronesian Expeditions.If you follow trade negotiations, then you know there are few more contentious than those for the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP).
 
On February 4, the World Bank’s International Trade Unit hosted Phil Levy, a senior fellow on the global economy at the Chicago Council on Global Affairs, who has been following both negotiations closely. Levy spoke with World Bank staff about the potential implications for developing countries as negotiations move forward in what he calls “bargaining among behemoths.”
 
At this point in the negotiations, one thing is clear: there are still more questions than answers.

New Online Tool for Calculating Trade Indicators

Jose Daniel Reyes's picture

Library at Mohammed V University at Agdal, Rabat. Source - The World Bank.Access to reliable, accurate, and up-to-date data is crucial to the analysis work we do here at the World Bank. Making sure we have that data and making it as accessible as possible to others is equally as crucial. That's why we have developed a feature on the World Integrated Trade Solution (WITS) platform that aggregates and analyzes trade outcomes.

For those who don’t yet use it, WITS is an online database aggregator where you can access major international merchandise trade, tariffs, and non-tariff data compilations with a click of the mouse. It’s free software that anyone—World Bank Group staff, policymakers, practitioners, researchers, academics—can use when working on trade and competitiveness issues around the world.

Our team here in the International Trade Unit, in collaboration with the Development Economics Data Group, developed a multi-functional “tool” to aggregate several indicators used to assess the trade competitiveness of a country. We call it the Trade Outcomes Indicators Tool.
 

Smuggling Adds to Tunisia's Budget Woes

Gael Raballand's picture

The political situation in Tunisia is still volatile, as protests and riots continue to break out across the country. Source- Arne Hoel, World BankRiots broke out across Tunisia last weekend, as citizens reacted to the government’s latest efforts to trim its budget deficit. Officials are struggling to cut spending and increase revenues, all while responding to the demands of a citizenry increasingly dissatisfied with high unemployment and continued inflation.

The economy grew by close to 3 percent last year, but it has not been enough to create new jobs. Making matters worse, many manufacturers and business owners have been forced to lay off workers in response, they say, to a rise in informal trade and “unfair competition”.

A big issue for the business community, informal trade has been equally as troublesome for the cash-strapped transitional government. According to recent World Bank research, the Tunisian government is losing a significant amount of public revenues-- duties, value-added tax and other taxes-- from informal trade along the Libyan and Algerian borders.
 

The Agreement in Bali Is Just the Beginning: Now the Work Toward Implementation Starts

Selina Jackson's picture

Day 4 of the WTO's Ministerial Conference, Bali, 3 December 2013. Source - WTO.By now the ink has dried on the hard-fought achievement of the 9th Ministerial Conference of the World Trade Organization (WTO) last weekend in Bali, Indonesia. The landmark agreement – the first since the establishment of the WTO in 1995 – consists of three components: trade facilitation, some agricultural topics, and issues of importance to least developed countries.

Beyond the substance, the agreement comes at an important moment. Just at the point when many feared that momentum was shifting toward bilateral agreements and “mega-regional” trade agreements and away from the WTO, members managed to reach agreement at the multilateral level. This is especially important for the small and least developed countries that rely most heavily on the multilateral system to have an equal voice, secure market access, and effectively integrate into the global economy. While trade ministers, the WTO Secretariat, and its Director General deserve credit for the outcome and probably a much-needed rest, attention must now turn toward developing a concerted and well-coordinated effort to ensure successful implementation.

Notes From the Field: Taking On Politics, Shifting Paradigms

Miles McKenna's picture

Editor's Note: "Notes From the Field" is an occasional feature where we let World Bank professionals conducting interesting trade-related projects around the globe explain some of the challenges and triumphs of their day-to-day work. The views expressed here are personal and should not be attributed to the World Bank. All interviews have been edited for clarity.

The interview below was conducted with Manjula Luthria, a Senior Economist in the World Bank’s Middle East and North Africa (MENA) regional division of the Human Development Network. Ms. Luthria's work focuses migration, labor mobility, and social protection. She spoke with us about her early experiences as a country economist for the Pacific Islands region, and how lessons learned there have come to inform the programs and projects her unit works on today.
 

Trade Regionalism in the Asia-Pacific: New Game, Old Rules?

Swarnim Wagle's picture

What's the next move in the major economies' Great Game? Source - wonderkris.Editor's Note: This blog draws on the forthcoming article “New Trade Regionalism in Asia: Looking Past the Sino-American Great Game," written by Swarnim Wagle, to be published in the Global Emerging Voices 2013 Working Papers. 
 
Negotiations over one of history’s most ambitious trade deals have taken another step towards defining the future of Trans-Pacific trade.
 
The latest round of discussions on the Trans-Pacific Partnership (TPP) wrapped up this past weekend in Salt Lake City, Utah. Negotiators are believed to have made headway on a number of thorny issues, clearing the way for ministerial talks to be held in Singapore, Dec. 7-10.   
 
The TPP will draw together 12 countries dotting the perimeter of the Pacific—Australia, Brunei, Chile, Canada, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. But it’s the United States’ efforts to spearhead the talks that have attracted the most attention. Concerns over a lack of transparency and the intrusive scope of the agreements’ provisions into national policymaking have led many to question its objective.
 

Growth in Greece? A Logistical Possibility

Daria Taglioni's picture

The Partnenon in Athesn, Greece. Source -  Nicholas Doumani.More than 95 percent of goods traded between Europe and Asia are transported via deep sea. All of this happens through two primary routes-- some serious traffic. But it's far from stop-and-go. In fact, most doesn’t stop at all.

Large container ships leave ports in Asia and proceed directly to Rotterdam, the Netherlands. Many choose to get there by passing through the Suez Canal, entering the Mediterranean, and bypassing its bygone empires.

One of these ancient powers, Greece, now finds itself in a marginal position on the logistical map of Europe. Despite being geographically and economically well located, it’s far from being the hub it once was. The World Bank’s International Trade Unit and the Transport Unit of the World Bank’s Vice Presidency for the Europe and Central Asia Region recently teamed up with the government of Greece to find out how the country can capture a share of the world’s growing East-West trade and kick-start an economy that has been struggling to maintain GDP growth after the global economic crisis.
 

Pages