Air transport is an increasingly critical area for trade and trade facilitation. As such, our World Bank trade teams are always searching for global good practice and promising policy results.
This search recently brought us to Armenia, where an “Open Skies” policy has been in place since late 2013. For a country with a long legacy of tight regulations in its commercial aviation market, this new policy signaled a sharp break from tradition.
Although there are no single accepted definitions of Open Skies, it refers to a set of provisions typically agreed on a bilateral basis, that enable each party to set freely the number of flights, carriers, types of aircraft and destinations; but also pricing freedom, as well as establishing the conditions for fair competition and provisions for carriers to engage in commercial cooperation.
Armenia’ Open Skies policy is particularity important when considering the country’s historically limited connectivity with international markets – partly determined by geography, and partly determined by geopolitical considerations. Besides being landlocked, the country has open land borders with only two of its four neighboring countries.
L’horizon semble se dégager pour Haïti, qui poursuit son redressement depuis le séisme dévastateur de 2010. Et cela, grâce (en partie) au commerce extérieur.
Les autorités haïtiennes le savent qui s’emploient, avec le Groupe de la Banque mondiale et d'autres donateurs, à identifier les obstacles aux échanges pour les démanteler et doper ainsi les secteurs exportateurs.
Au début du mois, une équipe de la Banque mondiale s’est rendue à Port-au-Prince pour une semaine de travail avec les principaux acteurs, publics et privés, de la logistique commerciale du pays, notamment des représentants du ministère du Commerce et de l'Industrie. L’objectif ? Discuter de solutions pour renforcer le programme de facilitation des échanges du pays, financé par un fonds fiduciaire multidonateurs conçu pour aider les pays en développement à renforcer leur potentiel économique et à lutter contre la pauvreté grâce au commerce.
- fonds de facilitation des échanges
- Trade Facilitation Facility
- trade facilitation
- Économie et commerce international
- Développement du secteur public
- Développement du secteur privé
- Migration and Remittances
- Lois et réglementations
- Global Economy
- Agriculture et développement rural
- Amérique latine et Caraïbes
Things are looking up in Haiti as the country continues to rebuild from the devastating 2010 earthquake. And part of this progress is a story of trade.
The Haitian government recognizes this, and is working with the World Bank Group and other donors to identify and remove barriers to trade to better promote export growth.
A World Bank team traveled to Port au Prince earlier this month for a week long workshop with the main stakeholders (public and private) intervening on trade logistic in the country, including the Ministry of Commerce and Industry, in order to discuss ways to strengthen the Haitian Trade Facilitation (TF) program. The program is funded through the Trade Facilitation Facility, a multi-donor trust fund dedicated specifically to helping developing countries realize economic development and poverty reduction through trade.
One of the core principles of trade economics is that of “comparative advantage.” First described by David Ricardo, the theory says that countries are best off if they specialize in products that they can make relatively more efficiently – with lower opportunity cost – than other countries. If this happens, the theory goes, global welfare will increase. This concept is more difficult than it sounds, however – as Paul Krugman has pointed out quite eloquently – and benefits from illustration.
Basketball genius Michael Jordan stars in one example sometimes used in textbooks and classrooms: If Jordan mows his lawn faster than anyone else in the neighborhood, he has an absolute advantage in lawn mowing. But that doesn’t mean that he should mow his neighbor John Smith’s lawn, because that would come at an opportunity cost: in the same two hours it would take Jordan to cut the grass, he could earn much more by playing basketball or making a commercial.
While it is difficult to measure comparative advantage in world trade, one indicator is something called “Revealed Comparative Advantage” (RCA). This is a measure of how a country’s exports compare to those of a bigger group, such as a region or the rest of the world. For example, if a country’s RCA in wheat is high (typically greater than one), that means wheat makes up a higher share of that country’s total exports than it does of the world’s exports. This suggests that that country is a more efficient wheat-producer than the average country.
But countries don’t always produce the products in which they have a revealed comparative advantage. Sometimes Michael Jordan mows the lawn. Let’s take a look at a couple of examples from this new data visualization tool.
