Post on 27-Mar-2015
transcript
OSVALDO ROSALES ECLAC 1
When trade liberalization is not enough:Making the case for Aid for Trade in
Latin America and Caribbean
Osvaldo RosalesDirector, Division of International Trade and Integration
Economic Commission for Latin America and the Caribbean (UN-ECLAC)
OSVALDO ROSALES ECLAC 2
Since 1980s the region underwent substantial reforms, including trade liberalization
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10
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50
60
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80
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Uru
gu
ay
Me
xico
Bra
zil
Pe
ru
Arg
en
tina
Ve
ne
zue
la
Co
lom
bia
Ecu
ad
or
Pa
rag
ua
y
Bo
livia
Gu
ate
ma
la
Co
sta
Ric
a
Ch
ile
Nic
ara
gu
a
1980s 1990 around 2003
> 100%
29%
10%
Latin America: Unilateral liberalization
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Despite progress in trade liberalization, Latin America and Caribbean remain less trade-oriented than other regions of the world
Sources: ECLAC official data, COMTRADE and World Development Indicators 0% 20% 40% 60% 80% 100% 120% 140% 160%
Brazil
Panama
Colombia
Argentina
El Salvador
Guatemala
Peru
Latin America and Caribbean
Uruguay
Venezuela
Bahamas
Ecuador
Barbados
Mexico
Honduras
Chile
Bolivia
Nicaragua
Dominican Republic
Jamaica
Costa Rica
Paraguay
Trinidad and Tobago
Guyana
0
10
20
30
40
50
60
70
80
East Asia& Pacific
Europe &CentralAsia
LatinAmerica &Caribbean
MiddleEast &NorthAfrica
SouthAsia
Sub-Saharan
Africa
World
Merchandise trade (% GDP), 2006
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The regional experience shows that market opening alone is not sufficient for sustained exports and economic growth
The growth rate in the region has not been sufficient to ensure convergence with the countries of the North.
In the last 20 years, only Chile, C. Rica, Panama and D.R show a clear trend of convergence.
GDP per capita / GDP per capita in US
0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0
Venezuela
Paraguay
Brazil
Mexico
Colombia
Latin America
Guatemala
Honduras
Ecuador
Bolivia
Nicaragua
El Salvador
Peru
Uruguay
Costa Rica
Dominican Republic
Panama
Argentina
Chile
Korea
Singapore
Ireland
2006
1990
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The export basket continues to be concentrated in few products
In most countries of the region, five products account for over half of all exports
High concentration of natural-resource based (oil, iron and steel, copper) and agricultural products (soy, sugar, beef, coffee)
Concentration of exports, 2006
0% 20% 40% 60% 80% 100%
Brazil
Latin America and Caribbean
El Salvador
Mexico
Argentina
Barbados
Uruguay
Honduras
Costa Rica
Colombia
Nicaragua
Peru
Paraguay
Chile
Guatemala
Guyana
Bahamas
Bolivia
Ecuador
Panama
Belize
Jamaica
Venezuela
% top 10 products
% top 5 products
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The problem is not lack of market access…
Proliferation of FTAs and integration agreements: Inside the region (CARICOM, CACM, Andean
Community and Mercosur) and Outside the region (especially with US, Canada, EU
and Japan)
ECLAC estimates that appx. 60% of LAC exports in 2005/2006 were covered by PTAs (sharp increase since mid-1990s)
Market access is still important, however to take full advantage of it requires actions to facilitate trade and to raise overall competitiveness.
