Trade Facilitation - CreativeBox

African Business Roundtable

ABR HANDBOOK ON BUSINESS

FACILITATION

2014

Conformity Standards Technology Access to Markets

Contents Introduction African Business Round Table ......................................................................................................... 1 CONFORMITY STANDARDS .................................................................................................................................. 5 Section 1: Conformity Standards and Trade for Development ........................................................................ 6 What is a standard? ........................................................................................................................................ 9 Popular standards ....................................................................................................................................... 9 Attributes of a Standard ................................................................................................................................. 9 African Regional Organization for Standardization ...................................................................................... 10 National Standards Bodies ............................................................................................................................ 10 Standards as Means for Competitiveness .................................................................................................... 11 Benefits of International Standards ............................................................................................................. 12 Benefits of Standardization .......................................................................................................................... 12 Standards as Tool for Trade .......................................................................................................................... 13 For Business ............................................................................................................................................... 13 For Society ................................................................................................................................................. 14 For Government ........................................................................................................................................ 14 Principles of Effective Application of Standards .......................................................................................... 15 TECHNOLOGY AND DEVELOPMENT ................................................................................................................... 16 Section 2: Technology and Development ...................................................................................................... 17 Technology as an Instrument for Development ........................................................................................... 18 Meeting entrepreneurial needs ................................................................................................................ 18 Example of Best Practices ............................................................................................................................. 19 Box 4: Business Links, Investment and Banking ....................................................................................... 19 Box 5: Kenya’s Mobile Revolution ............................................................................................................ 20 ACCESS TO MARKET ........................................................................................................................................... 22 Section 3: Market Access ............................................................................................................................... 23 Messages on Market Access ......................................................................................................................... 24 Challenges Micro-‐entrepreneurs face in Growing Their Enterprises ........................................................... 24 Table 1: KNOWLEDGE OF THE INDUSTRY ................................................................................................. 25 Strategic Market Access Plans ...................................................................................................................... 26 Market Planning Cycle .................................................................................................................................. 27 Stage 1. Assessment of Opportunities ...................................................................................................... 27

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Stage 2: Strategies ..................................................................................................................................... 28 Stage 3: Implementation ........................................................................................................................... 29 Stage 4: Measure ....................................................................................................................................... 29 Closing the Plan ............................................................................................................................................. 30 Strategic Tips for Market Access Plans ......................................................................................................... 31 Current Issues that Face Market Access in the Region ................................................................................ 32 Market Access Mapping ................................................................................................................................ 33 Patterns of Protection ................................................................................................................................... 34 Contingent Protection ................................................................................................................................... 37 Policy Implications ........................................................................................................................................ 39 Opportunities for Engagement with Global Market .................................................................................... 41 Trade Preferences ......................................................................................................................................... 41 Standards and Non-‐Tariff Barriers to Trade ................................................................................................. 43 Specific Product market ................................................................................................................................ 45 Subsidies and Their Impact ........................................................................................................................... 45 Trade Facilitation ........................................................................................................................................... 46 Technology and Trade ................................................................................................................................... 48 Impact ............................................................................................................................................................ 49 Other Aspects Related to Trade and Technology ......................................................................................... 49 USING MEDIA AND INFORMATION TECHNOLOGY ............................................................................................. 51 Section 4: Using Media and Information Technology ................................................................................... 52 Engaging Media for Advocacy ....................................................................................................................... 53 Massages ....................................................................................................................................................... 54 Follow-‐up and Maintaining Contacts ............................................................................................................ 54 Telling the Case Stories ................................................................................................................................. 54 Pragmatism ................................................................................................................................................... 54 Targeted Advocacy ........................................................................................................................................ 54 Creative Presentations .................................................................................................................................. 54 Press Releases and Kits ................................................................................................................................. 55 Harnessing Regional and International Conferences ................................................................................... 55 Training on Advocacy .................................................................................................................................... 56

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Digital Progress and Changing Dynamics ...................................................................................................... 56 TOOLS AND SELF-‐AWARENESS RESOURCES ....................................................................................................... 57 Section 5: Tools and Self-‐Awareness Resources ............................................................................................ 58 ABR Mission ................................................................................................................................................... 58 ABR Core Values ............................................................................................................................................ 59 ABR Messages on Business ........................................................................................................................... 59 Box 15: ABR and Youth Entrepreneurship Program ................................................................................. 60 Elements of Market Planning ........................................................................................................................ 60 Awareness Creation on ABR Communication Strategy ................................................................................ 60 Using ABR Partner Map ................................................................................................................................. 61 Map of Partners used for strategic planning to expand market .................................................................. 62 Determination of how ABR is perceived among the Partners ..................................................................... 63 ABR Quantitative and Qualitative Data ........................................................................................................ 63 Description of ABR in quantitative terms .................................................................................................. 63 Description of ABR in qualitative terms ..................................................................................................... 63 Quantitative and Qualitative data used to promote Market Access ......................................................... 64 Crafting Effective ABR Business Messages ................................................................................................... 64 ABR Reports as Marketing Instrument ......................................................................................................... 64 Monitoring and Evaluation ................................................................................................................................ 65 Section 6: Monitoring and Evaluation ............................................................................................................ 66 Mechanism for ABR M&E .............................................................................................................................. 66 Monitoring ..................................................................................................................................................... 67 Evaluation ...................................................................................................................................................... 67 Conclusion .......................................................................................................................................................... 70 Conformity Standards ................................................................................................................................... 71 Technology .................................................................................................................................................... 71 Market Access ............................................................................................................................................... 71 Reference .......................................................................................................................................................... 72

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Acronyms

ABR

African Business Roundtable

ACBF

African Capacity Building Foundation

ACT

Awareness Creation Team

AfDB

African Development Bank

AGOA

African Growth and Opportunity Act

ARSO

African Regional Organization for Standardization

ASME

American Association of Mechanical Engineers

ASTM

American Association for Testing Materials

ATM

Access to Market

AVE

Valorem Tariff Equivalent

BUSA

Business Unity South Africa

CAB

Conformity Association Bodies

CASCO

Conformity Assessment Standards

CEAC

Chinese European Arbitration Centre

CEO

Chief Executive Officer

COMESA

Common Market for Eastern and Southern Africa

COPOLCO

Committee on Consumer Policy

DVD

Digital Versatile/Video Display

ECOWAS

Economic Commission of West African States

EU

European Union

FCT

Federal Capital Territory

FDI

Foreign Direct Investment

GATT

General Agreement on Tariffs and Trade

GSP

General System of Preferences

HR

Human Resources

IEC

International Electro-‐technical Commission

IGAD

Inter-‐governmental Authority for Development

IPA

Investment Promotion Agency

ISO

International Standardization Organization

ITC

International Trade Commission

LDC

Least Developed Countries

M&E

Monitoring and Evaluation

NBS

National Bureau of Standards

NEPAD

New Partnership for Africa's Development

NGO

Non-‐Governmental Organization

NTM

Non-‐Tariff Measures

OECD

Overseas Economic Cooperation and development

SADC

South Africa Development Community

SAE

Society of Automotive Engineers

SAGE

Students for the Advancement of Global Entrepreneurship

SME

Small Medium Enterprise

SPS

Sanitary and Phytosanitary

TBT

Technical barrier to Trade

TRQ

Tariff Rate Quotas

UNECA

United Nations Economic Commission for Africa

UNECOSOC United Nations Economic and Social Council WEF

World Economic Forum

WTO

World Trade Organization

Foreword This Handbook is developed to serve the members on ABR, business partners, private sector and public entities can benefit from all or part of the content of the Handbook. It provides basic understanding of how best conformity to standards, technology and accesses to market can be harnessed. The thrust of the Handbook is that ABR takes the lead role in creation and carrying out initiatives for their own solutions. The solutions are then shared in advancing the regional capacity to achieve higher productivity. ARB, through advocacy takes on as many different forms of emerging solutions, which are packaged for learning and information, exchange. The Handbook helps to provide different facet of standards, technology and market access that would improve the way things can be done better. It takes into account the differences in the trade the members may be involved in, the national and regional diversities and offering examples of applications of standards, technologies and market access in different situations. The use of the Handbook aims to spark the members’ creativity, empower them to innovate and propel their solutions for achieving high productivity and profitability in their venture. It navigates the reader through understanding conformity standards, harnessing technology for development and providing insights on capturing market share at all levels. The issue of advocacy is stressed and the use of media for expanding market outreach and information sharing is emphasized. Tools to help members are highlighted in as handbook as way to provide easy reference to resources for market access and outreach.

ABR HANDBOOK ON BUSINESS FACILITATION Conformity Standards, Technology, Access to Markets

Introduction African Business Round Table

Background African Business Roundtable is an NGO in special consultative status with the Economic and Social Council of the United Nations, promoting private sector development in Africa.

Vision Statement To become the globally preferred partner for facilitating the sustainable development of Africa’s private sector.

Mission Statement To promote, via various initiatives throughout the continent and beyond, the development of Africa’s private sector, particularly small medium enterprises (SME’s), ensuring they grow and become dynamic, globally competitive and sustainable.

Key Objectives § §

§ §

To expand the role of private enterprise in Africa and to create an environment conducive to economic growth and prosperity To provide assistance to existing enterprises and to serve as a forum for business leaders to study issues, exchange ideas and develop positions and solutions to problems of mutual concern To serve as a forum for its members, promote the establishment of business relations among them and encourage the formation of joint ventures To promote wider awareness of Africa’s business, investment and trade potential

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§

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To advise and encourage governments and other national, regional or international institutions, to adopt laws, policies, regulations and procedures that enhance business growth, especially in SMEs. To co-‐operate with governments, the public sector and other organisations in Africa and internationally with a view to advocating elimination of impediments to investment and trade

To build and maintain a positive image and to enhance the good reputation and effectiveness of African entrepreneurs by providing them with: § § § § § §

Training and professional opportunities (including expert research and appropriate technology). Advice on potential sources of capital and assistance in resource mobilisation. Encouraging indigenous African enterprise in the processing and marketing of raw materials and agriculture products and in the various service sectors. Promoting amicable settlement of business disputes through mediation and arbitration Serving as an instrument for healthy dialogue with governments and the public sector. Enhancing co-‐operation with African regional and sub-‐regional financial or economic organisations for the integration of the economies of Africa and assist businessmen and business women to play a constructive role in building a more prosperous Africa.

