Fi l R i f th

Finall Regional
Fi
R i
l Review
R i
off the
th
Almaty Programme of Action for the
Landlocked Developing Countries
Nikolay Pomoshchnikov
Head
ESCAP North and Central Asia Office
LLDCs in North and Central Asia
(NCA)
• ESCAP North and Central Asia Office (ENCA) provides
assistance to 9 countries of the subregion,
subregion seven of which are
landlocked developing countries, namely: Armenia, Azerbaijan,
Kazakhstan, Kyrgyz Republic, Tajikistan, Turkmenistan and
Uzbekistan.
• These LLDCs belong to the group the development of which
over the past decade has been extremely difficult due to
diverse shocks and disruptions created by the break-up of the
former Soviet Union. These changes adversely affected
international trade as the number of borders to be crossed
increased and the earlier unified transit rules became different
for each country and access to markets and transit rights
became cumbersome and costly.
Ch ll
Challenges
Faced
F
d
• Building transport infrastructure and bridging infrastructure
gaps
• Border-crossing issues
• Removing transportation inefficiencies
• Transit policy issues
• Harmonization of legal regimes
• Integrated
g
approach
pp
to trade and transport
p
facilitation
• Addressing non-tariff measures
• Deepening regional integration
Doing Business Report 2012 (World Bank)
For landlocked county it is 3 times more expensive to import
and export comparing to coastal countries.
LLDCs Growth Rates
The LLDCs in the subregion face a number of challenges and
demonstrate various rates of economic growth
Armenia
Azerbaijan
Kazakhstan
Kyrgyzstan
T jiki
Tajikistan
Turkmenistan
Uzbekistan
Real GDP growth rate (annual, %)
2005-2007 2008
2009 2010 2011 2012*
13.6
6.9
-14.2 2.6
4.3
7.7
28.6
10.8
9.3
5.0
0.1
6.7
9.8
3.3
1.2
7.0
7.5
7.8
3.8
8.4
2.3 -1.4
5.7
11.0
7.2
2
7.9
9
3
3.4
4
6
6.5
7.4
4
10
10.7
12.0
10.5
6.1
9.2
9.9
10.0
79
7.9
90
9.0
8
8.1
1
8
8.5
5
8
8.3
3
12
12.5
5
Source: ESCAP, Economic and Social Survey of Asia and the Pacific 2012, Bangkok.
* Estimates
Productive capacity of NCA LLDCs
Standard deviations from the world average*
Source: ESCAP 2011
World average equals to 1
Difference in export and import structure
Difference in export and import structure
• Imports are
di
diversified
ifi d
• Exports are
highly
concentrated
Partial export recovery for LLDCs
• B
Because off reliance
li
on
resources and
commodities,
co
od t es, countries
cou t es
are vulnerable to price
and demand shocks
• Exports were seriously
y the 2008 g
global
hit by
economic crisis
• Only partial export
recovery in 2010 (no
g
data for 2011 for larger
LLDCs)
Exports did not recover because they target non
nonAsian markets
• LLDCs’ exports
mainly
y went to
outside the region
Exports to
developing AP were
about 30% (2010)
• Intraregional imports
were important
Almost 60% of
i
imports
t came from
f
the region
Challenges and gaps of LLDCS in
trade facilitation: ESCAP findings
*
Challenges
1) Inadequate trade and transport infrastructure and logistics services;
2) Cumbersome documents and procedures
procedures, and excessive physical
inspections;
3) Insufficient availability and use of information and communication
technologies;
4) Lack of appropriate regional transit regimes and insufficient participation in
multilateral cooperation on transit;
5) Weak institutional and human capacities;
6) Lack of inductive legal and regulatory systems; and
7) Uneven trade/transit facilitation performance across ESCAP region.
