Things to KNOW
- Trade and transport are inextricably linked:
transport is a key sector for international trade, regional integration and ensuring balanced national development. Owing to excessive trade transaction costs, LLDCs remain largely marginalized in the global economy: their share of world trade in goods remains low at just 1.2%.
- LLDCs benefi t from preferential tariff schemes given to developing countries, least developed countries or African countries that offer duty and quota-free market access opportunities to over 90% of LLDCs’ exports (excluding arms). However, utilization of available preferential tariffs is severely impeded by the application of burdensome and non-harmonized rules of origin.
- Of the 31 LLDCs, only 22 are Members of the World Trade Organization (WTO). Not being a WTO member means missing out on benefi ts, including those on special and differential treatment.
- The economies of many landlocked developing countries are still reliant on few export commodities which oftentimes are high in bulk and low in value addition.
Things to DO
- Simplify, standardize and harmonize trade and transport procedures, processes and documents and enhance transparency of rules.
- Enhance the policy implementation by strong political commitment at the national level.
- Development partners should assist LLDCs to diversify their economic base, facilitate access to and encourage the transfer of technologies related to transit transport systems, and enhance value addition to their exports through development of their productive capacities. » The international community should provide greater market access for goods originating in landlocked developing countries to mitigate high trade transaction costs stemming from their geographical disadvantages.
- Transparent and development-friendly preferential rules of origin should be applied to increase the utilization rate of current GSP schemes and serve as an additional incentive for foreign direct investments in LLDCs.
- Increased and immediate technical assistance should be extended to LLDCs to ensure their effective participation in the WTO trade negotiations, particularly concerning trade facilitation and the implementation of its future agreement.
Key Achievements and Challenges
- Since the Almaty Conference, the group of LLDCs experienced enhanced export performance, with the value of merchandise exports growing in nominal terms from $33 billion in 2003 to $158 billion in 2010, an increase of 29 % from 2009. The value of imports has also increased from $50 billion to $142 billion during the same period.
- Since 2003, Armenia and Nepal have become WTO members and Lao PDR is completing procedures in order to join.
- Azerbaijan, Botswana, Kazakhstan, Mongolia, the Former Yugoslav Republic of Macedonia, Zambia and Zimbabwe have ratifi ed the International Convention on the simplifi cation and harmonization of Customs procedures (Revised Kyoto Convention), one of the most important trade facilitation instruments.
- Greater membership of landlocked and transit developing countries in major international transit transport conventions needs to be encouraged.
- Through widespread reforms of their transit transport policies, border delays and ineffi ciencies are being reduced and trade fl ows made smoother. Between 2005 and 2010, the average time taken by an LLDC to complete export formalities was remarkably reduced by nine days or 16%. The time to import dropped from 60 to 52 during the same period, indicating a 13% reduction. However, importing into an LLDC typically takes at least a week longer than for its coastal neighbors and times can vary widely, especially in Africa and Central Asia.