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competitiveness

Trade facilitation reform in Sri Lanka can drive a change in culture

Marcus Bartley Johns's picture

Two years ago, we started counting how many Sri Lankan agencies were involved in trade facilitation processes such as issuing permits and managing the movement of goods in and out of the country.  We counted at least 22 agencies in this assessment, and today, the Department of Commerce estimates that number at least 34 agencies are involved in issuing permits or publishing regulations that affect trade.
 
We know trade is critical to Sri Lanka’s future and that there are strong links between trade, economic growth and poverty reduction.

However, the trading community reports a lack of transparency, confusion around rules and regulations, poor coordination between various ministries and a dearth of critical infrastructure—you can see why trade has suffered in Sri Lanka.

 

When the World Bank evaluates a country’s performance in critical rankings like Doing Business, the ease of trading across borders is one of the benchmarks we consider. In this, and in other lists like the Logistics Performance Index, Sri Lanka is underperforming compared with its potential. Here, the average trade transaction involves over 30 different parties with different objectives, incentives, competence and constituencies they answer to, and up to 200 data elements, many of which are repeated multiple times. This environment constrains the growth of Sri Lanka’s private sector, especially SMEs.  
 
But now for the good news. By ratifying the World Trade Organisation Trade Facilitation Agreement, Sri Lanka has signalled its determination to intensify reform efforts.

Unlocking the Philippines’ urbanization potential

Judy Baker's picture

 

Fostering Livable Cities
The Philippines is one of the fastest urbanizing countries in East Asia and the Pacific. This can bring many opportunities for growth and poverty reduction. Cities become engines of growth if well planned and well managed.


Rapid urbanization in the Philippines has brought new jobs, educational opportunities, and better living conditions for some. However, it has also brought challenges, which you’ll see when you move around the streets of Metro Manila. It’s a large sprawling metropolitan area of over 12 million, with congestion that is estimated to cost US$70 million (₱3.5 billion) a day. When it rains, streets and homes are quickly flooded because many drains are clogged or non-existent. Because of lack of affordable housing, an estimated 11 percent of the city’s population live in slums. With 17 cities and municipalities in the metropolitan area, trying to tackle these challenges becomes stuck in deep complexities of urban governance and management. While other cities in the Philippines don’t face the scale of these challenges, they tackle similar issues.
 

What China’s Appetite for Meat means for Mongolia

Miles McKenna's picture
The concept of farm-to-fork can be complicated when it comes to meat. Fresh meat could be from the farm next door—or it could be from 10,000 kilometers away, having just arrived on a flight from the other side of the globe. With advances in cold chain transportation and logistics, distances that once took meat weeks to travel are covered in days, if not hours. And for a handful of low- and middle-income countries, meat exports are big business.  

Can Cameroon Become an Upper-Middle Income Country by 2035?

Souleymane Coulibaly's picture



After a decade of strong growth in the late 1970s and early 1980s, Cameroon was compared favorably with fast-growing East-Asian economies. This fame came to a sudden stop in the late 1980s when the country experienced one of the world’s deepest and most protracted recessions, triggered by large fall in the terms of trade and appreciation of the real exchange rate. Debts - previously at reasonable levels - mounted, banks failed and poverty increased. A 50% devaluation of the CFA Franc, a currency Cameroon shares with other former French colonies, in January 1994 pushed the foreign-currency denominated debt to increase to over 100 percent of GDP, triggering the Heavily Indebted Poor Countries (HIPC) debt relief process. Cameroon successfully exited HIPC in 2006. Since then, the authorities have set the goal to become a middle income country by 2035, anchoring their growth strategy on building infrastructure. After some initial success, with real growth steadily increasing from 1.9% in 2009 to 5.9% in 2014, the country is facing again some fiscal strains and risk of its debt distress has risen from low to moderate to high, in just 3 years.

The secret sauce of a ‘start-up nation’

Anabel Gonzalez's picture

Israel has one of the most admired innovation systems in the world. With the highest Research & Development (R&D) spending and venture capital investment as a percentage of GDP, the country has positioned itself as a global leader in research and innovation, earning the title of “start-up nation.”
 
Avi Hasson, Chief Scientist of the Ministry of Economy and Industry and Chairman of the Israel Innovation Agency, was at the World Bank Group last week to share some of the “secret sauce” behind Israel’s success in the innovation and entrepreneurship space.
 
Hasson highlighted the key role played by public-private partnerships over the last 40 years. Those partnerships have resulted in the establishment of an innovation infrastructure — including educational and technical institutions, incubators and business accelerators —anchored within a dynamic national innovation ecosystem built around shared social goals.
 
Specifically, to reduce the risk for investors, the government has focused on funding technologies at various stages of innovation — from emerging entrepreneurs and start-ups to medium and large companies. Strengthened by that approach, the Israeli ecosystem is maturing: according to Hasson, mergers and acquisitions have increased and exit profits have almost tripled over the last three years, with more and more new projects being started by returning entrepreneurs.