The high cost of logistics and the red tape are often more restrictive that the actual trade barriers
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The key is an explicit strategy of competitiveness…learning from previous experiences of success and failure
Public-Private Alliances (PPA) to enhance competitiveness
and innovation
Active export promotion and diversification policies Enhancing SME´s export orientation Pursuing trade diversification towards products with
greater value-added and higher technology/knowledge content
Innovation policies linked with export promotion FDI´s attraction policies Education & human resources Infrastructure and logistic Institutional reforms
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…lowering the trading costs
Source: “Connecting to Compete”, 2007, The World Bank
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58
47
41
40
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0 10 20 30 40 50 60 70
Sub-Saharan Africa
Latin America and Caribbean
Middle East and North Africa
South Asia
East Asia and Pacific
Europe and Central Asia
% of respondents deeming the overall logistics costs to be high/very high
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Latin American countries are lagging behind in logistics performance
Source: Logistics Performance Index, The World Bank
0
5Logistics performance index
Customs
Infrastructure
International shipments
Logistics competence
Tracking & Tracing
Domestic logistics costs
Timeliness
Latin AmericaHigh-income countriesEmergent Asia countries (Malasya, China, Thailand, Indonesia, Vietnam y Philippines)
OSVALDO ROSALES ECLAC 10Source: “Doing Business”, The World Bank
The red tape adds to trading costs
0 10 20 30 40 50 60 70
Venezuela
Nicaragua
Paraguay
Bolivia
Colombia
Peru
Uruguay
Latin America & Caribbean
Ecuador
Chile
El Salvador
Honduras
Guatemala
Brazil
Costa Rica
Mexico
Argentina
Dominican Republic
OECD
Panama
Canada
United States
Time for import (days)
Time for export (days)
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Chile, Barbados and Mexico are the champions of competitiveness in the region, but the remaining countries rank low:
Source: World Economic Forum
Global Competitiveness Index rankings, 2007 (131 countries considered)
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20
40
60
80
100
120
140
Chile
Barba
dos
Mex
ico
Panam
a
Costa
Rica
El Sal
vado
r
Colom
bia
Brazil
Urugu
ay
Jam
aica
Hondu
ras
Trinid
ad a
nd T
obag
o
Argen
tina
Peru
Gua
tem
ala
Domin
ican
Repub
lic
Venez
uela
Ecuad
or
Bolivi
a
Nicara
gua
Surin
ame
Parag
uay
Guy
ana
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The role of regional integration is crucial Bigger and unified markets
Harmonization/ convergence of norms and rules
Productive integration
Regional value chains
“Translatinas”
Trade facilitation as a key aspect of internationalization strategy
mainly for small economies
for SME´s
to privilege cooperation efforts before negotiation process in the regional integration upgrading
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ECLAC’s vision and experience
A4T should focus on three aspects of trade-related capacity building: Strengthening national and regional
institutions responsible for trade and development
Helping firms to get more competitive in global markets, with emphasis in SMEs
Reducing domestic barriers to competitiveness (trade facilitation and infrastructure: physical, human and institutional)
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A4T in LAC economies
Provides a unique opportunity to address these challenges in a collective way and developing a broader and better coordinated approach to trade-related TA.
Implementation requires policy coordination and priority-setting among the national agencies and establishment of public-private partnerships to mobilize A4T programs.
An useful opportunity to build bridges among different visions on integration and trade in South America, enhancing cooperation aspects and delaying negotiations issues for better times .
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Three pillars of ECLAC’s trade-related capacity building and technical assistance
I. Formulation and implementation of a trade development strategy
Trade transformation and diversification, by sectors and markets
Incorporation of knowledge and value-added activities in goods and services.
Reinforce linkages between goods and service exports
Appropriate institutions necessary for technological advance and innovation in the export sector
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II. Development of local capacity
Compatibility and convergence among the various levels of trade negotiations: multi-, pluri-, regional and bilateral.
Some of them, N-S agreements with broad commitments on critical issues
Administration and implementation of trade agreements (including regional integration efforts)
In 2010, 10 LA countries will have FTA with USA; 11-18 and the Caribbean with the EU and 13 agreements will connect LA with Asian countries
Diffusion of information and trade related matters, focused on emerging markets such as China, India and ASEAN.
Joint-ventures of LAC governments oriented to explore new opportunities on trade and investment with Asian economies
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III. Trade Facilitation in areas related to:
Informatization of Customs procedures (Edocs, CEFACT) targeting SMEs;
Sanitary and Phytosanitary measures Technical barriers to trade; Physical infrastructure (maritime transport,
ports etc.).
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ECLAC’s contribution to the A4T Initiative
Collaborate with IDB and WTO on: Identification of specific projects and initiatives
for linking trade and development Participation in the design and implementation of
regional mechanisms to implement A4T/ Design of performance indicators
Support the WTO monitoring and evaluation work from the regional perspective
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I. Identification of projects and initiatives
Work with governments in collaboration with private sector on:
Implementation and administration of bilateral and multilateral trade agreements;
Definition of Action Plans in the trade facilitation area (C.America, next pilot plan)
Formation and functioning of A4T National Committees as mechanisms to articulate the A4T agenda.
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II. Regional coordination and cooperation mechanisms
To develop a regular regional mechanism to share AfT experiences between countries, donors, international agencies and the private sector;
Identify and implement technical assistance programs to support AfT.
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III. Support WTO monitoring and evaluation
Support information recompilation and systematization for the joint WTO/OECD database;
Providing information on the countries in the region to support WTO’s Trade Policy Reviews;
Host, organize and catalyze the AfT LAC Support Network.
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In conclusion…
ECLAC’s understanding of the region’s development process and close contacts to the countries and regional organizations enable it to provide significant support to the region’s AfT undertaking and assume a leadership role in conceptualizing, operationalizing and implementing the initiative in LAC.
THANK YOU.