Major Gaps of LLDCs in Overcoming Challenges*
1) Lack of human and financial resources,
2) Lack of technical and institutional capacity,
3) Lack of political and policy support
*Asia Pacific Trade facilitation Forum 2009
Official Development Assistance
Armenia, Kyrgyz
y gy Republic
p
and Tajikistan
j
are receiving
g more than 63%
of the total ODA of the region. Distribution of ODA among LLDCs is
quite diverse, ranging from US$44.65 million for Turkmenistan to
US$436 65 million for Tajikistan in 2011.
US$436.65
2011 Armenia,
Armenia Kyrgyz Republic and
Tajikistan received US$1159.84 millions of the total US$1816.38
millions received by LLDCs of the subregion same year.
Countries
Armenia
Azerbaijan
Kazakhstan
Kyrgyz Republic
Tajikistan
T k
Turkmenistan
it
Uzbekistan
Source: OECD ((2012),
), World Bank ((2012))
Country programmable aid
358
187
158
367
318
35
263
Net ODA
342.82
153.11
223.93
380.37
436.65
44 65
44.65
234.85
Country Programmable Aid (CPA)
The CPA will mainly increase by 2013 in comparison with 2010.
2010
Azerbaijan, Kazakhstan and Turkmenistan will see the decrease of
y average
g 3.36%. Significant
g
increase of CPA is expected
p
to
CPA by
Uzbekistan.
CPA
Countries
Armenia
Azerbaijan
Kazakhstan
Kyrgyz Republic
Tajikistan
Turkmenistan
Uzbekistan
Source: OECD CPA.
2010
2011
2012
2013
318
195
165
235
358
36
217
358
187
158
367
318
35
263
387
192
163
306
292
35
352
366
193
159
219
294
34
374
% change
from 2010
to 2013
15%
- 1%
- 3.6%
23.8%
17.9%
- 5.5%
5 5%
72.3%
Domestic savings and FDI flows
Countries
Armenia
A b ij
Azerbaijan
Kazakhstan
Kyrgyz Republic
Gross Domestic Savings
(% of GDP)
2001-2003
2009-2011
0.87
5.67
26 5
26.5
49
32.27
43.63
12.27
-0.63
FDI inflows
(% of GDP)
2001-2003
2009-2011
4.09
6.71
23 81
23.81
1 49
1.49
10.03
8.68
1
8.56
Tajikistan
Turkmenistan
Uzbekistan
-0.67
36.83
23 03
23.03
1.96
2.66
0 79
0.79
-22.15
51.2
36 43
36.43
0.076
16.41
3 26
3.26
Importance of Intra
Intra-Central
Central Asia Trade in Total
Central Asia Trade
Intra- Central Asia Exports
Total Central Asia Exports
Intra- Central Asia Exports as a % of Total
C t l Asia
Central
A i Exports
E
t to
t World
W ld
Intra- Central Asia Imports
Total Central Asia Imports
Intra- Central Asia Imports as a % of Total
Central Asia Imports to World
22.74
74
59.0
4.7
3.01
53.90
5.6
(Values in billion US $)
Potential for Intra- Central Asia Trade
X→/
M↓
Kazakhstan
Kyrgyzstan
Tajikistan
Year
2020
2025 2030
2020
2025
2030 2020
2025
2030
2020 2025
2030
2020
2025
2030
Kaz
-
-
-
272
544
921
103
262
480
126
213
310
4472
7903
12556
Kyr
128
133
181
-
-
-
934
1029
1259
140
149
155
169
232
298
Taj
68
189
223
845
1429
1598 -
-
-
2234 3033
3892
299
431
571
Turk
78
158
247
4570
6682
8977 98
187
282
-
-
-
693
1042
1435
Uzb
1267
1606 2156
97
214
363
255
364
132
273
452
-
-
-
155
Turkmenistan
Uzbekistan
• LLDCs in Central Asia
process of
are in the p
integration into global
economy (via WTO) or
ASIA (via PTAs)
• Most PTAs are with
each other or
g
g countries
neighboring
• FDI inflows linked to
extractive industries
rather than to export
diversification
NCA WTO list of members and accession dates
Armenia
5 February 2003
Georgia
14 June 2000
y gy
20 December 1998
Kyrgyzstan
Russia
22 August 2012
Tajikistan
2 March 2013
Observers
Azerbaijan
Kazakhstan
U b ki t
Uzbekistan