ABR Strategy and Awareness ABR is dedicated to achieving an African private sector led regional economic integration and sustainable economic development of Africa. It is based on good corporate governance and competitively open market systems. ABR focuses on sustained awareness creation on the need to strengthening the African private sector, promoting intra-‐African trade and investment, and attracting foreign investment into Africa to transform the continent from ‘aid-‐receiving’ to private sector partnerships in economic development.

ABR Business Services and Offers The ABR offers members a broad range of products and services, free of charge or at a discounted rate, designed to benefit your business. These include: Business guides: Free monthly Business guides giving expert advice, opinions and experiences from top business professionals.


Business surveys: Member consultations, business surveys and access to our subscription of relevant publications that provide you with the latest economic trends and short-‐term prospects. Business Voice magazine / Electronic newsletter: The ABR’s Electronic newsletter including features on leading companies and business executives. Must-‐read sections from leading business writers cover business trends and current ABR policy thinking. ABR Directory: A free entry in the ABR Directory (our business listings guide), in print and on the web. Promote your company to over 2,000,000 key contacts all over the world. Economic and Business outlook: Exclusive to members, the ABR's subscription to weekly, monthly, and quarterly economic and business outlooks and other financial and trade journals and magazines, gives up-‐to-‐the-‐minute, authoritative commentary and analysis of the national, regional and Africa continental economy. Email updates: ABR has exclusive regular email bulletins delivered to your desktop to keep you in touch with issues relevant to your industry, trade and investment climate. Our range of updates cover key business sectors, e-‐business, trade opportunities, procurement opportunities, the environment, health and safety, enterprise, finance, HR and employment, infrastructure, and public services. Events: Our nationwide, regional, continental and international programme of events keeps members in touch with business developments in the Africa and abroad, and is a great way to widen your business contacts. Policy reports: Authoritative reports and briefings on a comprehensive range of business-‐critical topics will keep you up to date with the policy areas directly affecting you. These could be commissioned as the need arises but can also be available in the policy magazines to which ABR has subscribed. Sponsorship and Partnership opportunities: Contact ABR Secretariat to discover the benefits of working with ABR on events, publishing, awards and online projects. Trade, Investment Promotion, Exhibitions: This could be arranged in Africa or in overseas countries to encourage cross-‐border investment and promotion of products and services, in conjunction with IPAs. ABR Handbook on Business Facilitation| 3

Structure of the Handbook The Handbook is not just for the members on ABR. Any business partners, private sector and public entities can benefit from all or part of the content of the Handbook. The Handbook provides basic understanding of how best conformity to standards, technology and accesses to market can be harnessed. ABR promotes the principle that the business entities that are members of the roundtable take lead role in creation and carrying out their own solutions. These solutions are then shared in advancing the regional capacity to achieve higher productivity. ARB, through advocacy takes on as many different forms of emerging solutions, which are packaged for learning and information, exchange. The Handbook simply helps to provide different facet of standards, technology and market access that would improve the way things can be done better. It takes into account the differences in the trade the members may be involved in, the national and regional diversities and offering examples of applications of standards, technologies and market access in different situations. The use of the Handbook aims to spark the members’ creativity, empower them to innovate and propel their solutions for achieving high productivity and profitability in their venture. The Handbook navigates the reader through understanding conformity standards, harnessing technology for development and providing insights on capturing market share at all levels. The issue of advocacy is stressed and use of media for expanding market outreach and information sharing is emphasized. Tools to help members are highlighted in Section 5. The importance of monitoring and evaluation as a means for performance assessment and knowledge generation is on Section 6. The matrix below provides the Handbook icon topic that highlights the key messages

1 Understanding issues on standards, Technology, and Access to Markets 2 Advocacy and media 3 Tools to help the members 4 Knowledge creation through monitoring and evaluation


1

CONFORMITY STANDARDS

• • • • • • • • • •

Background What is a Standard Popular Standards Attributes of Standards African Regional Organization for Standards National Standards Standards as Means for Competitiveness Benefits of Standardization Standards as Tool for Trade Principles of Effective Application of Standards


Section 1: Conformity Standards and Trade for Development

Background The development of standardization as an engineering activity was pioneered by Eli Whitney, who in 1793 invented the cotton gin, a machine for cleaning cotton fibre. Whitney later introduced the production of interchangeable components for the manufacture of guns. Standardization of screw threads by Sir Joseph Whitworth dates back to 1841. Other instances of early standardization can be found in the dawning age of the railway industry, as the establishment of a standard width between the two rails on the railway track, the manufacture of railway couplings, air brakes and the signalling system called for increasing levels of systematized work. Mass production became possible through standardization. By the turn of the 19th century, standardization was already recognised in industrialised countries as a powerful tool to increase productivity through inter-‐changeability and reduction of variety. The early part of the 20th century saw the establishment of several standardisation bodies in the United States of America such as the National Bureau of Standards (NBS), the Society of Automotive Engineers (SAE), the American Society for Testing and Materials (ASTM), and the American Society of Mechanical Engineers (ASME), which turned standardisation into an organized and ongoing effort for industrial applications. By 1928, national standards bodies (NSBs) had been established in 16 industrialised countries. After the First World War, standardization, through reduction in variety, was established as a useful management tool for reducing costs. Some three decades later, seller market conditions, which prevailed for some time after the Second World War, put consumer interest in jeopardy. To safeguard this interest and to meet the rising demand for standards for finished products, standardization activities increased in various countries, with the additional support and involvement of government and industry. With increased trade among industrialised countries, internationally accepted norms or standards were needed to support this development. This led to the international bodies for standardization, such as the International Electro-‐technical Commission (IEC) in 1906 and the International Organization for Standardization (ISO) in 1947.


Following the colonial era in Asia and Africa and accessorily in Latin America, factors such as excess demand over supply, low purchasing power and problems with adherence to foreign standards led to the establishment of NSBs. In developing countries and in those countries that had recently gained their independence, the aim of these standards bodies were to formulate national standards to suit local technologies, materials and consumption patterns. Organised standardization has now become an important element of infrastructure needed for the healthy growth of industry and commerce in all countries of the world. The extensive range of standards and guides for conformity assessment produced jointly, under the name CASCO standards, by ISO (International Organization for Standardization) and IEC (International Electro-‐technical Commission) was outlined, together with their ability to open opportunities for developing countries to build structures acceptable to global markets. The range had recently been comprehensively modernized and extended. In developing this range of standards independently of standards for specific products or services, ISO’s goal was to The term conformity assessment (CA) includes testing and certification, but also any systematic provide a set of voluntary standards representing examination of the extent to which a product best practice in conformity assessment, reducing fulfils requirements specified by law or by the the need for regulation of that activity and market. C.A. is therefore closely linked to the ensuring that, where regulation was unavoidable, a regulations and standards against which the conformity is to be assessed. uniform basis could be used internationally. They facilitated the creation of “open” systems of Box 1: Conformity Assessment conformity assessment: systems open to all, without discriminatory entrance fees or other conditions, they contrasted with “closed” systems of c.a., in which the ground-‐rules were developed without open consultation of all interested parties, where membership might be limited to designated bodies, and which might be difficult for developing countries to penetrate. The standards were aimed not only at conformity assessment bodies (CABs), but also at accreditation bodies, which in many countries were deeply involved in the control of CABs and in the process of designating CABs as legally authorized to provide reports used by public authorities in assessing compliance with regulations. The standards had been referenced in the most recent Triennial Review of the WTO TBT Committee, and were widely used. Open standards for conformity assessment, could only contribute optimally to the elimination of barriers if their use was supported by complementary elements of technical regulation. Five elements are important:


§ § § § §

Effective product liability laws Well-‐developed market surveillance Appropriate resources and enforcement powers Penalties for false/misleading declarations Consumer redress

Separately, the state of conformity assessment barriers in international trade today was reviewed. The WTO TBT Committee had correctly identified a number of potential targets, such as the wider use of SDOC (Supplier’s Declaration of Conformity) without mandatory third party certification, and wider recognition of internationally-‐recognized accreditation in order to reduce the need for multiple testing. The issues that regional programmes in this area raise are, for example: §

§ §

How can conflicts between regional and global standards be avoided, and do regional standards development programmes hamper international standards development? Can regional standards contribute to global trade liberalization, beyond the boundaries of their region? What do regional programmes reveal about the ability of governments to recognise conformity assessment conducted outside their own country?

With a total of around 300 million consumers, SADC has made progress on achieving harmonisation in standardization and conformity assessment though this appears so far limited. However, two recent developments had the potential to bring concrete progress. First, a 2001 Memorandum of Understanding on SQAM (Standardization, quality assurance, accreditation, and metrology) aims specifically at the elimination of TBT and the establishment of a quality infrastructure; working groups had been established to drive the programme forward. Secondly, and as a result of this, a proposal to establish a regional accreditation body had been prepared. It could provide a center of expertise and a stepping-‐stone to wider international recognition of conformity assessment in the region. If supported by training and awareness building, some regional framework for technical regulation could follow. Meanwhile, it is striking that information on technical requirements in major export markets is often more easily available to exporters in the region than information on requirements from other countries within the region, so that intra-‐regional trade development is harmed.


What is a standard? A standard is a document that provides requirements specifications, guidelines or characteristics that can be used consistently to ensure that materials, products, processes and services are fit for their purpose. There are over 19 500 International Standards that can be purchased from the ISO (www.iso.org) store or from its members.

Popular standards § § § § § § § § §

ISO 9000 Quality management ISO 14000 Environmental management ISO 3166 Country codes ISO 26000 Social responsibility ISO 50001 Energy management ISO 31000 Risk management ISO 22000 Food safety management ISO 27001 Information security management ISO 20121 Sustainable events

A standard is a document which provides inter alia, requirements, rules, and guidelines, for a process, product or service. These requirements are sometimes complimented by a description of the process, products or services. It is important that: § Standards are the result of a consensus and are approved by a recognised body. § Standards are aimed at achieving the optimum degree of order in a given context. § The process of formulating, issuing and implementing standards is called standardisation.

Attributes of a Standard A standard generally has three attributes: § Level: such as at the company, national or international level. § Subject: such as engineering, food, textile or management.


