By Arthur Bayhan
The World Economic Forum released its Global Enabling Trade Report of 2014 in Geneva on April 1, 2014.
The report places Azerbaijan in the 77th position out of 138 benchmarked economies.
Trade Index of 2014, which ranks Azerbaijan at 77 out of 138 countries,
has four sub-indexes which are: Market access that ranks Azerbaijan at
66, border administration ranks Azerbaijan at 94, infrastructure ranks
Azerbaijan at 45, and operating environment positions rank Azerbaijan at
The report highlights that Azerbaijan's achievements in
improving trade facilitations measures enjoy a competitive advantage in
the region in the following areas: Customs transparency index (39), Ease
of compliance with government regulation (19), Openness to foreign
participation index (34), Ease of hiring foreign labor availability
(30), Business costs of crime and violence (20), Quality of transport
infrastructure (45), Quality of air transport infrastructure (46),
Quality of railroad infrastructure (35), Efficiency of transport mode
change (43), ICT use for business-to-business transactions (46), and
Internet use for business-to-consumer transactions (50).
Report also shows the areas that the Azerbaijani government needs to
undertake more interventions to improve its competitive disadvantage.
There is a need to focus on the areas, especially, of the import and
export transactions. These areas are the number of the documents needed
for import, which ranks Azerbaijan at 126 out of 138 countries included
in the Report. The cost to import (US$ per container) ranks Azerbaijan
at 127, number of documents to export ranks at 121, cost to export, (US$
per container) ranks it at 134, logistics competence ranks it at 134,
and judicial efficiency & impartiality in commercial disputes ranks
it at 106.
In the last couple of years Azerbaijan has been
continuing to move up in the list of the global competitiveness rankings
and is placed currently in the 39th position out of 148 countries.
Indeed, Azerbaijan is leading even the most of the transition economies,
even some of the new members of the European Union in the global
competitiveness report of the WEF's Global Competitiveness Report of
In a rapidly integrating global economy, long-term growth
will depend increasingly on trade facilitation and competitiveness
towards developing a dynamic private sector to benefit from a globalized
economy. To maintain its competitiveness advantage in trade
facilitation in the region Azerbaijan needs to focus on the weaknesses
identified in this report including lifting the existing import and
The Global Enabling Trade Report assesses the
trade enabling landscape of 138 ranked economies, providing insight into
the trade facilitation reforms. The Report also refers to the measures
agreed by 159 members of the World Trade Organization (WTO) in December
2013, in Bali/Indonesia. The Report assesses and benchmarks through its
enabling trade index (ETI) various dimensions of enabling trade dividing
them into four overall areas:
1. Market access which refers to
the measures of a country's tariff regime, as well as tariff barriers
faced and preferences enjoyed by a country's exporters in foreign
2. Border administration which assesses the quality, transparency and efficiency of border administration of a country.
3. Infrastructure that assesses the availability and quality of transport
infrastructure of a country, associated services, and communication
infrastructure, necessary to facilitate the movement of goods within the
country and across the border, and
4. Operating environment which
measures the quality of key institutional factors impacting the business
of importers and exporters active in a country.
findings show that Singapore tops the overall rankings in the global
enabling trade, Hong Kong placed in the second position and followed by
Netherlands in the third. New Zealand ranked at 4, Finland at 5, United
Kingdom at 6, Switzerland at 7, Chile at 8, Sweden at 9, and Germany at
10. The United States ranked at the 15th position out of 138 economies
ranked in the report.
The report shows Georgia tops the countries
in the region and ranked at 36 out of 138 countries which is followed
by Azerbaijan at 77, Ukraine at 83, Moldova at 92, Kazakhstan at 94,
Russian Federation at 105, and Kyrgyzstan at 109. Tajikistan, Uzbekistan
and, Turkmenistan are not covered by the report.
Enabling Trade Report is one of the important policy tools for the
governments to prepare a ground to benefit from trade to boost the
economic growth and generate jobs. The Report stipulates that reducing
even a restricted set of trade barriers halfway to the level of global
best practices would yield close to a five percent increase in global
GDP. To achieve these gains, governments would need to take a more
supply-chain focused approach to trade reform, both in international
coordination and domestic action. Indeed, the trade facilitation is the
driving force of economic growth and growth is a crucial instrument to
generate employment and in turn reduce poverty. Developing regions and
smaller enterprises would see the largest gains from the WTO's measures
stipulated in the Bali package.
The, so-called, WTO's Bali
package contains a number of measures, including trade facilitation,
agriculture and cotton, and development issues to promote economic
growth and jobs creation in developing economies. Basically, the WTO's
Bali package aimed at moving forward the process of the Doha round.
Furthermore, the Bali Package in favor of the developing nations and
developed countries alike.
The Global Enabling Trade Report 2014
is an important effort to remind the assessed and benchmarked countries
leaders to move forward the Bali arrangement has the potential to move
the global trade forward. While moving forward with the Bali package,
the efforts on bilateral, regional and inter-regional free trade
agreements will also continue to contribute to improving the global
system of trade facilitation.Arthur Bayhan is a senior advisor
on economic growth and competitiveness with more than 20 years of
project implementation experience in the areas of investment and trade
facilitation, sector competitiveness, and public-private partnership
development. He worked as chief of party for USAID, head of private
sector development at OECD, and as advisor at the EU Commission. He is
engaged in the highest levels of governments and the private sector to
improve framework conditions for business enabling environments
including trade and investment facilitation, developed sustainable
economic institutions in Central Asia, Caucasia, Russia and in other
transition economies as well as in South- and Southeast Asia. He is a
German national and can be reached at: email@example.com.