GLOBAL: Unlocking secrets to trade success

Too much paperwork and other transporting delays can seriously affect a country's profit margin when exporting goods, reports a new Australian university study written with World Bank officials. By improving trade techniques and reducing the time it takes to transport goods from the factory to the ship, a country's trade performance increases, with developing nations especially prospering.

Dr Cong Pham, an expert on international trade at Deakin University in Melbourne, has released a new report with practical recommendations that could boost international exports even more than just cutting tariffs. "One day of delay is equivalent to a country distancing itself from its trade partners by 70 kilometres on average," said Dr Pham. "The impact is twice as much for landlocked economies."

Export red tape that restricts commerce has been a major point of discussion at the Doha Development Round negotiations at the World Trade Organization. These have a significant focus on farm products that are of key importance to poor countries.

The poorest countries often have duty free access to rich countries, Pham noted, so inefficiencies and baffling paperwork at their ports are now the most obvious focus for reform.

"Since many developing countries, particularly in Africa, have already benefited from existing duty free access provisions, estimates of increased exports by developing countries as a result of future trade liberalisation in OECD agricultural markets under a WTO agreement will remain limited unless export procedures are simplified," he said.

"For instance in Sub-Saharan Africa, it takes 48 days to get a container from the factory gate loaded on to a ship. Reducing that by 10 days is likely to increase exports by 10% in developing countries, [more] than any feasible liberalisation of in Europe and North America."

The study co-written by Dr Pham and the World Bank will be published in the upcoming Review of Economics and Statistics 2009, a US-based academic journal.