§

Aspect: such as specification, testing and analysis, packaging and labelling (more than one aspect may be covered in a single standard: a standard may include specification of items such as the product, its sampling and inspection, related tests and analysis, packaging and labelling).

For example the term “Indian Standard Specification of Biscuits”, means that the standard is a national standard (level), in the food area (subject), and provides specifications (aspect) for the biscuits. Developing countries have found it difficult to participate in designing standards in ways that better reflect their concerns and capabilities, and to challenge them where they were imposed in a discriminatory manner. A number of agreements in the Uruguay Round have sought to address these concerns by strengthening international rules governing product standards in order to minimise their abuse for protectionist purposes. However, they also entail substantial costs for product redesign, assessing conformity, creating an administrative system to monitor compliance, and quality control. Many developing countries will require stepped-‐up technical and financial assistance if they are to cope with the challenges posed by proliferating standards.

African Regional Organization for Standardization The African Regional Organization for Standardization (ARSO), established in 1977, is the African intergovernmental body mandated to promote standardization activities in Africa, bearing in mind the blueprint for Africa’s economic development as outlined in the Lagos Plan of Action. ARSO has developed a comprehensive programme on standardisation and related activities in Africa. The objective of standardization by ARSO is to elaborate and harmonise regional standards in order to remove the technical barriers that hinder intra-‐African trade. Twenty-‐four African countries are members of ARSO including, inter alia, Egypt, Ghana, Kenya, Liberia, the Libyan Arab Jamahiriya, Malawi, Mauritius, Niger, Nigeria, Senegal, Sudan, United Republic of Tanzania, Tunisia, Uganda and Zambia.

National Standards Bodies At the national level, the work of preparing and issuing standards is carried out by NSBs. In some countries, NSBs are called “institutions” or “institutes” (e.g. Sri Lanka Standards Institution, British Standards Institute) and in others “associations” (e.g. Standards Association


of Zimbabwe) or “bureaus” (Bureau of Indian Standards). In some countries a department or an agency of the government is responsible for this work. Most of the NSBs around the world are members of the ISO. In some countries that do not have NSBs, provisions exist for a correspondent membership status with the ISO. At present, 148 countries are members of the ISO. Fifteen NSBs were established between 1917 and 1925, mostly in developed countries. Germany was the first to establish an NSB, followed, inter alia, by the United Kingdom of Great Britain and Northern Ireland, the United States, Belgium, Canada, Netherlands, Switzerland and Austria. In developing countries, NSBs were launched first in Brazil (1940), then, inter alia, in India (1947), the Philippines (1947), Pakistan (1951), Myanmar (1956), Iran (1960) and Sri Lanka (1964). Currently, 60 per cent of the members of ISO are developing countries. The main functions of NSBs include: § Preparation and promulgation of national standards § Promotion of the implementation of standards by industry § Certification of products § Provision of information on standards and related technical matters, with regard to both national and international standards § Country representation in international activities and at forums that deal with standards.

Standards as Means for Competitiveness Today, more and more companies in developing countries and emerging economies are becoming global producers. The liberalisation of consumer markets provides these companies with opportunities for exporting their products to global markets where they are increasingly required to comply with ‘private standards’, a phenomenon on the rise. Also known as (business) values, norms, ethics, codes, practices, guidelines, principles or morals, private standards are considered to be one way of promoting social development and environmental sustainability.


Benefits of International Standards The international standards of ISO contribute to benefiting consumers, businesses, governments and society at large in the following ways: § For consumers: conformity of products and services with international standards provides assurance to consumers on the quality, safety and reliability of these products and services. § For businesses: by adopting international standards, suppliers can conduct the development of their products and services on the basis of specifications that have wide acceptance in their sector. This in turn means that businesses that use international standards are increasingly free to compete in many more markets around the world. The application of international standards facilitates contracting and ordering of goods and services and the assessment of their quality. It also reduces disputes over specifications and quality. § For governments: international standards provide the technological and scientific bases that underpin health, safety and environmental legislations. § For everyone: international standards can contribute to quality of life in general by ensuring that the transport modes, machinery and tools we use are safe. § For the planet: international standards on air, water, and soil quality, and on emission of gases and radiation, can contribute to efforts to preserve the environment.

Benefits of Standardization By its very definition, standardization is aimed at achieving maximum overall economy. Standards provide benefits to different sectors of society. Some of the benefits of standardization are as follows: For manufacturers, standards: § Rationalise the manufacturing process. § Eliminate or reduce wasteful material or labour. § Reduce inventories of both raw material and finished products. § Reduce the cost of manufacture. ABR Handbook on Business Facilitation| 12

For customers, standards: § Assure the quality of goods purchased and services received. § Provide better value for money. § Are convenient for settling disputes, if any, with suppliers. For traders, standards: § Provide a workable basis for acceptance or rejection of goods or consequential disputes, if any. § Minimise delays, correspondence, etc., resulting from inaccurate or incomplete specification of materials or products. For technologists, standards: § Provide starting points for research and development for further improvement of goods and services. Standards as Tool for Trade International Standards ensure that products and services are safe, reliable and of good quality. For business, they are strategic tools that reduce costs by minimizing waste and errors, and increasing productivity. They help companies to access new markets, level the playing field for developing countries and facilitate free and fair global trade. International Standards bring technological,

Facts and figures about the benefits of standards ISO has developed a comprehensive set of case studies and materials describing the economic and social benefits of standards. They also have an extensive collection of case studies and resources from other partner organizations (visit www.iso.org). Box 2: Facts and Figure

economic and societal benefits. They help to harmonize technical specifications of products and services making industry more efficient and breaking down barriers to international trade. Conformity to International Standards helps reassure consumers that products are safe, efficient and good for the environment. For Business International Standards are strategic tools and guidelines to help companies tackle some of the most demanding challenges of modern business. They ensure that business operations are as efficient as possible, increase productivity and help companies to access new markets. ABR Handbook on Business Facilitation| 13

Benefits include: § § § § §

Cost savings -‐ International Standards help optimise operations and therefore improve the bottom line Enhanced customer satisfaction -‐ International Standards help improve quality, enhance customer satisfaction and increase sales Access to new markets -‐ International Standards help prevent trade barriers and open up global markets Increased market share -‐ International Standards help increase productivity and competitive advantage Environmental benefits -‐ International Standards help reduce negative impacts on the environment

Businesses also benefit from taking part in the standard development process. For Society There are over 19,500 standards touching almost all aspects of daily life. When products and services conform to International Standards, consumers can have confidence that they are safe, reliable and of good quality. For example, ISO's standards on road safety, toy safety and secure medical packaging are just a selection of those that help make the world a safer place. To make sure that the benefits of ISO International Standards are as broad as possible, ISO supports the involvement of consumers in standard development work with its Committee on consumer policy (COPOLCO). International Standards on air, water and soil quality, on emissions of gases and radiation and environmental aspects of products contribute to efforts to preserve the environment and the health of citizens. For Government ISO standards draw on international expertise and experience and are therefore a vital resource for governments when developing regulations. National governments can make ISO standards a regulatory requirement (remember ISO standards themselves are voluntary). This has a number of benefits:


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§

Expert opinion: ISO standards are developed by experts. By integrating an ISO standard into national regulation, governments can benefit from the opinion of experts without having to call on their services directly. Opening up world trade: ISO standards are international and adopted by many governments. By integrating ISO standards into national regulation, governments help to ensure that requirements for imports and exports are the same the world over, therefore facilitating the movement of goods, services and technologies from country to country.

Certification – the provision by an independent body of written assurance (a certificate) that the product, service or system in question meets specific requirements. Registration – certification is very often referred to as registration in North America. Accreditation – the formal recognition by an independent body, generally known as an accreditation body that a certification body is capable of carrying out certification. Accreditation is not obligatory but it adds another level of confidence, as ‘accredited’ means the certification body has been independently checked to make sure it operates according to international standards. Box 3: Some Definitions

Principles of Effective Application of Standards § § § §

Standards to be precise Reflecting international norms Easily applicable Cost reducing


2

TECHNOLOGY AND DEVELOPMENT

• •

Background Technology as instrument for Development


Section 2: Technology and Development Background Technology is the "art, skill, cunning of hand"; and it is the making, modification, usage, and knowledge of tools, machines, techniques, crafts, systems, and methods of organization, in order to solve a problem, improve a pre-‐existing solution to a problem, achieve a goal, handle an applied input/output relation or perform a specific function. It can also refer to the collection of such tools, including machinery, modifications, arrangements and procedures. Technologies significantly affect human as well as other animal species' ability to control and adapt to their natural environments. The term can either be applied generally or to specific areas: examples include construction technology, medical technology, and information technology. Emerging technologies are those technical innovations which represent progressive developments within a field for competitive advantage. Emerging technologies in general denote significant technology developments that broach new territory in some significant way in their field. Examples of currently emerging technologies include information technology, nanotechnology, biotechnology, cognitive science, robotics, and artificial intelligence. Over centuries, innovative methods and new technologies are developed and opened up. Some of these technologies are due to theoretical research and others from commercial research and development. Technological growth includes incremental developments and disruptive technologies. An example of the former was the gradual roll-‐out of DVD as a development intended to follow on from the previous optical technology Compact Disc. By contrast, disruptive technologies are those where a new method replaces the previous technology and make it redundant, for example, the replacement of horse-‐drawn carriages by automobiles. This change continues into the contemporary day. Advocates of the benefits of technological change typically see emerging and converging technologies as offering hope for the betterment of the human condition.


