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    Boosting Market Access for Least Developed Countries

     

     
     
    © International Trade Centre, International Trade Forum - Issue 3/2005

    Photo: FAO/17417/H.Wagner Shrimp-fishing boats in Madagascar's Hell-Ville harbour are ready for the next catch. With over 80% of shrimp exports going to a single country, shrimp are a vulnerable sector for Madagascar.

    ITC encourages LDCs that are members of the WTO to tap into Market

    Access Map, its market analysis tool, free until September 2006.

    Least developed countries (LDCs) that are members of the World Trade Organization (WTO) can now benefit from free market intelligence to help them gain market access and shape trade negotiations. The United States Agency for International Development (USAID) is investing US$ 200,000 in ITC's Market Access Map so that LDCs can use this tool, free of charge, until 30 September 2006.

    Prior to the WTO Ministerial Meeting in Hong Kong in December, USAID is sponsoring three ITC workshops in Geneva to train LDC trade policy analysts on how to use Market Access Map, as well as a one-on-one help desk at ITC to assist trade officials in making full use of it in the lead-up to the Ministerial.

    "The Doha Development Agenda is an important opportunity for all countries, including the world's poorest. LDCs need to analyse their market access situation and identify new opportunities. But they don't always have the information they need to make informed decisions on their bargaining positions," says ITC Executive Director J. Denis Bélisle. "Market Access Map helps them to do this. It allows them to develop more effective bargaining positions both at the World Trade Organization and in regional trade talks."

    Help for LDCs comes at the right moment. The overall share of LDCs in world trade remains very low (less than 1%). While developing countries as a whole are improving their market access, the world's poorest countries are not. Market access for LDCs is stagnating. Of all LDC exports (excluding oil), 77% were admitted duty-free in developed markets in 1996; today this figure stands at around 72%.

    One step toward changing these trends and levelling the playing field is to make tariff information more available to LDCs. Normally this information is complex and scattered across many sources.

    Market Access Map brings this information together in one place, making tariff analysis more transparent. This tool makes it easier for LDCs to prepare their own bargaining positions - already in the run-up to Hong Kong. For example, countries can simulate the impact on tariffs of proposals tabled by other countries, and use that information to identify their negotiation points.

    Bird's-eye view of market access

    Market Access Map, a web-based tariff analysis tool, provides a comprehensive source of tariffs and market access measures applied at the bilateral level by 170 importing countries to the products exported by 239 countries and territories. Products are described at the most detailed level, the national tariff line.

    "This tool gives users a bird's-eye view of the world in terms of their current market access situation," says Mr Bélisle. "It allows them to plan for the future by optimizing trade strategies based on the market access status quo, and can help them try to change or improve current conditions."

    Find your competitive niche



    Several developing countries, including African, Caribbean and Pacific (ACP) countries, are already using Market Access Map to simulate tariff reductions or find products and markets that are important in the current WTO Doha Development Agenda talks and where they can be especially competitive.

    Pinpoint vulnerable exports

    Pinpointing which products and markets are vulnerable to competition is an important step in planning trade negotiation strategies. LDCs are often vulnerable to changes in market access status conditions, in view of the limited number of products that many of them export. In the case of Madagascar, for instance, 15% of its exports are shrimp; 86% of these shrimp are exported to France tariff-free, because of Madagascar's special ACP-related trading status with the European Union. (The ordinary tariff applied by France is 18%.) Market Access Map would enable Madagascan trade negotiators to identify the risk they would face if ordinary, or most-favoured nation, tariffs were drastically reduced as a result of multilateral trade negotiations. The market intelligence of Market Access Map would also enable Madagascar's trade promotion organization to develop a market diversification strategy by identifying alternative markets and sectors that offer favourable market access conditions.

    Used in over 90 countries

    Market Access Map has been piloted by companies, associations and governments in more than 90 countries and is contributing to trade strategies.

    Nigeria's Chamber of Commerce and Industry, for example, finished a study in July to identify untapped markets with favourable tariff rates for exports of cassava, cocoa and shrimp. The Chamber analysed current export performance in traditional and non-traditional markets, export performance of competitors, market access conditions faced by Nigeria and competitors, as well as products and markets where the country faces tariff escalation on value-added products, particularly cocoa.

    Moldova's Chamber of Commerce and Industry also completed a study in July to identify market diversification opportunities for wine exports, which traditionally have gone to the Russian Federation. The study looked at promising markets in terms of size, growth, geographical proximity and product acceptance. It also identified market access negotiation strategies to penetrate these markets.

    Easy to access

    As a web-based system, Market Access Map is easy to access, with no   need to install software. To get started, a user needs access to the Internet and a password. Within seconds, the "Quick Search" and "Compare Tariffs" modules display tariff information at the most detailed product level and compare all possible import destinations for the best tariff treatment. A glossary of tariff and trade terms and links to additional sources of information are also available.

    For example, in just a few clicks using Compare Tariffs, a cocoa butter exporter from Nigeria can confirm the 0% tariff in Belgium, Canada and the United States, but learns of a 24.6% general tariff in China.

    The "Advanced Analysis" modules, designed for trade policy analysts and negotiators, are easy to use, with instructions explaining each step in the process. A tariff reduction simulation is made easy through a menu of standard formulae or the option to "plug-in" and test an alternative formula.

    Free until end September 2006

    ITC, together with USAID, will advise national ministries, trade support institutions, industry chambers, exporters and other stakeholders in LDCs that are members of the WTO of their free access to Market Access Map and the back-up support available. Normally, access like this would cost each country US$ 5,000. This programme will continue until 30 September 2006.


    Contact Friedrich von Kirchbach, Chief of ITC's Market Analysis Section, at vonkirchbach@intracen.org or visit http://www.macmap.org for further information.



    Writers: Helen Lassen, ITC, and Dianna Rienstra, Phoenix Ink Communications