Economic diversification: A priority for action, now more than ever

Cecile Fruman's picture

The global economy is stagnating, and uncertainty about its future is rising. These trends weigh heavily on countries that depend on the production and export of a small range of products, or that sell products in only a few overseas markets.  Prices of the minerals and other basic commodities that dominate the exports of many poor countries have also declined sharply. All of this points up the need for diversification strategies that can deliver sustained, job intensive and inclusive growth.

The World Bank Group’s Trade & Competitiveness Global Practice (T&C), a joint practice of the World Bank and International Finance Corporation (IFC), is working with a growing roster of client countries eager to achieve greater economic diversification. This is a worthy goal regardless of economic conditions, but especially so now, as developing countries with sector-dependent economies face mounting pressures.

Chile is an example of a diversified economy, exporting more than 2,800 distinct products to more than 120 different countries. Zambia, a country similarly endowed with copper resources, exports just over 700 products — one-fourth of Chile’s export basket — and these go to just 80 countries. Other low-income countries have similarly limited diversified economies. The Lao People’s Democratic Republic and Malawi, for example, export around 550 and 310 products, respectively. Larger countries that export oil, such as Nigeria (780 products) and Kazakhstan (540 products), have failed to substantially expand the range of products they produce and export.


AJG Simoes, CA Hidalgo. The Economic Complexity Observatory: An Analytical Tool for Understanding the Dynamics of Economic Development. Workshops at the Twenty-Fifth AAAI Conference on Artificial Intelligence. (2011)
http://atlas.media.mit.edu/en/profile/country/chl/#Exports

While the sluggish global economy is creating economic problems for traditional exports, other economic trends offer new routes and opportunities for poor countries to diversify. The trend toward the spatial splitting up of production across wide geographic areas, and the emergence and growth of regional and global value chains, offer new ways for developing countries to export tasks, services and other activities. Value chains offer developing countries a path out of the trap of having to specialize in whole industries, with all of the cost and risk that such a strategy entails.

Much More to Competitiveness than Real Exchange Rates

Gonzalo Varela's picture
Policymakers often associate competitiveness with real exchange rates. Not too long ago, firms in Southern European countries attributed their difficulties to compete in global markets with a strong Euro. Worldwide, a lot has been discussed on the implications of an undervalued yuan on the chances of competing with Chinese firms. Also a few years back, Brazil’s finance minister argued that an ‘international currency war’ had broken out, as governments around the globe competed to lower their exchange rates to boost competitiveness.

All text messages are not created equal

Pierre Guislain's picture
Photo credit: Adam Fagen/Flickr
Eight months after the launch of the World Development Report 2016 on Digital Dividends, I am happy to report that our efforts to operationalize the findings are well under way. For digital technologies to benefit everyone everywhere, affordable access to broadband internet is key. This requires both robust broadband infrastructure, and the strengthening of analog complements to digital solutions, including a pro-competitive and effective regulatory framework, a sound business environment, good governance and digital skills.

One of our main areas of focus is the enabling environment – helping governments foster digital development by putting in place the right policies and regulations.

Now, what are some of the main issues?

First, across the world, but especially in developing countries, competitiveness continues to be dragged down by ‘red tape’, including numerous procedures, authorizations and delays to start a business or launch a service, costly and unreliable property registration, or stifling labor regulations. I am sure you are all familiar with the Doing Business report and the World Bank’s many programs to support business reforms worldwide.

While the digital industry also faces these regulatory hurdles, it is confronted with additional challenges.

Let me give you an example. With your phone in hand, you are about to send a text message to a friend. Your phone offers you a choice: to send the text message through your mobile operator, or to send it via the internet through an app. Depending on what platform you use, your text message will be taxed differently. All text messages are not created equal: different digital services are treated differently from a regulatory and fiscal point of view, with no real level playing field.

Nepal: How a 21st century trade policy framework could boost exports, jobs and economic growth

Cecile Fruman's picture
Equipped with unique tourist destinations, a strong national brand, and favorable trade positions with developed countries, Nepal is a country full of untapped potential. But several obstacles are holding it back from being a modern and globally connected economy. Some of these are unavoidable, such as its remote and landlocked location. But others, including outdated and restrictive trade and investment policies, lack of sufficient infrastructure, and a low capacity for adhering to quality standards for exports, could be resolved with a more modern trade framework.

Unlocking the transformative power of waterways

Karla Gonzalez Carvajal's picture


Transport history was in the making a few days ago when a Bangladeshi ship carried a consignment of
1,000 tons of steel and iron sheets from the Port of Kolkata in West Bengal to India’s northeastern states, through Bangladesh. This first-ever transshipment of transit goods marked the formal launch of transit trade and transport between India and Bangladesh using a combination of river and land routes. 
 
Senior government officials and top diplomats from both countries, including the Indian High Commissioner in Dhaka, the Bangladesh Minister and Secretary of Shipping, the Senior Secretary of Commerce, and officials of the Bangladesh Inland Water Transport Authority, attended an inaugural ceremony to observe the unloading of goods at Ashuganj Port on the bank of the Meghna River, according to media reports. The general cargo terminal at Ashuganj Port will be rehabilitated and modernized under the newly approved regional IDA project to support Bangladesh’s waterways to handle the loading and unloading of large volumes of cargo.

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