Technology as an Instrument for Development New technologies offer opportunities that can be used to diversify national economies. Services, in particular those supported by new technologies, can be tapped to reduce dependence on commodities. Half of the countries in Africa derive more than 80% of their merchandise export income from commodities, and the need for new development paths to counter this dependence on commodities is especially important for least developed countries (LDCs), according to UNCTAD's 2012 Commodities and Development Report. Significant bottlenecks and challenges remain in developing countries, and particularly in Africa, where costs associated with ICT remain extremely high. As a result, the Middle East and Africa are estimated to handle a mere 1.6% of global e-‐commerce, although that is expected to grow to 3.5% by 2016. Rapid advances in mobile technologies and the widespread adoption of mobile telephony are empowering many low-‐income groups and unlocking entrepreneurial opportunities by providing access to global markets. With 95 per cent of existing phones worldwide having a basic browser or the possibility to have one, and 90 per cent of the world covered by a minimum GSM mobile telephone network, the minimum infrastructure required for providing mobile browsing is already available. See more at: http://www.tradeforum.org/article/Innovation-‐Technology-‐amp-‐Trade-‐ Development/#sthash.lbvfyzKZ.dpuf Meeting entrepreneurial needs The UNCTAD report shows that micro-‐enterprises in low-‐income countries are rapidly adopting mobile phones as key tools for advancing their commercial activities. In Niger, grain traders are benefiting from lower transaction and information-‐search costs. In Ghana and India, mobile phones have become critical equipment for fishermen and fishmongers, resulting in more efficient markets and improved livelihoods. For women’s weaving micro-‐enterprises in Nigeria, the phones have reduced transaction costs. In addition, producers are saving time and money by eliminating travel that used to be necessary in order to locate buyers and negotiate the best prices. Additionally in Bangladesh, a helpline has been set up offering information and advisory services to small-‐scale farmers with mobile phones. See more at: http://www.tradeforum.org/article/UNCTAD-‐Information-‐Economy-‐Report-‐2010-‐ICTs-‐ enterprises-‐amp-‐poverty-‐alleviation/#sthash.XCjfa6hB.dpuf


Example of Best Practices Box 4: Business Links, Investment and Banking In Benin the advantages are also clearly evident, particularly given the recent strides Viet Nam has made in cashew processing technology. Vietnamese firms make 80% of the machinery used by factories in Benin. ‘Five years ago, Viet Nam was not a known country for Africans. Since 2008, I see that OIF and ITC have accumulated business links between Viet Nam and Africa. This will pick up and this will be for the long term,’ said Guillaume Razack Ishola Kinninnon, General Manager of SWCM, a food processing and manufacturing company in Benin. Kinninnon added that one problem often encountered by exporters from both regions has been that letters of credit often had to be confirmed by a European bank – causing delays and increasing costs. As part of ITC’s methodology for promoting South-‐South trade, it has facilitated the establishment of direct interbank cooperation between the Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) and banks in Guinea Bissau, the Republic of Congo and Togo. Inter-‐bank partnership meetings were held in Hanoi, Viet Nam in January 2013 and in Yaoundé, Cameroon in November 2013. http://www.intracen.org/news/South-‐South-‐Trade-‐%E2%80%93-‐linking-‐Central-‐and-‐Western-‐Africa-‐to-‐ the-‐Mekong39s-‐Francophone-‐countries/


Box 5: Kenya’s Mobile Revolution An African e-‐innovation, affordable mobile money has played a major role in getting banking services to a wide segment of the population in East Africa. M-‐PESA, launched by Kenya’s Safaricom in March 2007, has been crucial in opening the door to formal financial services for Kenya’s poor and has had a significant effect on the Kenyan economy. It is estimated that Kenya, Madagascar, the United Republic of Tanzania and Uganda have more mobile money accounts than bank accounts, clearly demonstrating the greater levels of accessibility that new technologies offer compared with traditional banking. The incomes of rural households in Kenya have increased between 5% to 30% since they began using mobile banking, according to a study cited in Standard Bank’s September 2011 Africa Macro Insight and Strategy report. The 2012 Global Mobile Money Adoption Survey estimated that more than 60% of Kenya’s gross domestic product (GDP) and over 30% of the United Republic of Tanzania’s GDP moves through mobile money platforms. But mobile money is gaining currency elsewhere, too. Mobile money deployments in Côte d’Ivoire, Madagascar, Paraguay, Rwanda, Tonga and Zimbabwe range between 2% to 5% of GDP. The slew of development services that the growth in mobile money has enabled, from healthcare services to tips for animal husbandry, are just as important. The most sophisticated of ITC’s Trade at Hand services is in Kenya and uses a range of technologies – including M-‐ PESA, interactive voice response, radio outreach, cloud hosting, and even the blackboards on which farmers’ offers are displayed – to link smallholder farmers to food traders and export-‐ driven supply chains. For example, the Soko Hewani platform, which was upgraded in early 2013 with support from ITC, aids the Kenya Agricultural Commodity Exchange (KACE) in the daily collection and dissemination of commodity price information in regional markets. The technology provides farmers with up-‐to-‐date market information, enabling them to make more informed sales decisions. The project is initially expected to impact about 500 rural farmers each month – the buyers and sellers who physically visit KACE’s Market Resource Centres. Gradually, however, the project’s use of radio is expected to extend connectivity to regional markets, reaching a wider group of rural farmers who previously had little option but to take the prices they were offered by buyers and middlemen.


See more at: http://www.tradeforum.org/article/E-‐Commerce-‐and-‐Beyond-‐Opportunities-‐for-‐ developing-‐country-‐SMEs/#sthash.MuP8DLwP.dpuf

Fig 1: Kenya’s M-‐Pesa


3

ACCESS TO MARKET Background Messages on Market Success Challenges what micro-‐entrepreneurs face in growing their business Market Planning Cycle Strategic Tips for Market Access Current issues that face Market Access in the region Market Access Mapping Patterns of Protection Contingent Protection Opportunities for engagement with global market Trade Facilitation Technology and Trade Impact

• • • • • • • • • • • • •


Section 3: Market Access Background Improving access to markets is critical to achieving business growth. It is a persistent challenge for micro-‐entrepreneurs. Integration into global markets offers the potential for more rapid growth and poverty reduction but market barriers to some key developing country exports have made it harder for them to take full advantage of this opportunity. Access to Markets (ATM) services are becoming recognised as a critical way to support the growth of micro and small-‐scale enterprises. ATM programs are testing a wide range of marketing-‐related services with the goal of connecting entrepreneurs to additional or previously inaccessible customers, thereby increasing sales of and possibly income from the business. Often, micro-‐entrepreneurs are isolated from the market in which their product will compete. They are less likely than large firms to attend trade shows, read the relevant trade journals or engage in costly and extensive market research. Yet, a seller of dried mushrooms will have a much greater chance of success if he or she regularly reads the Mushroom Growers Newsletter. A good grasp of industry trends is essential to developing a high-‐end product with a realistic and clearly identified niche on the retail shelf. Regional markets provide the potential for higher volumes of sales through fewer buyers. They also present higher hurdles for new entrants. Of these hurdles, distribution is perhaps the most difficult for micro-‐entrepreneurs to overcome. Government regulations present micro-‐entrepreneurs with another information hurdle. Making sense of regulatory requirements can be difficult. In many cases regulations change, they are not well documented and are geared toward large industrial processing centers. To succeed, entrepreneurs need to learn which retail outlets hold sales potential for their product and how to access these markets. For any particular product, some markets hold greater sales potential than others. A viable product and a good understanding of target markets are not the only keys to selling a product. On top of this, an entrepreneur needs the people skills to develop contacts with distributors and retailers. Attending trade shows and visiting stores repeatedly are crucial to developing these contacts. The producer also needs to have the confidence and ability to convey that he or she has an attractive, high-‐quality product that will be in high demand. “Pounding the pavement” and promoting products can be an unfamiliar concept to overloaded or inexperienced micro-‐entrepreneurs.


Messages on Market Access Market access refers to the ability of providers of foreign goods and services to sell in a given country. For the purposes of market access negotiations in the WTO context, tradable items are subdivided into four groups—agricultural goods, textiles and clothing, industrial goods, and services. As different multilaterally agreed rules apply to each group, analytical and monitoring work usually follows the same pattern. Market Access and Tariff Market access for goods in the WTO means the conditions, tariff and non-‐tariff measures, agreed by members for the entry of specific goods into their markets. Tariff commitments for goods are set out in each member's schedules of concessions on goods. The schedules represent commitments not to apply tariffs above the listed rates — these rates are “bound”. Non-‐tariff measures are dealt with under specific WTO agreements. WTO Members seek to continually improve market access through the regular WTO work programme and through negotiations such as those launched at the Doha Ministerial Conference in November 2001. Market access and import regulations Countries have various different systems controlling the import of products. Often authorization from certification bodies and/or international product certification is required. Company Data in Trade Map Allows to link buyers and sellers providing with information on more than 500 000 companies based in more than 60 countries; Opportunities for exporters to reach international buyers searching for specific products Importing company also can look for potential suppliers based in many different countries. For more information: visit ITC website Box 6: Market Access

Challenges Micro-‐entrepreneurs face in Growing Their Enterprises ABR Handbook on Business Facilitation| 24

Table 1: KNOWLEDGE OF THE INDUSTRY

Industry Trends

Regulations

-‐ Learning what is required for:

-‐ Learning what sells

-‐ Products

-‐ Production

-‐ Pricing

-‐ Organic certification

-‐ Qualities

-‐ Packaging

-‐ Labelling

-‐ Packaging

-‐ UPC coding -‐ Product lines Markets

-‐ Learning what are: -‐ High potential markets -‐ Processes to access them -‐ Distributors to access them -‐ Requirements to sell in them SKILLS Developing:

BUSINESS

Learning to:

-‐ People skills to develop

-‐Determine competitive and profitable pricing

-‐ Promotional skills to represent product

contacts -‐ Project costs and break-‐evens -‐ Track, manage and deliver orders -‐ Implement useful business planning


Technical

Developing production skills to maintain safety and quality while increasing volume

Strategic Market Access Plans

Figure 2: Market Planning Cycle


Market Planning Cycle The stages in this planning process are explained below:

Stage 1. Assessment of Opportunities One approach to this is to examine the organization’s current position, and decide how the organization can improve it. There are a number of techniques that will help the organization to do this: •

SWOT Analysis :

This is a formal analysis of the organization’s strengths and weaknesses, and of the opportunities and threats that it faces. •

Risk Analysis :

This helps the organization to spot project risks, weaknesses in its structure or operation, and identify the risks to which you are exposed. From this the organization can plan to neutralize some risks. •

Understanding pressures for change:

Alternatively, other people (e.g. clients) may be pressing the organization to change the way it does things. Alternatively the organization’s environment may be changing, and you may need to anticipate or respond to this. Pressures may arise from changes in the economy, new legislation, competition, changes in people's attitudes, new technologies, or changes in government. A different approach is to use any of a whole range of creativity tools to work out where the organization can make improvements. •

Identifying the Goal of Organization’s Plan

Once the organization has completed a realistic analysis of the opportunities for change, the next step is to decide precisely what the aim of your plan is. Deciding and defining an aim sharpens the focus of organization’s plan, and helps the organization to avoid wasting effort on irrelevant side issues. The aim is best expressed in a simple single sentence. This ensures that it is clear and sharp in the perspective of the organization. If the organization has difficulty in formulating the aim of its plan, ask the following questions should be addressed:


• • • • •

What do the organizations want its future to be? What benefit does the organization I want to give to its customers? What returns does the organization I seek? What standards is the organization aiming at? What values vales does the organization believe in?

