ENHANCING THE SHARE OF LLDCs IN. (Priority 3 of APoA) Dr Mia Mikic Chief, Trade Policy and Analysis Section Trade and Investment Division
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1 ESCAP/OHRLLS/ECE/Government of Lao PDR Final Regional Review of the AlmatyProgrammeof of Action 5 7 March 2013, Vientiane, Lao PDR ENHANCING THE SHARE OF LLDCs IN GLOBAL TRADE FLOWS AND TRADE FACILITATION (Priority 3 of APoA) Dr Mia Mikic Chief, Trade Policy and Analysis Section Trade and Investment Division
2 Important messages The WTO accession need to be kept high on the agenda for the LLDCs still not members of the WTO Continuing efforts should be put towards regional integration andintraregional trade, including through APTA Aid for Trade (AfT) initiative could be more effectively used in design ofadequate policies andmeasures The LLDCs should be actively involved in implementing the ESCAP resolution 68/3 on enabling paperless pp trade The LLDCs are encouraged to fully utilize the tools to enhance trade facilitation and improve trade policy developed by international organizations (e.g., some tools developed by UNNExT, ESCAP) 2
3 Presentation structure 1. Recent trends and developments in trade of Asian LLDCs 2. Progress made in Priority 3 of APoA 3. ESCAP s contribution 4. Key recommendations 3
4 RECENT TRENDS AND DEVELOPMENTS IN TRADE OF ASIAN LLDCS 4
5 Partial export recovery for LLDCs Persistent trade surplus of Asian LLDCs was driven by exports ofnatural resources Exports were seriously hit by the 2008 global economic crisis Only partial export recovery in 2010 (no data for 2011for larger LLDCs) 5
6 Exports are highly concentrated Stark difference in export and import structure Imports are diversified 6
7 Exports recovery hindered by export direction LLDCs exports mainly flow to ROW Exports to developing AP were about 30% (2010) Intraregional imports were important t Almost 60% of imports came from the region 7
8 Trade in services structure 8
9 PROGRESS MADE IN PRIORITY 3 OF APOA 9
10 Progress on specific actions 1) WTO accession 2) Market access 3) Trade facilitation 10
11 1) WTO membership Lao PDR became the 158 th member on 2 February 2013, and Tajikistan the 159 th member on 2 March 2013 Afghanistan, Azerbaijan, Bhutan, Kazakhstan, and Uzbekistan all in various stages of negotiations Despite APoA and calls for easier accession especially for those with LDC and LLDC status, not much progress seen in Geneva As DDA has not moved forward, developing countries still could get in a position to influence multilateral t l negotiations 11
12 2) Market access: MLT system Proportion of exports of all products (except arms) into developed country markets under zero duty 12
13 Market access: preferential trade agreements Economy Agreement in force Trade coverage in percent, average Export Import Afghanistan Armenia* Azerbaijan Bhutan Kazakhstan Kyrgyzstan* Lao PDR* Mongolia* Nepal* Tajikistan* Turkmenistan Uzbekistan Note:* denotes WTO members 13
14 Better market access, but supply side export diversification is too weak China India Thailand Hong Kong ng, China Malaysia Ind ndonesia Singapore Philippines Vietnam Pakistan Sri Lanka Bang ngladesh Nepal Cambodia Mongolia Lao PDR Afgh ghanistan Papua New Guinea Fiji Maldives Marshall all Islands Vanuatu Kiribati Bhutan Samoa Tonga Solomon on Islands Micronesia Palau 0 Source: ARTNeT Policy Brief 19, 2009 Country 14 No.. of 8-Digit Expor rt Products
15 3) Progress in trade facilitation (time to export)
16 LLDCs trade costs up to 7 times higher than other developing countries Comprehensive trade costs (CTC) between selected economies and the USA *Source: ESCAP Trade Cost Database (Ver.2, 2011) Note: NT CTC: CTC excluding tariff costs Source: World Bank, LPI 2012, No data on Turkmenistan 16
17 Capacity to trade still underdeveloped Mongolia Tajikistan Logistics Performance Index (LPI) Score Nepal Afghanistan Kyrgyz Republic Uzbekistan Azerbaijan Lao PDR Bhutan Armenia Kazakhstan Hong Kong, China Singapore Source: World Bank, 0 LPI 2012, No 1 data for Turkmenistan
18 Trade related services Countries Enabling Trade Index (ETI) Getting Credit Availability and quality of Global ranking Global ranking transport service (out of 132) (out of 185) (score, 1 7) Afghanistan 154 Armenia Azerbaijan Bhutan 129 Kazakhstan Kyrgyzstan Lao PDR 167 Mongolia Nepal Tajikistan Turkmenistan Uzbekistan
19 ESCAP s scontribution o 19
20 ESCAP TA to LLDCs in trade and trade facilitation Gaps of ESCAP LLDCs Support areas mechanisms 1) Lack of National Level human and Policy making financial Programme implementation resources Stakeholder coordination 2) Lack of technical and Subregional Level Networking institutional Knowledge sharing capacity Transit cooperation 3) Lack of political and Regional level policy Networking support Knowledge sharing Regional integration 20
21 ESCAP TA for PTA negotiations, trade and investment reforms and business development Preparation of the negotiation mandate Audit of domestic regulation Setting consultative and coordinating processes Inputs for formulation of negotiation strategies and positions Impact assessment Capacity building for all aspects of negotiations 21
22 UN Network of Experts for Paperless Trade in Asia and the Pacific (UNNExT) Partnership 22
23 Asia Pacific Trade Agreement (APTA) MAIN FEATURES The only REGION WIDE trading agreement Significant market potential OPEN to all developing countries BRIDGEto other RTAs It WORKS simple and operational rules of origin allow utilization of preferences Margin of preferences locked to MFN so NO deterioration of preferences Ever EVOLVING SAFTA ECOTA APTA Extending into new areas of integration: Trade facilitation Trade in services Investment Non tariff barriers AFTA PICTA 23
24 Some key recommendations to further trade and trade facilitation ti The WTO accession need to be kept high on the agenda for the LLDCs still not members of the WTO Continuing efforts should be put towards regional integration andintraregional trade Aid for Trade (AfT) initiative could be more effectively used in design ofadequate policies andmeasures The LLDCs should be actively involved in implementing the ESCAP resolution 68/3on enabling paperless trade The LLDCs are encouraged to fully utilize the tools to enhance trade facilitation and improve trade policy developed by international organizations (e.g., some tools developed by UNNExT, ESCAP) 24
25 In summary Potential for integration of LLDCs into expanded South South trade and investment should be di driven by policies i and action to support inclusive and sustainablestainable developmentelopment especially for agriculture and services improve transfer of technology reduce trade costs enhance market access utilize aid, especially Aid for Trade, effectively facilitate movement of people between the countries and subregions (tourism, education, temporary work, etc). 25
26 THANK YOU Please visit for more details:
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