The world’s 45 Least Developed Countries that are not oil producers (non-oil LDCs) are exporting less and less in the global market place. Between 1985 and 2012, the world market share of non-oil LDCs’ exports of goods and services fell from 1.2 percent to 0.8 percent—all while their share in world population rose from 7.5 percent to 9.9 percent.
The 2005 Aid for Trade (AFT) initiative was designed to arrest this decline. Yet, LDCs’ trade costs continue to fall less rapidly than those of their competitors.
Clearly, it’s time to re-evaluate the AFT initiative.
A new e-book does just that, and, contrary to what some may think, concludes that the initiative has been beneficial. But due to a collective failure to clearly articulate its results, the achievements of the AFT initiative are now at risk as development budgets come under increasing pressure.
Editor's Note: "Notes From the Field" is an occasional feature where we let World Bank Group 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 Group. All interviews have been edited for clarity.
The interview below was conducted with Amit Mukherjee, a Lead Public Sector Specialist with the World Bank Group. Amit works in the WBG’s new Governance Global Practice, where much of his work centers on the Russian Federation. Amit was the project team leader for the recent Russian Federation Customs Development Project (CDP), which helped to reform and modernize the country's Federal Customs Service. Approved in 2003, the CDP wrapped up last year—with some impressive results. The Trade Post spoke with Amit about his experience in Russia, what makes reform in the country challenging, and where the two parties’ relationship can bring about positive outcomes in the future.
I have to confess I am indifferent to soccer. Until last week, I was mostly annoyed by the distraction brought by the current World Cup.
And then things changed a bit. Reading Le Monde, I was intrigued by a graphical representation of a complex network. It just so happened to be a representation of the strategy of the Dutch soccer team. This is a simple and clever representation, which—at least, for me—makes soccer interesting.
Bhutan has some of the most thrilling rides in the world—in the air and on the ground.
Flying into Paro Airport, the only international airport in Bhutan, is an experience like none other—its narrow runway tucked between rugged 18,000-foot peaks, high in the Himalayas. Below, the road between Thimphu, the capital, and the border city of Phuentsholing twists and turns as it navigates some of the world’s highest mountain passes, often blanketed in fog with visibility reduced to mere meters. On clear days, both offer some of the most stunning, breathtaking views you will ever see.
But stunning peaks do not make for easy trade routes, and this is a problem in Bhutan. That’s why the World Bank’s International Trade Unit teamed up with the South Asia Transport Unit to conduct a diagnostic of impediments to transport and trade facilitation in Bhutan. The diagnostic, a prelude to a potential investment operation, was based on the recently released Trade and Transport Corridor Management Toolkit.
It’s 38°C (99°F) in Ouagadougou, the capitol city of Burkina Faso, today—and it’s been this hot all week. The end of the warm season is near, but in places like Ouaga (pronounced WAH-ga, as its better known), temperatures stay high year-round. These are the African drylands: hot, arid, and vulnerable.
Over 40 percent of the African continent is classified as drylands, and it is home to over 325 million people. For millennia, the people of these regions have adapted to conditions of permanent water scarcity, erratic precipitation patterns, and the constant threat of drought. But while urban centers like Cairo and Johannesburg have managed to thrive under these harsh conditions, others have remained mired in low productivity and widespread poverty.
The World Bank has been partnering with a team of regional and international agencies to prepare a major study on policies, programs, and projects to reduce the vulnerability and enhance the resilience of populations living in drylands regions of Sub-Saharan Africa.
Corruption continues to plague customs administrations around the world regardless of their level of development and despite intense public attention.
Recent high profile cases in many first world countries reinforce what we always knew—that no country is immune, and that there are no quick fix solutions available. The very nature of customs work makes it vulnerable to many forms of corruption, from the payment of informal facilitation fees to large scale fraud and other serious criminal activities.
But this blanket generalization belies some genuine progress in countries where reforms are making a measurable impact on operational effectiveness and integrity.