The organization can present this aim as a 'Vision Statement' or 'Mission Statement'. Vision Statements express the benefit that an organization will provide to its customers. For example, the vision statement for an SME is: 'To enrich the quality of our customers’ lives by providing the tools to help them to think in the most productive and effective way possible'. Mission statements give concrete expression to the Vision statement, explaining how it is to be achieved. The mission statement for this SME is: 'To provide a well-‐structured, accessible, concise survey of the best and most appropriate mind tools available'.

Stage 2: Strategies -‐ Exploring Options At this stage it is best to spend a little time generating as many options as possible, even though it is tempting just to grasp the first idea that comes to mind. By taking a little time to generate as many ideas as possible the organization may come up with less obvious but better solutions. Just as likely, it may improve its best ideas with parts of other ideas. -‐Selecting the Best Option Once the organization has explored the options available, it is time to decide which one to use. If the organization has the time and resources available, then it might decide to evaluate all options, carrying out detailed planning, costing, risk assessment, etc. for each. Two useful tools for selecting the best option are Grid Analysis and Decision Trees. Grid Analysis helps you to decide between different options where the organization need to consider a number of different factors. Decision Trees help the company to think through the likely outcomes of following different courses of action. -‐Detailed Planning Detailed planning is the process of working out the most efficient and effective ways of achieving the aim that the organization has defined. It is the process of determining who will do what, when, where, how and why, and at what cost. When drawing up the plan, techniques such as use of Gantt Charts and Critical Path Analysis can be immensely helpful in working out priorities, deadlines and the allocation of resources. ABR Handbook on Business Facilitation| 28

While you are concentrating on the actions that need to be performed, ensure that you also think about the control mechanisms that you will need to monitor performance. These will include the activities such as reporting, quality assurance, cost control, etc. that are needed to spot and correct any deviations from the plan. A good plan will: § § § § § §

§

State the current situation. Have a clear aim. Use the resources available. Detail the tasks to be carried out, whose responsibility they are, and their priorities and deadlines. Detail control mechanisms that will alert the organization to difficulties in achieving the plan. Identify risks and plan for contingencies. This allows the organization to make a rapid and effective response to crisis, perhaps at a time when the organization is at low ebb or are confused following a setback. Consider transitional arrangements – how will the organization keep things going while it implements the plan?

Stage 3: Implementation Once the organization has completed its plan and decided that it will work satisfactorily, it is time to implement it. The organization’s plan will explain how. It should also detail the controls that the organization will use to monitor the execution of the plan.

Stage 4: Measure -‐Evaluation of the Plan and its Impact Evaluating the plan gives you the opportunity to either investigate other options that might be more successful, or to accept that no plan is needed or should be carried out. Depending on the circumstances, the following techniques can be helpful in evaluating a plan: •

PMI (Plus/Minus/Interesting): This is a good, simple technique for 'weighing the pros and cons' of a decision. It involves listing the plus points in the plan in one column, the minus points in a second column, and the implications and points of uncertainty of the plan in a third column. Each point can be allocated a positive or negative score.

•

Cost/Benefit Analysis :


This is useful for confirming that the plan makes financial sense. This involves adding up all the costs involved with the plan, and comparing them with the expected benefits. •

Force Field Analysis : Similar to PMI, Force Field Analysis helps you to get a good overall view of all the forces for and against the organization’s plan. This allows the organization to see where you can make adjustments that will make the plan more likely to succeed.

•

Cash Flow Forecasts : Where a decision is has a mainly financial implication, such as in business and marketing planning, preparation of a Cash Flow Forecast can be extremely useful. It allows the organization to assess the effect of time on costs and revenue. It also helps in assessing the size of the greatest negative and positive cash flows associated with a plan. When it is set up on a spreadsheet package, a good Cash Flow Forecast also functions as an extremely effective model of the plan. It gives you an easy basis for investigating the effect of varying the assumptions of the organization.

•

"6 Thinking Hats" : 6 Thinking Hats is a very good technique to use to get a rounded view of the organization’s plan and its implications. It provides a context within which you can examine a plan rationally, emotionally, optimistically, pessimistically and creatively.

Any analysis of your plan must be tempered by common sense. If your analysis shows that the plan either will not give sufficient benefit, then either return to an earlier stage in the planning cycle or abandon the process altogether.

Closing the Plan Once the organization has achieved a plan, it can close the project. At this point it is often worth carrying out an evaluation of the project to see whether there are any lessons that you can learn. This should include an evaluation of the organization’s planning to see if this could be improved. If the organization is going to be carrying out many similar projects, it may be worth developing and improving an Aide Memoire. This is a list of headings and points to consider during planning. Using it helps the organization to ensure that it does not forget lessons learned in the past.


Strategic Tips for Market Access Plans Principles and modes of operation that guide the services, business and provide marketing activities in which they engage include: Sector Focus: Focus on specialties of the organization and those of its members. Learning: Staff, and the micro business owners with whom you work, are constantly learning about these sectors, including: 1) market trends and how to keep up with them; 2) what it takes for small firms to become market-‐ready; and 3) how to reach the markets that will bring the most return for small-‐scale producers.

Simple Guide to a Market Access Call Strategy 1. Start by mapping and understanding the local environment – what local processes are in place? Who is involved? What is their sphere of influence? Who are the decision makers, key influencers and implementers? 2. Understand their local priorities – what are their key challenges? What are their main objectives? What information do they need/like and when? 3. Tailor your messages to the needs of the customer base – different customers will need a different approach

Flexibility: Developing program Box 7 Simple Guide to Market Access that constantly responds to businesses’ needs, market opportunities and prospective partnerships. Customization: working with a wide range of clients and customizing services to best suit their needs, rather than offering a rigid, standard package of services. Networking: ABR primary strategy is to link producers, suppliers, retailers, distributors and community resources around immediate market opportunities and the long-‐term goal of developing a strong local infrastructure to support the growth of businesses. Partnering and Leverage: These linkages result in partnerships that bring additional services and opportunities. Leadership: ABR should take a leadership role in bringing together private sector and community players locally, regionally and nationally, and providing the resources and vision to the challenge of helping small-‐scale producers to access specialty markets. Strategic Readiness: Having a vision of working with a wide range of clients, providing a variety of services and working toward customized outcomes with each population group. Although there are often not enough resources to work on all fronts at once, staff members focus on particular activities with the big picture in mind. When opportunities arise and resources become available, staff members are ready to add or shift priorities accordingly. ABR Handbook on Business Facilitation| 31

Current Issues that Face Market Access in the Region Considerable potential for growth exists for both import and export trade in the region, especially with projected improvements in roads and other infrastructure. The overall potential for increasing trade from the countries in one region to other countries on the continent remains significant. For example, in 2005, Central, North and West African countries imported 18,000 tons of fresh and chilled beef and 328,000 tons of frozen bone in boneless beef from India, Brazil and Argentina. Egypt alone imported 103,661 tons of frozen liver and 4265 tons of frozen offal from the United States while central and West Africa imported 56,000 tons of frozen offal from Argentina. South Africa, Mauritius, Ghana, Central and West Africa also imported 36,000 tons of frozen mutton from New Zealand and Australia in the same year. This huge market potential provides opportunities to expand trade within the continent if the countries in the region with livestock surplus can compete on prices, sustain supplies, delivery schedule and quality. Market access continues to suffer from policy and investment biases based on poor understanding of countries’ economic potential, the dominance by outsider interests and investment agendas, and imposed policies and programs that are often inconsistent with local economic and environmental realities and priorities. Main market access barriers Import tariffs and other price-‐based border measures: government policies usually targeted at restricting market access in a particular commodity and raising budget revenue. These measures include: import duties, tariff quotas, and other border duties, levies, and charges. Nontariff border measures: government policies that may restrict market access through non-‐price instruments. Such measures include: quantitative restrictions (import quotas, direct prohibitions, domestic content requirements, licensing); contingency measures (antidumping, countervailing, and safeguard measures); technical barriers to trade (TBT) (regulations, standards, and testing and certification procedures); sanitary and phytosanitary measures (SPS) (food, animal and plant health and safety). Domestic policy measures: government policies, which may restrict market access if not applied uniformly to domestic and imported goods and services. These are: tax, competition, credit, and investment policies; price controls; and fiscal incentives, in particular, trade-‐distorting export subsidies and domestic support.


Negotiations on market access. The Doha Development Agenda envisages negotiations on market access in all the above areas. The current negotiating setup and the initial phase of negotiations are described in the companion staff report, “World Trade Organization-‐-‐The Doha Development Agenda and Selected Activities of Interest to the Fund,” (SM/02/225, 7/15/02). Source: WTO Box 8: Market Access Barriers

Currently credit flows from the bottom (producers and small-‐scale traders) of the value chain to higher-‐levels where large-‐scale traders and exporters and urban small businesses dominate. This paradox results from exporters and wholesalers delaying payments to actors down the chain until after they are paid. This pattern results in an unfair form of a credit subsidy. The issue of collateral for loans for both traders and herders is another challenge that needs to be dealt with by organizing credit to small-‐scale traders and producers.

Market Access Mapping Market Access Map Ø

Information on market access conditions allows importers/exporters and other actors to: •

Evaluate a possible market access advantage on the product relative to suppliers from other countries under different tariff schemes.

•

Select markets/market segments in which the product has the best market access advantage.

•

Evaluate the attractiveness of a country from a FDI (Foreign Direct Investment) perspective with respect to market access.

Features of Market Access Map Ø

Wide geographical coverage: •

Tariffs applied by different countries to the products exported by other countries and territories.

Ø

Wide coverage of instruments:

Ø

Preferences:

•

Ø

Ad-‐valorem tariffs, specific tariff quotas, antidumping duties and NTMs (non-‐tariffs measures).

•

Covers most bilateral and regional agreements

•

Rules of Origin and Certificates of origin also included for most agreements.

