The Global Enabling Trade Report 2008: Review

THE GLOBAL ENABLING TRADE REPORT 2008: REVIEW
ARTICLE BY ROSALIENE BACCHUS

COPYRIGHT © 2006-2012 rosalienebacchus.com. ALL RIGHTS RESERVED.
THIS PAGE WAS LAST UPDATED ON: 26 JANUARY 2012
WEB SITE DESIGNED WITH YAHOO! SITEBUILDER BY ROSALIENE BACCHUS

The WTO Doha Round of world trade negotiations, held in Geneva during week beginning July 20, 2008,
highlights the divergent views of developed and developing economies for liberalizing world trade.
Notwithstanding the controversies, WTO members agree on the importance of trade for spurring economic
development.

The Global Enabling Trade Report 2008, released by the World Economic Forum (see Footnote 1) on July 6,
2008, examines the factors or pillars that enable the ease of trade flow into a country and to its destination.
The Report is an ongoing research project made possible with the collaboration of international trade experts
and leaders from the logistics and transport industry. A new index, the Enabling Trade Index (ETI), quantifies
the trade-flow enablers in 118 countries worldwide.

The enablers, referred to as subindexes, assess market access, border administration, transport and
communications infrastructure, and the business environment. These four subindexes are composed of the
pillars that enable trade. The ten major pillars considered comprise tariff and non-tariff barriers, proclivity to
trade, efficiency of customs administration, efficiency of import-export procedures, transparency of border
administration, availability and quality of transport infrastructure, availability and quality of transport services,
availability and use of information communication technologies (ICTs), regulatory environment, and physical
security.

Based on the scores obtained for all four subindexes, the Report ranks the 118 countries of the study group
(see Footnote 2). The top ten ranking economies, with their respective ETI scores in parentheses, are Hong
Kong (6.04), Singapore (5.71), Sweden (5.66), Norway (5.65), Canada (5.62), Denmark (5.62), Finland (5.61),
Germany (5.58), Switzerland (5.58), and New Zealand (5.52). Scores range on a scale of one to seven.

The Table below compares the results of select countries of the study group. Divided by world region, the
countries include those that obtained the highest rank for their region: Hong Kong, Sweden, Canada, Chile,
United Arab Emirates, and Mauritius. Some of the world’s major economies and emerging economies are
added for comparison. It is noteworthy that the BRIC (see Footnote 3) emerging economies do not score well in
market access.

Guyana and Jamaica are the only CARICOM member states numbered among the study group. With an ETI
score of 3.80, Jamaica is well-placed in the 66th position, way ahead of Brazil, South America’s largest
economy. Guyana lags behind in the 114th position with a score of 2.95.

An examination of Guyana’s Enabling Trade Index in detail reveals a bleak situation. The country has a
competitive trade advantage in only four aspects of the ten pillars: cost of import, airport density, internet
users, and ease of hiring foreign labor. Areas of greatest competitive disadvantage include openness to
multilateral trade rules, burden of customs procedures, effectiveness and efficiency of clearance, paved roads,
air transport, port infrastructure, ease and affordability of shipment, competence of the logistics industry,
timeliness of shipments in reaching destination, firm-level technology absorption, reliability of police services,
and business costs of crime and violence.

The Enabling Trade Index is an invaluable tool in understanding the forces within an economy that hamper or
facilitate the flow of goods and services.

Table: The Enabling Trade Index 2008: Select Countries

Footnotes:

The World Economic Forum, first conceived in January 1971, is an independent, international organization incorporated as a
Swiss non-profit foundation. They believe that economic progress without social development is not sustainable, while
social development without economic progress is not feasible. The Forum’s 1,000 member companies are at the forefront of
driving the world economy forward. For more information, visit the Forum’s website at www.weforum.org.
The Enabling Trade Index 2008 can be viewed on the website of the World Economic Forum.
The BRIC emerging economies are Brazil, Russia, India and China.

Article published in the Guyana Journal, Guyana Journal Publication, Inc., New York, USA, August 2008, p.10.
Reprinted with permission.