Seasonal Unit Roots and Structural Breaks in agricultural time series: Monthly exports and domestic supply in Argentina

Monthly time-series data based on agricultural commodities tend to present strong and particular patterns of seasonality. The presence of zero values in some of the seasons is not explained by the absence of reporting but is the result of actual features of agricultural processes. Seasonal unit root tests have never been applied to data that exhibit these characteristics, with a consequent lack of critical values to be used in the inference. Monte Carlo simulations are performed to obtain critical values that can be used for this type of data. In addition, seasonal unit roots under the presence of unknown structural breaks have never been applied to any kind of monthly time series, with the associated absence of critical values to be used in the testing procedure. Monte Carlo simulations are also performed to tabulate these critical values. It is observed that the presence of zero values does not invalidate the critical values available, with or without unknown structural breaks; the values obtained here for the monthly seasonal unit root tests under unknown structural breaks can be used in any other kinds of exercise. A seasonal unit root test with more power is also considered and critical values are obtained to perform the inference. The capability of the seasonal unit root tests to select the right break date is analysed, with some divergent results with respect to previous findings. An application of these techniques on the monthly quantities of exports and domestic supply of three agricultural commodities in Argentina between 1994 and 2008, which observe the patterns of seasonality described, is presented. Although, some evidence of stochastic seasonality has been found in some of these series, in general a deterministic approach can adequately describe their seasonalit

Shallow versus Deep Integration between Mediterranean Countries and the EU and within the Mediterranean Region

The paper aims at assessing the specific impact of shallow versus deep integration between Mediterranean (MED) countries1 and their partners in the European Union (EU) as well as between the MED countries themselves. It relies on dataset developed for this project concerning tariffs (as a proxy for shallow integration) and Non Tariff Measures (NTMs)2 (as a proxy for deep integration). Additional data are also included in order to take into account other trade costs, especially transport costs and logistics costs. In this regard, an original dataset of maritime freight cost (Maersk, 2007) is introduced as well as the trade logistics performance (TLP) index produced by the World Bank. Such datasets are useful for providing additional insight into deep integration. The paper starts by calculating the magnitude of NTMs in terms of ad valorem tariff equivalent (AVEs). The estimation of NTMs through ad valorem equivalents (AVEs) shows that Algeria and Jordan have the highest value of AVEs, whereas Tunisia, Morocco, and Egypt have the lowest value. A gravity model is then estimated with special emphasis on trade costs which are the crucial point in our research study. Given the limitation of data on NTMs, the gravity model is estimated for only one year (2001), and for each MED country. Trade costs are represented by tariffs, AVEs of NTMs, and transport and logistics costs. The idea is to test which of the three elements of trade costs are the most impeding to bilateral trade between MED countries and EU countries as well as amongst MED countries. The model shows that tariffs, NTMs, and trade and logistics costs have a significant impact on trade, but is highly vivid in countries suffering from high tariff rates, prevalence of NTMs, and trade costs. A number of simulations are carried out trying to differentiate between the impact of partial liberalization and full liberalization on trade creation. The results obtained show that full liberalization has a significant effect whether it is only related to shallow integration (tariff removal) or deep integration (NTMs and trade and logistics). The effect is higher if trade costs and logistics are improved. The results are far less if only partial liberalization takes place and in several countries is insignificant implying that marginal reductions in NTMs or tariffs cannot always help to create trade. Finally the study shows that there is a huge potential for enhancing trade amongst MED countries if trade costs are lowered, logistics is improved, and NTMs are abolished.Regional Trade Agreements, Regional Integration, Non-Tariff-Measures, Deep versus shallow integration, South Mediterranean countries, European Union Trade Agreements

The phase-out of second-hand clothing imports: what impact for Tanzania?