Analytical flexibility: •

Permits any analysis: by region, by economic sector or by measure.


Data Sources: •

Applied tariffs: ITC research from National Customs Institutions

•

Tariff quotas: from WTO (Agricultural notification of tariff quota) and national sources for bilateral and regional tariff quota agreements.

•

Trade data: from national sources, IDB (Integrated database), WTO and COMTRADE database of the United Nations Statistics Division (UNSD).

Box 9: Market Access Map

Patterns of Protection Successive rounds of multilateral negotiations have lowered average levels of protection. Industrial countries have generally set applied tariff rates close to their tariff bindings, enhancing the predictability and transparency of market access regimes. In contrast, most developing countries bind their tariffs at levels well above their applied rates so that they could in principle substantially increase their applied tariffs without infringing their WTO commitments. Applied tariff rates in 2001 varied considerably across country groupings. Despite the significant progress made in recent years, sub-‐Saharan African countries continue to have the highest simple average tariff protection (17.2 percent), followed by the Middle East and North Africa (16.8 percent). Among broad country groupings, it is notable that the average tariff of least developed countries (LDCs) (17.9 percent) is higher than that of other developing countries (14.0 percent) and well above that of industrial countries (5.2 percent). Averages of most-‐favoured-‐nation (MFN) applied tariffs by importing country or region provide, however, an incomplete picture of protection. First, a number of barriers are not covered by the standard MFN databases, including specific tariffs (that is an absolute monetary value per unit of imports), tariff rate quotas, prohibitions, contingent protection, the costs of rules of origin, and environmental and technical standards. Second, the averages do not capture the impact of tariff dispersion, in particular tariff peaks and escalation. Third, because of preference schemes and differing export structures, the barriers faced by exporters to the same market can vary widely. And, finally, uncertainty over market access, related to contingent protection, interpretation of norms and procedures, and the discretionary nature of many preference schemes, may represent a further disincentive to exporters.


Developing countries generally face higher barriers to their exports than industrial countries. Underlying that general result, however, there are large variations in market access conditions depending on the type of product and the particular exporter-‐importer combination. Table 2 presents combined ad valorem tariff equivalents (AVEs) of a range of protective measures, while taking into account preferences and export structures. The results suggest that EU protection is heavily skewed against imports from middle-‐income developing countries, and U.S. protection against imports from LDCs. The geographical patterns of Canadian and Japanese protection are less marked, although the former’s protection pattern appears tilted against LDCs and the latter against other low-‐income countries. Levels of protection in other OECD markets, and in middle-‐income developing countries as a group tend to be well above those in the Quad. Given the potential for trade among the developing countries, now at 40 percent of their total exports, barriers to this trade are increasingly significant.

Table 2: Effective Ad-‐Valorem Tariff Equivalents on Bilateral Trade Flows

Least Developed Countries

Importers

Canada

6.7

European Union

2.8

United States Other OECD

1

4.9 13.6

1

8.7

Developing Countries

(Total Trade) 5.4 4.4

7.0 6.4

6.2

…

Middle Income Countries

Japan

Exporters Middle-‐ Income Countries

Other Low-‐Income Countries

10.3 4.5 3.6

4.4 7.2 4.7 4.5

10.4

10.2

11.9

12.7

…

…

13.1

…

8.1

All Developing Countries

7.5

OECD

… … … … … … …

(Trade in Agriculture)

Canada

3.4

European Union

7.6

1

Japan

29.1

United States

28.1

1

Other OECD

19.6


18.2


18.7

16.3

17.5

33.7

13.4

24.8

20.0

41.6

9.5

13.0

12.7

14.5

…

17.0

14.5

16.3

28.0

…

…

18.4

21.2 35.4 23.1

Trade in Manufactures


21.9 32.5 …

28.3 42.1 …

Canada

European Union Japan

United States

0.0

1

0.1 8.0

1

4.2

2.0

2.9

2.0

5.0

1.4

2.5

1.2

5.7

5.9

Other OECD

5.0

10.8


6.0

11.1


7.7

…

…

5.5 2.1 5.7 …

10.9

4.5 3.6 7.4 6.4 …

2.5 1.6 7.4 6.9 …

Source: International Trade Centre (ITC). For the methodology in calculating AVES, see Bouët and others (2001)

The evidence indicates that impediments to trade in agricultural products remain far greater than in manufacturing trade (Table 2). In the Round, quantitative restrictions and other nontariff measures (NTMs) were converted into tariffs. While improving transparency, the modalities of conversion have in many cases allowed an increase in effective protection. Specific tariffs and tariff-‐rate quotas (TRQs), which are most frequent in agricultural trade, account for a significant share of the AVEs. Ad valorem tariff equivalents of middle-‐income developing countries are broadly comparable with those of the Quad. Note that these AVEs cover neither domestic measures of support nor the effect of export subsidies. As average industrial tariffs fell over successive trade rounds, pockets of protection have survived in products of particular interest to developing countries. Between 6 and 14 percent of Quad tariff lines are subject to tariff peaks, in some cases at rates well over 100 percent. Tariff peaks are also a prominent feature of tariff regimes in developing countries. Most preference schemes, moreover, offer little relief from tariff peaks. In Canada and the United States, tariff peaks are concentrated in textiles and clothing, and in the case of the EU and Japan, in agriculture, food products and footwear. Notably, estimates suggest that the capping of all peaks at the threshold of15 percent would reduce AVEs in textiles and clothing by around 20 percent for imports from most source countries into the United States, and by 59 percent for imports from China. In agriculture and food products, they would decline by 40–60 percent on imports into the EU. The pattern of protection creates particular hurdles for countries taking the first steps up the technology ladder. Protection is relatively low for primary products, but increases sharply for low-‐technology, labor-‐intensive food processing and light industries, declines somewhat in the medium-‐technology range—such as automotive products—and is lowest at the upper end of the technology spectrum. Since low-‐ income country exports tend to be labor-‐intensive,


the impact on their exports can be substantial: a recent study shows that revenue from duties collected by the United States on imports from Bangladesh is similar to that on imports from France, which are twelve times larger. A similar pattern can be observed within processing chains, where tariff escalation remains a major concern. By reducing demand for more processed imports from developing countries, tariff escalation hampers the expansion of their processing industries and export diversification. Protection is costly to both industrial and developing countries. Estimates of the static income gains from eliminating barriers to merchandise trade are substantial, ranging from US$250 billion to US$620 billion annually, of which around one-‐third to one-‐half would accrue to developing countries. A large share of the gains to industrialized countries would be due to the elimination of restrictions on trade in apparel and agriculture. Additional dynamic gains would stem from the supply response to the more favorable international trade regime (World Bank, 2002). Since much of the remaining protection is in agriculture, food products, and textiles and clothing.

Contingent Protection

Statutory protection in the form of tariffs and quotas is aggravated by contingent protection. Among the trade remedies permitted under WTO rules, anti-‐dumping has become by far the most widely used, in both industrial and developing countries. Since 1995, over 1,800 antidumping investigations have been initiated (Table 3). While industrial countries have traditionally been the main users of such measures, developing countries have been more active in recent years, led by India, Argentina, Brazil, and South Africa. In the seven years to 2001, developing countries initiated almost two thirds of all investigations, well in excess of their share in world trade. However, developing countries have also been the target of nearly 60 percent of investigations, mostly initiated by other developing countries. Table 3. Initiations of Antidumping Investigations, 1995-‐2001 Affected countries

Initiating Country

Number of investigations Industrial countries Of which: United States EU

Industrial Countries

United EU States


Transition Countries

Total

511 128 79 15

102 17

313 67

0 6

46 0


1,086 363 146 165

248 114 30 66

1,845 605 255 246

Developing countries Transition countries

379 4

85 0

242 4

718 5

131 3

1,228 12

Percent of investigations Industrial countries United States EU Developing countries Transition countries Source: WTO Secretariat

28 21 31 6 31 33

6 3 0 2 7 0

17 11 18 0 20 33

59 60 57 67 58 42

13 19 12 27 11 25

100 100 100 100 100 100

The recent steep rise in antidumping investigations puts at risk the predictability and nondiscriminatory application of trade policies. Recent enforcement practices have raised serious concerns about the influence of special interests on public policy, and may impose large costs on consumers and downstream industries in importing countries. Moreover, the deterrent effect of an investigation typically reaches well beyond the targeted exporter, and impedes incentives to pass on efficiency gains. The frequency of antidumping measures increases during, and may thus reinforce, economic downturns. Small firms and countries face greater uncertainty as they often lack the resources to challenge antidumping. Several reform proposals suggest that the introduction of competition law principles and of public interest clauses, giving affected importers and users legal standing to argue against protection, would reduce the protectionist bias of antidumping. Types of tariffs Ø

Ø

Ad-‐valorem tariffs •

Levied on the basis of the value of the product

•

Used by most countries; more than 87% of tariffs worldwide are ad valorem.

Specific tariffs •

Levied on the basis of volume or weight or number of units of the product.

•

Users of specific tariffs include: Switzerland (83,4%), Thailand (10,3%), Russia (11,8%), Argentina (11,3%), Belarus (12,1%), USA (9,4%).

