World Bank Report Assesses Progress in Encouraging Global Cross-Border Trade

The World Bank’s 2018 Doing Business analysis highlights international best practices in encouraging cross-border trade. The report concludes economies with the most efficient trading environments share common approaches:

  • Allow traders to exchange information with customs and other control agencies electronically;
  • Use risk-based assessments to focus physical inspections on a small amount of shipments, thus reducing customs clearance times; and
  • Encourage trade within customs unions or engage in other forms of bilateral or multilateral trade agreements, drastically reducing the time and costs of complying with “border formalities.”

The World Bank assessment of 2016-17 practices found that 33 economies internationally implemented reforms to facilitate more cross-border trade, with 22 improving their existing electronic systems to reduce the time required for documentary and border compliance. Eleven economies upgraded their trade logistical infrastructure. The regions implementing the most reforms were sub-Saharan Africa and East Asia/Pacific.

Key best practices identified include:

  • Upgrading trade logistics infrastructure
  • Promoting efficiency in product-specific inspections
  • Linking relevant agencies through electronic single window

Assessing the benefits of electronic processing of customs information, the World Bank said, “If implemented effectively, such a system saves precious time and money. It can also limit direct interactions with officials, which reduces opportunities for corruption.” The report notes there can be downsides to implementing new systems: they can impose significant infrastructure and training costs.

Information on the report:

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