Neither members or observers
Turkmenistan
Market access through preferential trade
agreements and other arrangements
Economy
Number of
Agreements
Notified under
all
Agreements
under
Notified under GATT Art XXIV
agreements in force negotiations Enabling Clause or GATS Art V
Not
notified
Armenia
(2003)*
10
9
1
0
8
2
Azerbaijan
10
10
0
1
3
6
Kazakhstan
13
11
2
1
6
5
Kyrgyzstan
(1998)*
(1998)
11
11
0
1
8
2
Tajikistan
9
9
0
1
3
5
Turkmenistan
7
7
0
1
4
2
Uzbekistan
11
10
1
1
3
7
Note: * = WTO members
Assistance within SPECA
Assistance within SPECA • For the LLDCs in Central Asia, the SPECA Project Working Group
on Transport and Border-Crossing (PWG-TBC) has been
providing
idi
valuable
l bl
supportt for
f
t
transport
t infrastructure
i f
t
t
development since its launch in 1998. To date 17 sessions of this
working group have been organized under the leadership of
Kazakhstan with the assistance of ESCAP and the Economic
Commission for Europe (ECE) Secretariats, which has emerged
as an effective
ff ti
platform
l tf
f
for
cooperation
ti
among the
th countries.
ti
These
intergovernmental
agreements
and
cooperation
y institutional p
platform for
mechanisms have created the necessary
a coordinated and rationale planning of regional infrastructures.
• 18th session of the PWG-TBC
PWG TBC is planned to be held on 4-5
4 5 April in
Almaty, Kazakhsta.
Trade and transit facilitation
National
 Simplify behind-the-border import and export procedures
(e.g. single window)
 Participate actively in the negotiations of regional transit
Hi h trade
High
t d
agreements
t
costs,
 Accede to global conventions/agreements such as WTO
cumbersome
GATT, UNECE TIR Convention, etc.
t d
trade
Regional
procedures and
 Effectively conclude and implement transit and transport
lack of
agreements
appropriate
i t
regional transit  Improve coordination & harmonization of procedures
across the borders
regimes
 Admit
Ad it vehicles
hi l liliability
bilit iinsurance among relevant
l
t
and
d
countries
 Establish regional guarantee system
 Simplify the accession procedures to international
conventions/agreements & provide technical assistance
Regional and South South Cooperation
Regional and South‐South Cooperation
• The intra-Central Asia exports/imports as a proportion of total Central Asian
exports/imports
t /i
t to
t the
th world
ld have
h
b
been
rather
th
l
low
- att 4.7%
4 7% and
d 5.6%
5 6%
respectively in 2010.
• Regional integration is a complex process much influenced by the
particularities of the each individual country, hard to approach by universal
rules or political scenario. By exchanging the Asian development
experiences and South-South
South South cooperation,
cooperation it is possible to speed up the
process of socio-economic growth and integrate South-South cooperation in
the region.
• Afghanistan, being a landlocked country, needs access to regional and
international markets for development. The increased stability has opened
new opportunities
pp
for the country
y to become a land bridge
g connecting
g
Central and South Asia. ENCA implements a project on strengthened
economic ties, reduced trade and transport barriers, increased joint
activities between entrepreneurs
p
of Afghanistan,
g
, Central Asia and Russia
resulted in increased trade, local production and employment.
