Unformatted text preview: roducts, the perishable supply chain is considered the most complex and hazardous, in terms of spoilage and goods movement. (SITPRO 2009). Predictability of time and procedures for perishable goods is highly desirable due to the limited shelf‐life of the items and associated financial loss. SMEs are major sources of rural (and non‐rural) employment. They are more prone to economic shocks. A study focusing on Asia‐Pacific Economic Cooperation (APEC) economies shows that cutting the days to clear exports by half could enable a small to medium‐size enterprise to increase its share of exports in total sales from 1.6% to 4.5% (WB Doing Business 2011). Ensuring efficient and predictable trade procedures would allow SMEs to avoid unnecessary risks and associated costs. It encourages SME participation in international trade, especially in agricultural sector where there is great intra‐regional export potential. At the macro perspective, if each South Asian country equaled the performance of the region’s top performer in terms of trading costs and delays (Pakistan has the lowest costs and India the best Logistics Performance Index), that would reduce trade costs by over 17% and improve in LPIs by 0.72, resulting in an increase in the value of agricultural trade of 18% and 27% respectively (Weerahewa 2009). Experiences in Singapore indicate significant reduction in processing time and costs by introducing ‘single window’ environment. It is reported that Singapore importers and exporters have gained 1% of GDP through the use of e‐documentation (SITPRO 2009). Studies show that each additional day that a product is delayed prior to being shipped reduces trade by at least one percent and delays have an even greater impact on developing country imports and exports of perishable agricultural products (Weerahewa 2009). 19 3. Less Tariff Barriers but no Corresponding Growth While the Tariff Barriers (TB) for agricultural goods have been reduced, for some, they are still considered high. TBs from European Union countries pose significant challenges to Asia‐Pacific countries, especially least developed countries for exports to European Union. For example, MFN Applied Tariff on apples imported from China is around 10% depending on the FTA they have with others countries. Table 1 ‐ Tariff on Frozen Shrimp Exports (030613) for Selected Asia‐Pacific Countries Countries Australia China India Indonesia Thailand Viet Nam Bangladesh European Union 13 5.92 13 5.92 5.92 5.92 0 Japan 1 1 1 0 0 0 0 Korea, Rep. 20 20 20 20 20 20 20 Norway 0 0 0 0 0 0 Singapore 0 0 0 0 0 0 0 United States 0 0 0 0 0 0 0 Average Tariff 6.8 4.5 5.7 4.3 4.3 4.3 3.3 Source: TRAINS 2010 In most parts of the world, tariff on Chinese Apples fell from 80% in 1992 to 10% in 2008. Tariffs on Chinese frozen and non‐frozen shrimp decreased respectively by 54% and 24% during this same period, reaching quotas of 6.2% and 9%. However, tariffs continue to curb trade. Despite reduction of tariffs for some agricultural products, market access for developing countries has not improved significantly. A major reason for not improving market access is high trade costs for agricultural products. ESCAP internal calculation shows that non‐tariff trade costs are higher for agricultural products in this regio...
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This document was uploaded on 02/26/2014 for the course BUSINESS 101 at Manitoba.
- Spring '14