Some of the headings included in this issue of the Development Economics Prospects Group (DECPG) weekly global economic newsletters are as follows: taking stock; major data releases; activity and inflation; financial markets; and commodity prices.
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The ease with which workers can move between sectors has a strong impact on the effects on labor markets of shocks such as changes in world prices or migration flows.
... See More + This paper introduces an approach to labor mobility with frictions under which worker capabilities (their efficiencies in different sectors) depend on their sector affiliation. If workers in sector a move to sector a', their efficiency shortfall due to a capability misfit compared to what is needed in a' (and possessed by workers already in a') is measured by a proximity parameter, 0 ≤ proxa,a' ≤ 1. If proxa,a' < 1, the efficient quantity reaching a' is below the physical quantity. In this setting, profit-maximizing producers are willing to pay the same wage per efficiency unit irrespective of worker origin and thus pay less efficient workers a lower wage per physical unit. This approach to labor mobility is tested in a static CGE model that is applied to an illustrative sub-Saharan African dataset with sector proximities defined using the approach of the product-space literature. Simulations of positive export price shocks show that, the higher the proximities, the stronger the labor reallocation and the welfare gains.
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Policy Research Working Paper WPS8151 JUL 20, 2017
Some of the headings included in this issue of the Development Economics Prospects Group (DECPG) weekly global economic newsletters are as follows: taking stock; major data releases; activity and inflation; financial markets; and commodity prices.
... See More +See Less -
Some of the headings included in this issue of the Development Economics Prospects Group (DECPG) weekly global economic newsletters are as follows: taking stock; major data releases; activity and inflation; financial markets; and commodity prices.
... See More +See Less -
This newsletter includes the following headings: monthly highlights; special focus; recent publications of prospects group; recent World Bank working papers; recent World Bank reports; table A: major data releases; table B: activity and inflation; table C: trade and finance; table D: financial markets; and table E: commodity prices.
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Unemployment rates in the Middle East and North Africa (MENA) region are among the highest in the world, especially for young graduates. Policy recommendations to date in the field of governance for private sector policymaking have been too general and too removed from concrete, actionable policy outcomes.
... See More + This report presents, for the first time to fill this policy and operational gap by answering the following question: what good governance features should be instilled in the design of economic policies and institutions to help shield them from capture, discretion, and arbitrary implementation? The report presents an innovative conceptual framework that encapsulates the governance features that can shield policies from capture, discretion, and arbitrary enforcement that limits competition. Based on this framework, a check-list of policy features in a wide range of policy areas relevant to private sector development policy is presented, notably in terms of: (i) the process of policy-making (ex-ante); (ii) the actual policies, regulations, and their implementation (for example, business regulations, procurement, financing, trade); and (iii) competition policy and other attributes like open-business and transparency measures that help identify, and prevent or deter anti-competitive market behavior and outcomes (ex-post). The report benchmarks eight countries along the framework and checklist of indicators, pointing, for each country, to policy gaps and poor governance features that make these countries prone to capture and discretion. The report offers a menu of operational and technical entry-points to engage the capture agenda in a concrete way, one that may be more politically tractable in some of the client countries.
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Belarus is a member of Eurasian Economic Union (EEU), bordering three European Union (EU) countries (Poland,Lithuania and Latvia), Ukraine and Russia.
... See More + As such, the country is strategically located for international transit trade. With the aim of boosting the country’s transit role, the government of Belarus is undertaking several infrastructure development projects and regulatory reforms aimed at trade facilitation. Government undertook a Two agencies at the border reform with the goal of reducing the number of agencies at the border to only two, namely Customs and the Border Police. Belarus’s efforts were supported by the World Bank Group (WBG), including the World Bank’s Transit Corridor Improvement Project (TCIP), which is financing the modernization of the transit Corridor-M6 Minsk-Grodno, and the Belarus Business Regulation and National Quality Infrastructure Advisory Project of the International Finance Corporation (IFC) with the aim of improving trade procedures. Border-crossing time release studies are powerful tools for analyzing trade logistics and measuring the performance of border agencies. Insights from a border-crossing study can help in designing and accelerating trade facilitation reforms. Preparing and carrying out an effective study is a challenging exercise in itself, as it involves sensitive data, and complex multi-agency and cross-country relationships. The border-crossing time release study for commercial cargo undertaken by the World Bank Group’s (WBG's) Trade and Competitiveness Global Practice team in Belarus in 2015 is an example that provides important lessons that may be useful for other countries. In this context, the border crossing time release study (BCTR study) was designed by the two WBG project teams, and implemented in close cooperation with the State Customs Committee of Belarus.
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The development objective of the Trade Logistics Project for Ethiopia is to enhance the performance of the Ethio-Djibouti corridor through improvements in operational capacity, efficiency, and range of logistics services at the Modjo Dry Port.