Potential for Intra
Intra-Central
Central Asia and
Central-South Asia Trade Integration
X to→/ M from↓
YEAR
Central Asia's Exports to Central Asia
Central Asia
Asia's
s Exports to South Asia
South Asia's Exports to Central Asia
VALUE (US$ BN)
% CHANGE OVER 2010
2020
2025
2030
2020
2025
2030
CENTRAL ASIA -CENTRAL ASIA
26
41
63
2470
4029
6161
CENTRAL ASIA -SOUTH ASIA
6
9
12
545
787
1060
7
11
17
2032
3423
5221
CENTRAL ASIA -CENTRAL ASIA and CENTRAL ASIA SOUTH ASIA
39
61
91
5147
8338
12542
Central
C
t lA
Asia's
i ' Trade
T d with
ith Central
C t l and
d South
S th Asia
A i
Combined
Notes:
Central Asia Export to Central Asia 2010 Billion $
Central Asia Exports to South Asia 2010 Billion $
South Asia's Exports to Central Asia 2010 Billion $
Central Asia's Trade with Central and South Asia Combined 2010 Billion $
2.35
0.94
0.32
3.61
Looking Forward
g
• There are significant barriers to trade and investment integration in Central
Asia related to trade policy, connectivity, infrastructure etc.
a) Market access:
• Trade-related Barriers: The more significant
g
trade barriers p
pertaining
g to trade p
policy
y
in the CARs include a complex tariff schedule and relatively high tariffs; escalation of
tariffs; frequent and unpredictable changes in the tariff schedule; high implicit tariffs in
the form of taxes that are levied on imported goods.
goods
• Trade Facilitation and Procedural Bottlenecks: Trade facilitating customs
procedures and rules are at differing levels of evolution in the CARs and they lack
harmonization across countries, acting as a major bottleneck for intra- and extraregional trade linkages. These not only include customs valuation and definitional
procedural delays,
y complex
p
documentation and inefficient clearances.
issues but also p
• Accession to WTO: A lack of WTO membership for the four non-member LLDC
states, except Kyrgyzstan, Armenia and Tajikistan is a big constraint on trade flows as
WTO-consistency in various rules makes trade regimes more harmonized and
streamlined.
Looking Forward (con’t)
Looking Forward (con
t)
a) Connectivity:
Oth significant
Other
i ifi
t barriers
b i
t trade
to
t d in
i Central
C t l Asia
A i are high
hi h transport
t
t costs
t and
d long
l
and unpredictable transport times for international shipments to and from the CARs.
This is not only because of the landlocked and remote location of the CARs and their
difficult topography, but also due to deficiencies of their transport networks, high
costs and low quality of transport and logistics services in the region, and difficulties
with movements of goods and transport equipment across borders and through the
territories of the CARs and neighboring countries.
a)) Productive
P d ti capacity
it development:
d
l
t
The NCA LLDCs could be divided into three groups.
Group 1. Energy exporters (Kazakhstan, Azerbaijan, and Turkmenistan) Group 2.
Armenia, Kyrgyzstan and Tajikistan are financed, to a considerable extent, by
remittances from labor migrants and with the support of diasporas.
Group 3. Uzbekistan has a diversified structure of exports and a considerable share
off products with a relatively high level off processing, while they still have
considerable raw materials exports.
Intergovernmental Agreement on the
Asian Highway Network
Participant
Signature
Definitive signature(s), Ratification,
A
Acceptance(A),
t
(A) A
Approval(AA),
l(AA)
Accession(a)
Armenia
26 Apr
p 2004
6 Jun 2005
Azerbaijan
28 Apr 2004
5 May 2005
Georgia
26 Apr 2004
9 Dec 2005 AA
Kazakhstan
26 Apr 2004
1 Nov 2007 AA
Kyrgyzstan
26 Apr 2004
30 Aug 2006
Russian Federation
Tajikistan
Uzbekistan
27 Apr 2004 s
26 Apr 2004
9 Apr 2006
26 Apr 2004 s
Intergovernmental Agreement on the
Trans-Asian Railway Network
Approval(AA), Acceptance(A),
Accession(a) Ratification
Accession(a),
Participant
Signature
Armenia
10 Nov 2006
Azerbaijan
j
10 Nov 2006
Georgia
18 Dec 2007
Kazakhstan
10 Nov 2006
Russian Federation
10 Nov 2006
4 Jan 2008 A
Tajikistan
10 Nov 2006
19 Feb 2008 AA
Uzbekistan
10 Nov 2006
28 Jul 2009
13 May 2009 AA
Th k You
Thank
Y