Ø

Ø

Ø

Compound tariffs •

Contain both ad valorem and specific rates

•

E.g. 10% of the value + $2 per kilo (frequently applied by Japan, EU and Canada)

Mixed tariffs •

Minimum or maximum of 2 kinds of tariffs

•

E.g. Min or Max (10% * $2/kg)

Variable tariffs


•

Levied on the basis of the price of the products

Box 10: Types of Tariffs

Policy Implications The phasing out of tariff peaks and escalation is a critical element of the development dimension of the current round of multilateral trade negotiations. Tariff peaks and escalation bias protection in both industrialized and developing countries against agricultural, labor-‐ intensive, and low technology products. This holds back export-‐led growth and greater diversification in developing countries and the poverty reduction that is associated with increased demand for unskilled labor. A formula-‐based approach seems likely to be the best way to ensure a compression of tariff schedules across tariff lines. Experience has shown that formulas are less vulnerable to the influence of vested interests than the tariff line-‐item (“request-‐offer”) negotiations. At the same time, developing countries should be far more ambitious in binding tariffs at levels close to applied rates, in order to reduce uncertainty and reap the full benefits of liberalization. Disciplines on the application of contingent protection should be strengthened. This would require the full participation of all the main users. One approach would be for procedural rules to give greater weight to consumer concerns in considering trade remedy action. Short of that, the rules could be reviewed with a focus on methodological weaknesses, the potential for abuse, possibilities for raising the triggers or making them more rigorous (e.g., higher margins, sunset clauses, etc.), and the administrative costs anti-‐dumping and countervailing duty actions. Current rules allow national authorities a wide margin of discretion. A related risk is the possibly protectionist application of health and technical standards, which calls for careful monitoring and greater assistance to developing countries, both to enable their full participation in negotiations and in meeting standards. Adoption by all industrial countries of schemes that provide unrestricted market access for LDCs could have significant benefits without imposing undue costs on other suppliers, given the very small share of LDCs in world trade (around 0.5 percent). However, trade preferences can also have drawbacks. Apart from the economic inefficiencies, they risk creating vested interests


in the status quo, and should therefore be set firmly within a context of rapid multilateral liberalization. Improved market access for LDC exports will not be sufficient to engender a sustained growth performance, but should form part of a broader strategy to promote a vigorous supply response. Inefficiencies in key infrastructure sectors like telecommunications, transport, and financial services often add more to export costs than foreign trade barriers (World Bank, 2002). Protection in developing countries makes production for the home market more attractive. Further reform of developing countries’ trade and investment environments and progress on transparency and governance in the administration of foreign trade will often be necessary complements to better market access. This includes reducing the average level and dispersion of protection, maintaining an appropriate exchange rate regime, and liberalizing the policies towards foreign direct investment and key services sectors. The sequencing of policies often matters greatly. For instance, in a number of countries reductions in trade tariffs will need to be combined with a rebalancing of fiscal revenue sources. Market access Tariffication and bindings: Nontariff measures to be converted to bound tariffs at the start of the implementation period with average tariff cuts by industrial countries of 36 percent over six years from a 1986-‐ 88 base, and a minimum cut of 15 percent on any tariff line. Minimum import access: Tariff rate quotas were introduced to guarantee minimum market access by the end of the implementation period. Internal support Domestic support, as measured by the total Aggregate Measurement of Support (AMS), to be reduced by 20 percent from a 1986-‐88 base over the implementation period. Exempt are domestic supports of less than 5 percent, “green box” subsidies allowed for purposes such as development and technical progress, and “blue box” subsidies linked to output reduction schemes. Export subsidies Export subsidies to be reduced by 36 percent in value and subsidized exports by 21 percent in volume for each product over the implementation period from a 1986-‐90 base. Special safeguard Special safeguard provisions, triggered by volume increases or price reductions, permit the imposition of additional duties up to specified limits.


Developing countries Greater flexibility was given to developing countries in their commitments to market access, reductions in domestic and export subsidies (generally 2/3 of developed country commitment sand a longer implementation period of 10 years). Peace Clause Among other provisions, for subsidies excluded from the reduction commitments, the measures will be considered non-‐actionable in terms of countervailing duties and legal challenges in the WTO until the end of 2003.

Box 11: Uruguay Round: Principal Commitments on Agriculture

Opportunities for Engagement with Global Market Trade Preferences Most developing countries have preferential access to industrial country markets for a wide range of products. This departure from the traditional nondiscrimination principle of the GATT has been sanctioned under the so-‐called “Generalized System of Preferences” (GSP). In 2001, some 15 such schemes were in effect, though country coverageand preference margins over applied MFN tariffs varied widely. An important recent development has been the proliferation of bilateral and regional free trade agreements between industrial and developing countries. According to WTO rules, such agreements shave to cover substantially all trade, unlike GSP schemes. However, some of the problems of preferential schemes reviewed below—in particular the drawbacks related to rules of origin—apply in equal measure. Irrespective of their broader merits or shortcomings within the multilateral trading system, the benefits of many GSP schemes for their beneficiaries have been limited. Typically, preference margins are smaller for products that the importing country deems to be sensitive—which are also among the most protected. Moreover, as a large number of countries with often similar export structures tend to benefit from these and other schemes, the competitive advantage they convey is reduced. In addition, country and product specific graduation mechanisms may make exports ineligible for GSP treatment, and hence detract from incentives to invest in anticipation of continued benefits. In this context, there is evidence to suggest that the availability of unreciprocated market access preferences has undermined the incentives of ABR Handbook on Business Facilitation| 41

benefiting countries to engage in trade liberalization, thus at times perpetuating anti-‐export biases in their trade regimes. Preferential trade regimes invariably bring with them the monitoring of rules of origin to avoid trans-‐shipment. This appears to have reduced the benefits expected from such schemes. Rules of origin are akin to local content requirements. Costs arise both from exporters seeking to benefit from preferences by procuring inputs from less efficient sources (trade diversion), and from the administration of, and accounting for, origin. Under NAFTA, clothing imports into the United States market are subject to the “triple transformation rule,” according to which sourcing at all stages of prior transformation (yarn, fabric, and cutting/assembly) must obey value added thresholds. In the case of the EU, a recent study found that, partly as a result of unattractive rules of origin, only one-‐third of imports that were eligible for preferential treatment did in fact enter the EU market with reduced duties. This problem is particularly acute for textiles and clothing. In the case of Albanian exports, for instance, 84 percent of exports to the EU were eligible for preferential treatment, but only 2 percent actually requested or were granted such preferences. Cumulating of origin across beneficiary countries can mitigate the burden of rules of origin, though often at the expense of greater administrative complexity. Market access under GSP schemes has recently been enhanced on a regional basis, in particular for African countries. To date, 36 sub-‐Saharan African countries have qualified in principle for preferential access under the United States’ AGOA, adopted in2000. Margins of preference are substantial for textile and apparel products as well as for a range of other light manufactures and food products. In order to benefit from this scheme, countries have to meet, in addition to relatively tight rules of origin and standard GSP criteria, requirements relating to child labour and the protection of internationally recognized workers’ rights. The administrative requirement involved in documenting eligibility may explain why only 15 countries had availed themselves of benefits under this scheme in the year to March 2002, with most of the benefits accruing to four countries—Gabon, Lesotho, Nigeria, and South Africa— and with fuel accounting for 85 percent of AGOA imports. Nevertheless, since initiation of the scheme, sub-‐Saharan African exporters have increased their U.S. market share in textiles and clothing from approximately 1 percent in 2000 to1.6 percent in mid-‐2001 (in value terms). Conservative estimates suggest that by 2008 the volume of African exports to the U.S. market


may rise by an additional 6-‐7 percent. However, effective preference margins will decline as quotas under the WTO Agreement on Textiles and Clothing are phased out. A number of industrialized countries have recently granted comprehensive tariff and quota free access to LDCs. The EU’s EBA initiative has extended such preferential access since coming into effect in March 2001. It covers all products, except for sugar, bananas, and rice, which are to be liberalized more gradually. Unlike the EU’s GSP scheme, benefits under the EBA are extended on an indefinite basis, subject however to broad safeguards. At the G-‐8 Summit in Kananaskis, the Canadian government announced that duty-‐ and quota-‐ free access would be extended to imports from LDCs effective January 2003, with the exception of certain supply-‐managed agricultural products (dairy, poultry and eggs).Schemes providing for virtually unqualified duty-‐ and quota-‐free access for LDCs have also been adopted by New Zealand, Norway, and Switzerland. Results of the EBA initiative are not yet available, but earlier experience in the EU has shown that broad-‐based tariff-‐free market access for LDCs can assist in diversifying their export structures. Recent research suggests that under such schemes, if adopted by all Quad markets, LDC exports to the Quad might increase by US$2.5 billion, or about 11 percent, with relatively limited cost in terms of trade diversion.

Standards and Non-‐Tariff Barriers to Trade Many developing countries are concerned that they are ill-‐prepared to meet increasingly complex and burdensome standards and regulations. Standards and regulations on products and production processes play an important role in facilitating trade by ensuring quality, safety and technical compatibility. However, there is often a risk that such regulations may be captured by special interests, particularly when regulatory processes are not transparent. Conditions might then be imposed that are tighter than needed to achieve the safety and health objectives in order to serve a protectionist purpose. Technical barriers have become a key concern regarding market access. Annual notifications of new technical barriers (including health and safety standards, and product standards) to GATT/WTO increased steadily from a dozen or two in the early 1980s to over 400 in 1999. Low-‐ and middle-‐income countries reported that over the period from 1996–99 more than 50 percent of their potential exports of fresh and processed fish, meat, fruit and vegetables into the EU were “prevented” by their inability to comply with Sanitary and Phytosanitary (SPS) requirements (OECD, 2001b). SPS and other technical requirements have been viewed by developing country trade officials as a greater constraint on their ability to export than tariffs and quantitative restrictions. ABR Handbook on Business Facilitation| 43

One approach to measuring the importance of technical barriers to trade is to submit questionnaires to exporters or government officials. Henson and others (2000) surveyed government officials in 65 low-‐and middle-‐income countries. Respondents were asked to consider a range of factors that might impede their country’s ability to export agricultural and food products to the EU and indicate the significance of each on a five-‐point Likert scale from “very significant” (1) at one extreme to “very insignificant ”(5) at the other. Overall, SPS requirements were considered the most significant impediment to exports to the EU (this does obviously not imply that these standards are necessarily unreasonable). Other technical requirements, for example, labeling regulations or compositional standards were also considered significant impediments to trade. Mean Significance Scores for Factors Influencing Countries’ Ability to Export Agricultural and Food Products to the European Union

Rank Factor Mean Score

1 2 3 4 5

SPS requirements Other technical requirements Transport and other direct export costs Tariffs Quantitative restrictions

2.1 2.8 2.8 3.3 3.8

Source: OECD (2001b), based on Henson and others (2000).

Box 12. Technical Standards and Barriers to Trade

Developing countries have found it difficult to participate in designing standards in ways that better reflect their concerns and capabilities, and to challenge them where they were imposed in a discriminatory manner. A number of agreements in the Uruguay Round have sought to address these concerns by strengthening international rules governing product standards in order to minimize their abuse for protectionist purposes. However, they also entail substantial costs for product redesign, assessing conformity, creating an administrative system to monitor compliance, and quality control. Many developing countries will require stepped-‐up technical and financial assistance if they are to cope with the challenges posed by proliferating standards.