... See More + Some of the negative impacts and mitigation measures include: (1) land for land replacement shall be of minimum plot of acceptable size under the zoning law or a plot of equivalent size, whichever is larger, in either the community or a nearby resettlement area with adequate physical and social infrastructure systems as well as secured tenure status; (2) cash compensation for the harvest or product from the affected land or asset, equivalent to equivalent to ten times (ten years) the average annual income secured during the five years preceding the expropriation of the land; (3) cash compensation at full replacement cost based on type, age, and productive value of affected trees; (4) rehabilitation assistance (assistance with job placement, skills training); and (5) relocation assistance (costs of shifting and assistance in re-establishing economic trees and allowance up to a maximum of 12 months while short - term crops mature).
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Trade played a pivotal role during the transition of many countries in Europe and Central Asia to market economies. It forced a more efficient use of resourced and supported adoption of new technologies.
... See More + Going forward, trade will again be crucial as countries adjust to new specialization patterns in the world. The adjustment requires not merely tweaking of trade policies, but rather a rethinking of how labor markets and capital markets are organized.
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On request of the Ministry of Economic Development and Trade of Ukraine, an NQI Market Gap Assessment for Ukraine was conducted to inform various reform initiatives being implemented by the Government of Ukraine.
... See More + This Assessment is aimed at evaluating market gaps between supply of and demand for quality assurance services in Ukraine and includes analyses of the current status and capabilities of facilities providing quality assurance services and of producers’ demand for such services, particularly in relation to European Union market access.
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This is a statement by Mr. Roberto Azevedo, Director-General at the ninety-fifth meeting of the Development Committee held on April 22, 2017. He states that the World Trade Organization (WTO) commends the efforts that the World Bank Group has taken in supporting trade related infrastructure through the aid for trade initiative.
... See More + He welcomes the steps that the World Bank governors and senior management have taken to support implementation of the WTO's trade facilitation agreement through the trade facilitation support program. This agreement has the potential to deliver significant development gains and so he hope to continue this close collaboration. The World Bank and the WTO can continue to advance their shared goals of raising living standards and ensuring a brighter future for the world's poor.
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The development objective of Trade and Logistic Services Competitiveness Project aims to improve the efficiency of trade logistics services in Togo.
... See More + This project has three components. 1) The first component, Strengthening the Logistics Services and the Road Transport Sector, has the following three subcomponents: (i) Improving the Legal and Regulatory Framework for the Transport and Logistics Services Sector; (ii) Building Capacity of the Trade Logistics Services Sector; and (iii) Improving the Conditions to Modernize Trucks. 2) The second component, Improving Trade Facilitation, will provide support for the implementation of the World Trade Organizations (WTO) Trade Facilitation Agreement (TFA) for the improvement of the enabling environment to achieve higher-quality trade logistics services, including the necessary support to enhance the efficiency of customs administrations as well as other border and trade management agencies to improve overall trade facilitation. 3) The third component, Project Management, will provide support to the Project Coordination Unit (PCU) for the coordination and implementation of project activities, including procurement, financial management (FM), monitoring and evaluation (M and E), and reporting
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While precise impact of Brexit on the EU/UK trade and investment agreements with third countries will depend primarily on the terms of the withdrawal agreement to be concluded between them, most scenarios suggest an extensive process of amendment of the text and/or commitments in multilateral and bilateral agreements.
... See More + At the multilateral level, the UK will remain a WTO Member, but will no longer be represented by the EU. The separation of the UK obligations from the current EU lists of concessions and schedules of commitments will require amendments that, particularly regarding subsidies and quotas, may lead to a broader renegotiation process requiring consensus of all interested WTO members. At the bilateral level, the status of current EU PTAs with regard to the UK and its trading partners remains uncertain: Some elements suggest that these PTAs may no longer be valid for the UK, or that, even if legally valid, they will no longer cover the relationship between the UK and the third country. Further, EU agreements focusing on goods only will no longer apply to the UK. For these agreements to continue to apply, the UK and the third country will need to amend some aspects of the text of the agreement as well as of the lists of commitments. Investment treaties concluded by the UK with third countries will remain valid, and no amendment is in principle necessary. Parties could require amendments to the text of the treaty, due to a fundamental change in circumstances. LDCs and developing countries who benefit from the EU GSP will continue under this regime for the remaining EU member, but that GSP framework will no longer be applicable to the UK. The UK may introduce a new GSP regime of its own. In all cases, third countries who consider that Brexit has diminished the value of their negotiated commitments have the opportunity to request compensation in sectoral commitments or changes in the text of the agreements, or ultimately terminate the agreement The process of amending the trade and investment agreements requires comprehensive knowledge of their trade and investment flows with the EU and the UK.
