72557 v1 World Trade Indicators 2009/10 Central African Republic Trade Brief Trade Policy face a very favorable trading environment (1.3 percent for the country versus averages of 3.9 percent and 5.6 The Central African Republic’s tariff policy is based percent for the SSA region and low-income countries, on the Common External Tariff (CET) of the Central respectively). Similarly, the country faces a low African Economic and Monetary Community weighted average tariff (including preferences) of 1.1 (CEMAC), which was adopted in 1993. However, due percent from the rest of the world. This value to fiscal problems, the country obtained a waiver on corresponds to tariffs of 0.2 percent and 1.3 percent application of the CEMAC generalized preferential for agricultural and non-agricultural exports, tariff (GPT) and, consequently, grants no tariff respectively. In 2008, the national currency, the CFA preferences to any country. Its MFN Tariff Trade franc, appreciated by 7.5 percent in real, trade- Restrictiveness Index (TTRI)1 of 21.8 percent, which weighted terms, reducing the competitiveness of the is almost double the Sub-Saharan Africa (SSA) country’s exports. regional and low-income country averages of 11.3 percent and 11.6 percent, respectively, indicates a As negotiations between the Central Africa group and relatively more restrictive trade regime than its the EU towards a full Economic Partnership comparators’. Based on the MFN TTRI, it ranks at the Agreement (EPA) could not be completed prior to the bottom out of 125 countries (where 1st is least December 2007 deadline, the preferences under the restrictive). The agricultural and non-agricultural Cotonou Agreement elapsed. The Central African sectors enjoy a similar level of tariff protection with Republic, however, maintains a similar level of TTRIs of 23.0 percent and 21.6 percent, respectively. preferences to the EU market under the “Everything Based on the TTRI, the Central African Republic But Arms� (EBA) initiative for least developed ranks last out of 125 countries. The average MFN countries. The country continues to negotiate an EPA applied tariff has remained relatively stable over time with the EU as part of the Central Africa group. and was 17.9 percent in 2007. The maximum MFN tariff imposed on imports was 30 percent as of 2007. The country’s trade policy space, as measured by the Behind the Border Constraints wedge between bound and applied tariffs (the Regarding its business environment, the Central overhang), was also 20 percent. Regarding its African Republic ranked last in the 2010 Ease of commitment to liberalizing services trade, the Central Doing Business out of 183 countries, the same as its African Republic ranks 140th (out of 148) on the rank in 2008. With relatively high costs of exporting GATS Commitments Index. and importing, the country, which is landlocked, fares poorly as well in the Trading Across Borders category of the Doing Business Index with a rank of 181st, External Environment suggesting a less conducive environment for trade As judged by the Market Access TTRI2 including than its comparators’. Among the countries ranked on preferences, the Central African Republic’s exports the index, other than Chad, the Central African Republic has the highest costs of importing and exporting. Unless otherwise indicated, all data are as of August 2009 and are drawn from the World Trade Indicators 2009/10 Trade Outcomes Database. The database, Country Trade Briefs and Trade-at-a-Glance Tables, are available at Real trade growth (in constant 2000 US dollars) http://www.worldbank.org/wti. decelerated from 13 percent in 2007 to 8.6 percent in 2008, with further deceleration to 3 percent expected If using information from this brief, please provide the in 2009. Export growth was 6.9 percent in 2008, down following source citation: World Bank. 2010. “Central from 12.7 percent in 2007, while import growth African Republic Trade Brief.� World Trade Indicators decreased to 10 percent from 13.2 percent in 2007. 2009/10: Country Trade Briefs. Washington, DC: World Both export and import growths are expected to Bank. Available at http://www.worldbank.org/wti. World Trade Indicators 2009/10 Central African Republic Trade Brief decelerate to 4.1 percent and 1.8 percent, respectively, References in 2009. African Economic Outlook. 2009. Central African Republic. In nominal terms, trade grew at an estimated 20.3 African Economic Outlook. May 27, 2009. percent, marginally above the growth rate of 17.7 . rate of 17.7 percent in 2008 compared to 11.9 percent Europa. 2009. “Africa, Caribbean, Pacific—Regional in 2007. Imports also experienced higher growth of negotiations of Economic Partnership Agreements.� 21.6 percent in 2008 compared to 20.8 percent the Europa. March 2009. . grown at 17.7 percent in 2008, compared to 12 percent World Trade Organization (WTO). 2004. “Trade Policy the year before, but are expected to fall by 4.2 percent Review—Central African Republic.� WTO. July 30, in 2009. Services exports performed even better in 2007. . in 2007, although they are expected to grow at only 3.2 percent in 2009. Notes 1. TTRI calculates the equivalent uniform tariff that would keep domestic welfare constant. It is weighted by import shares and import demand elasticity. 2. MA TTRI calculates the equivalent uniform tariff of trading partners that would keep their level of imports constant. It is weighted by import values and import demand elasticities of trading partners.