GLOBAL: Reducing supply chain barriers could boost trade
A report released by the World Economic Forum has found that reducing supply chain barriers to trade could increase global GDP and exports by a greater amount than would be achieved by cutting import tariffs.
The researchers have calculated that reducing supply chain barriers could increase GDP by nearly 5% and trade by 15%.
It said that simply by improving border administration, transport and communications infrastructure, global GDP could increase by US$2.6trn, and exports by $1.6trn.
By comparison, eliminating tariffs could increase global GDP by US$0.4trn and exports by $1.1trn.
The report calls on governments to work with businesses and analysts to look at ways of collecting data on factors that affect supply chain operations. This can then be used to identify policy clusters that determine key supply chain barriers and identify priorities for action.
It also suggests creating a high-level body that has a mandate to coordinate and oversee all regulation that directly affects supply chain efficiency and ensure that SME interests are represented.
And it seeks a more holistic approach to international trade negotiations including services such as transport and distribution, as well as areas like border protection and management, product health and safety, foreign investment, and the movement of business people and service providers.
It also suggests a global effort should pursue conversion of manual and paper based documentation to electronic systems, using globally agreed data formats.
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