The East African Community has begun phasing-out imports of second-hand clothing to promote the development of the domestic garment sector. Using trade data and information obtained from the exporters, this study produces the first estimate of disaggregated imports of second-hand clothing in Tanzania. The net import of used clothing is estimated at over 540 million pieces per year, compared to a domestic production of new clothing of 20 million pieces and import of 177 million pieces of new clothing. This study assesses the short-term impact of the phase-out on the domestic garment sector. Depending on the substitutability between new and used clothing, the phase-out could prompt increased import of new clothing. It could also prompt employment losses and generate costs for the poorest consumers. In the longer term, the phase-out is unlikely to promote the development of the garment sector unless the existing constraints are properly addressed

The phase-out of second-hand clothing imports: what impact for Tanzania?

The East African Community has begun phasing-out imports of second-hand clothing to promote the development of the domestic garment sector. Using trade data and information obtained from the exporters, this study produces the first estimate of disaggregated imports of second-hand clothing in Tanzania. The net import of used clothing is estimated at over 540 million pieces per year, compared to a domestic production of new clothing of 20 million pieces and import of 177 million pieces of new clothing. This study assesses the short-term impact of the phase-out on the domestic garment sector. Depending on the substitutability between new and used clothing, the phase-out could prompt increased import of new clothing. It could also prompt employment losses and generate costs for the poorest consumers. In the longer term, the phase-out is unlikely to promote the development of the garment sector unless the existing constraints are properly addressed

TRIPS and Special & Differential Treatment – Revisiting the Case for Derogations in Applying Patent Protection for Pharmaceuticals in Developing Count

In this paper we apply an implicit threshold approach, malleable to the principle of graduation, to identify countries that should benefit from derogations from WTO TRIPS commitments for pharmaceutical patents under the tenets of Special and Differential Treatment. This is based on the identification of four broad constraints loosely classified as; economic constraints; access topharmaceuticals; capacity constraints; and incidence of health outcomes. We identify these by means of analytical criteria and create a composite index that ranks countries according to the observed constraints which delimit the capabilities and desirability of implementing TRIPs disciplines. We discuss the use of negotiated weights and thresholds in determining participation and graduation into general provisions of the agreement. It follows that countries below the chosen threshold should be exempt from these hence receiving Special and Differential Treatment

Potential effects of the proposed transatlantic trade and investment partnership on selected developing countries

On 13 February 2013, the President of the United States, the President of the European Commission and the President of the European Council jointly announced that the EU and the US had agreed to launch negotiations on a Transatlantic Trade and Investment Partnership (TTIP). According to the final report of the High Level Working Group on Jobs and Growth (HLWG), the TTIP will aim at the: - elimination or reduction of conventional barriers to trade in goods, such as tariffs and tariff-rate quotas - elimination, reduction, or prevention of barriers to trade in goods, services, and investment - enhanced compatibility of regulations and standards elimination, reduction, or prevention of unnecessary “behind the border” NTBs to trade in all categories - enhanced cooperation for the development of rules and principles on global issues of common concern and also for the achievement of shared global economic goals This paper evaluates some of the potential effects of EU-US TTIP economic integration on the trade in goods of 43 low-income countries (LIC). It first assesses the impact of removing the most-favoured nation (MFN) tariffs that apply to trade between the EU and the US. It then examines the impact of regulatory integration on sanitary and phytosanitary (SPS) measures and technical barriers to trade (TBT) on LIC

African greenfield investment and the likely effect of the African Continental Free Trade Area

Using sector-level data on bilateral greenfield investment for 198 source and destination countries over 2003-2018 in a structural gravity model, we examine the likely effect of the African Continental Free Trade Area (AfCFTA) on African investment. Conditional general equilibrium estimates from counterfactual analysis show that the stock of intra-African greenfield investment in 2018 would have increased by 14 percent from a successful implementation of the AfCFTA in that year relative to the baseline scenario of no agreement. Exploring possible transmission channels for the investment- enhancing effect of the AfCFTA, we find the intra-African trade elasticity of greenfield investment to be positive, including for intermediates, especially in host countries with strong governance indicators. However, the effect of regulatory cooperation via bilateral investment treaties is found to be negative. This suggests that trade liberalization under the AfCFTA is more likely to foster intra-African investment via its positive effect on intra-African trade

