Spotlight: Trade Corridors for Landlocked Developing Countries
of 44 landlocked countries are classified as developing.
of trade belongs to landlocked developing countries.
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“LLDCs are marginalized in global trade. Their share of merchandise trade decreased from 1.2% in 2014 to 0.98% in 2021, and they continue to face excessive trade costs.”
H.E. Rabab Fatima, Under-Secretary-General and High Representative for LDCs, LLDCs and SIDS; Secretary General, Third United Nations Conference for LLDCs, United Nations
“We spend 6.2% of our entire GDP on transportation of goods from our capital to the nearest seaport. Then from that port, you still have to pay the sea transport and be competitive at the third country market. It’s very difficult.”
Odbayar Erdenetsogt, Foreign Policy Advisor to the President of Mongolia
their average distance from the nearest seaport.
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They are dependent on their neighbours to reach these ports, rely on their infrastructure and go through their administrative processes to transport their imports and exports.
“Hard infrastructure must be supported by appropriate international and domestic legal environments which together will facilitate trade.”
H.E. Battsetseg Batmunkh, Minister of Foreign Affairs, Mongolia
Priorities: trade corridor reforms, regional trade connectivity
LLDCs must rely on their regional neighbours. By aligning trade agreements, policies, regulations and procedures, they can lower costs, speed up border crossings and get better access to markets. Trade for landlocked countries relies on regional infrastructure. They should focus on transport and logistics sectors as well as climate resilience.
Partnerships should include governments, businesses, development partners and international organizations.
“The customs-free trade corridor between Kazakhstan and Uzbekistan has greatly increased the flow of goods and reduced the cost of trade between the two countries.”
Holger Wiefel, Regional Head, Central Asia & Mongolia, SME Finance & Development, European Bank for Reconstruction and Development
“Our strategy is to develop (Lao PDR) from landlocked land-linked… In recognizing the need to reduce transportation and trade costs, the country sees trade facilitation as an important element of our policy to help the private sector. Efforts are made to introduce automated information systems for customs clearance, adoption of ASYCUDA system along with more modern risk management techniques. We also institutionalize public-private partnership to discuss how to improve business environment in the country.”
H.E. Bountheung Douangsavanh, Vice Minister of Industry and Commerce, Lao PDR
Improve cross-border operations
Inefficient borders slow the passage of goods and incur costs. Integrated border management and joint customs control reduces duplicate inspections.
“We must promote paperless border procedures, leveraging ICT to reduce costs and increase efficiency.”
Irene Tembo, Chief Planner, Ministry of Transport and Logistics, Zambia
Digitize
Artificial intelligence and new technologies can help streamline border crossings, reduce waste and carbon impact and shrink costs. Early investment will put landlocked countries on a more competitive footing and expand market reach.
“We must improve the digital trade infrastructure for LLDCs. This includes cargo trade infrastructure, single-window portals for customs and paperwork, trade hubs and development of smart overseas warehouses.”
Dorothea Lazaro, Regional Cooperation Specialist, Asian Development Bank
“Go digital, cut traffic, reduce pollution. Digital, paperless procedures make trade faster, cheaper, and safer… Paperless trade has the potential to lower transaction costs by 10-30%, and significantly reduce carbon dioxide emissions.”
International Trade Centre, Transform Your Economies with Connected Services, Closeup on Landlocked Countries, 2023
Make trade facilitation inclusive
Focus on small firms, women in trade, indigenous communities and youth to facilitate inclusive trade. Access to financing, training and mentorship programs, policy reform and public-private dialogue contributes to inclusive growth and poverty reduction.
“When designing inclusive reforms, we need data, people and strong leadership who understand specific gender constraints. We need women’s business associations to be part of national and regional participation committees, so that women-owned business can speak with one voice.”
Alina Fetisova, Trade Facilitation Officer, International Trade Centre
Mobilize resources collectively
Use dedicated public-private sector partnerships and champion regional trade initiatives. Committees that share knowledge and resources can help consolidate funding and planning for resources.
“At present, interest rates are too high. There are government initiatives which have been deployed to subsidize lending rates, but those are unfortunately not reaching all, and in particular, not reaching SMEs.”
Holger Wiefel, Regional Head, Central Asia & Mongolia, SME Finance & Development, European Bank for Reconstruction and Development
“Private sector consultations foster partnerships between governments, development partners and businesses… They can leverage additional resources and expertise through active engagement in the development process.”
Dulguun Damdin-Od, Executive Director, International Think Tank for Landlocked Developing Countries
Full session recording
LLDC Consultation Inauguration
Full session recording
LLDC Consultation Outcomes
Full session recording
LLDC Consultation Keynote Adress
Full session recording
Regional Trade Connectivity for LLDCs (panel discussion)
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