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Policy Research Working Paper WPS8010 MAR 20, 2017
Vietnam has emerged as an Asian manufacturing powerhouse, carving out a role for itself within global value chains (GVCs). By specializing in assembly functions on behalf of primarily foreign firms, Vietnam has markedly increased its domestic value added, as reflected by its gross exports, which have grown by 16.6 percent annually between 1995 and 2011.
... See More + This export-oriented development strategy has created jobs, propelled economic growth, and reduced poverty. As successful as Vietnam has been, within the context of GVCs, its specialization has been in low value-added,end-production activities. Its challenge is to move up the value chain into higher value-added functions. Even more ambitious would be to grasp the opportunity to become an originator of products by nurturing a nascent set of domestic firms that have the potential to carve out an “invented in Vietnam” niche in local, regional, and global markets. In short, Vietnam is at a crossroads. It can continue to specialize in low value-added assembly functions, withindustrialization occurring in enclaves with little connection to the broader economy or society; or it can leverage the current wave of growth to diversify and move up the chain into higher value-added functions. Success will require Vietnam’s policy makers to view the processes of development differently and to take new realities of the global economy more fully into account.Vietnam at a Crossroads: Engaging in the Next Generation of Global Value Chains identifies policies and targeted interventions that will drive development by leveraging GVC participation while also taking into account major trade policy shifts and rapid technological advances. Readers will gain a strong understanding of Vietnam’s current and potential engagement with GVCs and will learn about strategic policy tools that can help developing countries achieve economic prosperity in the context of compressed development. Its findings will be of particular interest to policy makers, development practitioners, and academics.
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2016 is the fifth consecutive year of sluggish trade growth and the year with the weakest trade performance since the aftermath of the 2008 global financial crisis.
... See More + Current estimates of growth in the volumes of trade in goods and services range from 1.9 percent to 2.5 percent; preliminary high-frequency data suggest that merchandise trade volumes may have grown by slightly above 1 percent. The year 2016 is different from the other post crisis years, in that trade sluggishness is a characteristic of both advanced and emerging economies. Trade developments in 2016 continued to reflect enduring structural determinants, such as the maturing of global value chains (GVCs) and the slower pace of trade liberalization, as well as cyclical factors, notably slow global growth, the trough in commodity prices, and macroeconomic rebalancing in China. The increase in policy uncertainty may account for up to 75 percent of the worsening of the trade slowdown in 2016. In this report, the authors addresses three questions concerning recent trade developments: what is happening?; why?; and does it matter? The report is organized as follows: chapter one presents trade developments in 2016; and chapter two presents trade and productivity slowdowns: the role of global value chains.
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As the fate of the Trans-Pacific Partnership (TPP) hangs in balance, an evaluation of what it offers could inform current decisions and shape future negotiations.
... See More + The TPPs services component has been hailed as one of the agreement's major accomplishments. To assess the agreement's impact on national policy in the major services sectors, we created a new public database. This database reveals that TPP commitments seldom go beyond countries' applied policies, suggesting the explicit liberalization resulting from the agreement is limited only to a few countries and a few areas. However, the TPP enhances transparency and policy certainty because parties' services commitments cover more trading partners, more sectors and are in some cases closer to applied policies than their commitments under previous agreements. Furthermore, new TPP rules, including on state-owned enterprises, government procurement and competition policy, could enhance services market access. In particular, the TPP breaks new ground in prohibiting restrictions on international data flows, while at the same time creating unprecedented obligations on all parties to protect consumers from fraud and protect privacy. These dual obligations on importing and exporting countries represent a model for regulatory cooperation that could elicit greater market opening if applied to other areas.
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Policy Research Working Paper WPS7964 FEB 07, 2017
The Republic of Sudan’s seaports used to be known for congestion resulting from the slow processing of imported goods. In response, the government created an ad hoc National Committee on trade facilitation to help streamline the processing of goods coming in and to facilitate trade.
... See More + This smart lesson describes the steps taken in setting up the National Committee on Trade Facilitation and the challenges involved.
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One of the most important instruments of trade facilitation is the commodity nomenclature, which provides a definition of all goods subject to foreign trade.
... See More + The correct classification of goods forms the basis for determining the appropriate value of a good and for determining the customs duties imposed on a good on import or export. Customs statistics on foreign trade are derived from it, and those statistics in turn serve as a tool for the determination and implementation of customs policy. Commodity nomenclature is used not only at the national level, but also by the World Trade Organization, the World Customs Organization, the United Nations, and other international entities. Importers and exporters or investors in other countries visit customs nomenclature websites thousands of times a day to see the types and levels of customs duties and other charges and trade policy measures that particular countries apply. Trade policy regulations, rules of origin, and trade statistics in almost all of the developed and developing countries are designed and compiled on the basis of customs nomenclatures. This SmartLesson discusses how the Central Asia Trade Logistics Project worked with the Customs Administration of the Republic of Tajikistan on the development of its first national commodity nomenclature.
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