One-stop border posts in East Africa: Impact on transport costs and issues for further analysis

Trade is essential for economic growth and development in East Africa. However, trade has been hampered by various challenges, including long wait times for customs clearance and duplication of procedures. To address these challenges, the use of One-Stop Border Posts (OSBPs) has been implemented in East Africa. This report assesses the impact of OSBPs on transport times and operational costs in the region, with a focus on the impact of OSBPs supported by TradeMark Africa (TMA). The report's findings show that the use of OSBPs has led to significant reductions in transport costs and the total dwelling time for transport companies, with reductions ranging from 62% to 87%. The reduction in dwelling times owes to significant cuts in the time it takes for customs procedures, leading to a reduction in queuing times. The impact is more significant for borders that had long crossing times to start with, with Holili (Kenya-Tanzania) and Mutukula (Uganda-Tanzania) experiencing a reduction larger than a full driver-day equivalent. The report also found that the reductions in dwelling times have been greater at the border posts located in Uganda and Tanzania, with reductions being lower at border posts located in Kenya. The consequent reduction in operational transport costs is higher for traffic entering Uganda and Tanzania, leading to a substantial fall in operational costs for transporters on key routes such as Nairobi-Kampala, Mombasa-Mwanza, and Dar es Salaam-Kampala. The report's estimates can be used as a starting point for a fuller impact assessment in subsequent analysis

One-stop border posts (OSBPs): An assessment of the economic and social impact

Trade is an essential driver of economic growth and development. However, the high cost of trade has remained a significant barrier to the success of cross-border trade in many regions across the world. One-stop border posts (OSBPs) have been introduced in various regions, including East Africa, to reduce the cost of trade and facilitate trade flows. But what is the impact of OSBPs on the economy and the livelihoods of households in the region? This report provides insights into the impact of OSBPs on the economy and households in East Africa. It assesses how reduced trade costs resulting from the introduction of OSBPs have been transmitted to the rest of the economy, particularly how this has affected consumer prices and household expenditure. To assess the impact of OSBPs, the study analysed the Busia (Kenya-Uganda) and Taveta-Holili (Kenya-Tanzania) OSBPs. The study selected two products - maize and rice - based on two criteria: the products had to be widely consumed by households in the region, and they had to be regularly traded among the countries of the East African Community (EAC) and across OSBPs. The report found that OSBPs have had a positive impact on reducing consumer prices, increasing household income, and stimulating economic growth in the region. OSBPs have the potential to enhance cross-border trade and investment in the region, making it easier for traders to conduct business across borders, and reducing the cost of trade for businesses and households

Trade in services and economic transformation

This paper examines the role of trade in services by discussing how the trade aspects of services help promote economic transformation. A sceptical view often exists that services follow rather than lead transformation. However, we argue it is important for economies to follow a balanced growth path because of the explicit and implicit linkages between the various sectors. We suggest policy-makers need to update their evidence base on the linkages between sectors and consider more carefully what specific actions deserve priority. Even when promoting manufacturing exports is the top priority, the answer can actually be found in trade in services policy. This paper provides information on how such linkages might work, updating the evidence base. The paper addresses two main questions: What is the role of trade in services in economic transformation and what can be done to improve the contribution? It tackles these using mixed methods. We review what we know about the relationships between trade in services and economic development and identify areas in need for further research (Section 2). The statistical analyses at micro and macro levels in Sections 3 and 4 provide new insights by quantifying how these relationships work, directly through trade in services or indirectly, by services production being embodied in goods trade. Section 5 selects five services sectors and undertakes brief case studies. It focuses on how the trade aspect matters for transformation and on how selected countries have promoted more exports of services, distinguishing between trade policy and other factors. In exploring whether and how trade in services and other policy can have a major impact in raising the contribution of services for economic transformation, we summarise the main findings into three categories: 1) improved knowledge