Specific Product market Textile: Textiles and clothing exports have been central to industrialization strategies, but barriers continue to be very high. Developing countries account for some 50 percent of world textile exports and 70 percent of world clothing exports. Several have developed a high dependence on these exports. Tariff barriers far exceed those on other manufactured products, in industrial and developing countries alike. Despite an international agreement to phase out quotas on textile and clothing trade, the vast majority is still in place. The back loading of quota removal by Canada, the EU, and the United States is set to cause sharp adjustment pressures at the end of the implementation period in early 2005, as quotas have protected less competitive suppliers in both industrial and developing countries. Agriculture: Agricultural liberalization in both industrial and developing countries is likely to have long-‐term, dynamic effects on developing country production and trade. Static gains alone would be on the order of US$30 billion in income and US$120 billion in exports per year. Increased investment and enhanced technologies could magnify the benefits of liberalization, but require a framework of supportive domestic policies and infrastructure (transport, logistics, credit, technical assistance).

Subsidies and Their Impact World trade in products of export interest to developing countries remains heavily distorted. Market access barriers and trade-‐distorting subsidies imposed by industrial countries tend to be skewed toward labor-‐intensive manufactures and agricultural products. The trade policies of the developing countries themselves target many of the same products, adding substantially to the burden they face in increasing and diversifying their exports. The need for greater coherence between trade and development policies, including better market access for developing country exports, is a central focus of the Doha Development Agenda of the World Trade Organization (WTO). Improving market access for developing country exports requires a comprehensive approach to liberalization. The Doha Development Agenda contains important commitments but this initial effort needs to be sustained. Particular issues include: §

The phasing out by all countries of tariff peaks (tariffs of 15 percent or higher) and escalation (tariffs rising with the degree of processing of imports) is critical to the development dimension of the current round of multilateral trade negotiations, and could best be achieved through formula approaches that ensure deep across-‐the-‐board reductions.


§

§

§

§

§

Disciplines on the application of trade remedy action should be strengthened— including through reviews of existing rules to deter their use as protectionist devices—and developing countries should receive more assistance to implement product and process standards. Schemes that provide unrestricted market access for all least developed countries should be extended by all large trading nations (with liberal rules of origin) but set within a framework of multilateral liberalization. In agriculture, meaningful liberalization must cover border protection and subsidies in industrial as well as developing countries. OECD countries should seek to de-‐link agricultural income support from production levels. Reforms of subsidy and tariff regimes should proceed in parallel in order to soften the impact on net food importing countries. In textiles and clothing, the priority must be to accelerate the removal of quotas in order to avoid an adjustment shock in 2005 as a result of the phasing out of quotas under the Uruguay Round Agreement on Textiles and Clothing. The simultaneous reduction in import tariffs would help to mitigate adjustment pressures. Reform of market access in developing countries themselves would contribute as much to a development-‐oriented multilateral trading system as OECD policies. Apart from domestic efficiency gains and a reduction in remaining anti-‐export biases, developing countries are increasingly large markets for each other.

Trade Facilitation Trade facilitation looks at how procedures and controls governing the movement of goods across national borders can be improved to reduce associated cost burdens and maximise efficiency while safeguarding legitimate regulatory objectives. Business costs may be a direct function of collecting information and submitting declarations or an indirect consequence of border checks in the form of delays and associated time penalties, forgone business opportunities and reduced competitiveness.


Understanding and use of the term “trade facilitation” varies in the literature and amongst practitioners. "Trade facilitation" is largely used by institutions which seek to improve the regulatory interface between government bodies and traders at national borders. The WTO, in an online training package, once defined trade facilitation as: “The simplification and harmonisation of international trade procedures” where trade procedures are the “activities, practices and formalities involved in collecting, presenting, communicating and processing data required for the movement of goods Fiscal: Collection of customs duties, excise duties and other in international trade”. indirect taxes; payment mechanisms In defining the term, many trade facilitation proponents will also make reference to trade finance and Environment and health: Phytosanitary, veterinary and hygiene the procedures applicable for controls; health and safety measures; CITES controls; ships’ waste making payments (e.g. via a Consumer protection: Product testing; labelling; conformity commercial banks). For example checks with marketing standards (e.g. fruit and vegetables) UN/CEFACT defines trade facilitation as "the simplification, Trade policy: Administration of quota restrictions; export refunds standardization and harmonisation Box 13: Examples of Regulatory Activity in of procedures and associated International Trade information flows required to move goods from seller to buyer and to make payment". Safety and security: Security and anti-‐smuggling controls; dangerous goods; vehicle checks; immigration and visa formalities

Occasionally, the term trade facilitation is extended to address a wider agenda in economic development and trade to include: the improvement of transport infrastructure, the removal of government corruption, the modernisation of customs administration, the removal of other non-‐tariff trade barriers, as well as export marketing and promotion. Reference to trade facilitation is sometimes also made in the context of "better regulation". Some organisations promoting trade facilitation will emphasise the cutting of red tape in international trade as their main objective. Propagated ideas and concepts to reforming trade and customs procedures generally resonate around the following themes: § § § § §

Simple rules and procedures Avoidance of duplication Memoranda of Understanding (MoUs) Alignment of procedures and adherence to international conventions Trade consultation


§ § § § § § § § § § § § §

Transparent and operable rules and procedures Accommodation of business practices Operational flexibility Public service standards and performance measures Mechanisms for corrections and appeals Fair and consistent enforcement Proportionality of legislation and control to risk Time release measures Risk management and trader authorisations Standardization of documents and electronic data requirements Automation International electronic exchange of trade data Single Window System

Technology and Trade Electronic trading, sometimes called e-‐trading, is a method of trading securities (such as stocks, and bonds), foreign exchange or financial derivatives electronically. Information technology is used to bring together buyers and sellers through an electronic trading platform and network to create virtual market places such as NASDAQ, NYSE Arca and Globex which are also known as electronic communication networks (ECNs). Electronic trading is in contrast to older floor trading and phone trading and has a number of advantages, but glitches and cancelled trades do still occur. Electronic trading systems are typically proprietary software (e-‐trading platforms or electronic trading platforms), running on COTS hardware and operating systems, often using common underlying protocols, such as TCP/IP. The move to electronic trading compared to floor trading continued to increase with many of the major exchanges around the world moving from floor trading to completely electronic trading. Trading in the financial markets can broadly be split into two groups: §

§

Business-‐to-‐business (B2B) trading, often conducted on exchanges, where large investment banks and brokers trade directly with one another, transacting large amounts of securities, and Business-‐to-‐consumer (B2C) trading, where retail (e.g. individuals buying and selling relatively small amounts of stocks and shares) and institutional clients (e.g. hedge


funds, fund managers or insurance companies, trading far larger amounts of securities) buy and sell from brokers or "dealers", who act as middle-‐men between the clients and the B2B markets.

Impact The increase of electronic trading has had some important implications: Reduced cost of transactions – By automating as much of the process as possible (often referred to as "straight-‐through processing" or STP), costs are brought down. The goal is to reduce the incremental cost of trades as close to zero as possible, so that increased trading volumes do not lead to significantly increased costs. This has translated to lower costs for investors. Greater liquidity – electronic systems make it easier to allow different companies to trade with one another, no matter where they are located. This leads to greater liquidity (i.e. there are more buyers and sellers) which increases the efficiency of the markets. Greater competition – While electronic trading hasn't necessarily lowered the cost of entry to the financial services industry, it has removed barriers within the industry and had a globalisation-‐style competition effect. For example, a trader can trade futures on Eurex, Globex or LIFFE at the click of a button. He or she does not need to go through a broker or pass orders to a trader on the exchange floor. Increased transparency – Electronic trading has meant that the markets are less opaque. It's easier to find out the price of securities when that information is flowing around the world electronically. Tighter spreads – The "spread" on an instrument is the difference between the best buying and selling prices being quoted. It represents the profit being made by the market makers. The increased liquidity, competition and transparency means that spread have tightened, especially for commoditised, exchange-‐traded instruments. For retail investors, financial services on the web offer great benefits. The primary benefit is the reduced cost of transactions for all concerned as well as the ease and the convenience. Web-‐ driven financial transactions bypass traditional hurdles such as logistics.

Other Aspects Related to Trade and Technology § § § §

E-‐commerce Electronic trading platform Electronic communication network Stock market data systems


§ § §

Straight-‐through processing (STP) Trading room 2010 Flash Crash

The microenterprise field has much to learn about e-‐commerce and its benefits and costs to micro businesses. E-‐commerce presents similar barriers for small-‐scale producers, some opportunities for access and some additional different challenges. Similar challenges include developing market knowledge, market ready products and business skills. Depending on the market channel used on the internet, different additional opportunities and challenges arise. For example: §

Internet sales through existing, large-‐scale retailers can be as challenging for small producers as selling through a national grocery chain.

§

By accessing virtual malls or listing products on auction sites, producers can control the quantity offered and are likely to attract small orders and therefore, can produce in manageable quantities.

They also can ship their products without a distributor. If stock falls low, advertisements and listings can easily be removed without presenting an image of unreliability. Hosting a company website circumvents much of the cost and knowledge involved in gaining access to other company sites and markets. Major challenges include the costs of designing and maintaining a site, particularly a secure site where customers can use credit cards, and attracting enough appropriate customers to the site.


4

USING MEDIA AND INFORMATION TECHNOLOGY

• • • • • • • • • • • •

Background Engaging Media for Advocacy Messages Follow-‐up and Maintaining Contacts Telling Stories Pragmatism Targeted Advocacy Creative Presentations Press Release and Kits Harnessing Regional and International Conferences Training and Advocacy Digital Progress and Changing Dynamics


Section 4: Using Media and Information Technology Background The ability to create, acquire and adapt new technologies is a critical requirement for competing successfully in the global marketplace. Various international forums and agreements on technology access and technological capacity building have recognised the importance of the transfer of technology, especially to developing countries. It is also a well-‐documented fact that the African continent has not kept pace with technological advancement. Africa's technological gap could be the source of its increasing economic deterioration because other developing regions are constantly upgrading their own technological capabilities, and the global marketplace has become increasingly liberalized and competitive. Effective technology strategies are based on a clear understanding of the basic unit of technological activity, the industrial firm, which imports, masters, uses and improves technology. It also subsequently stimulates the demand for innovative technologies. For the process to thrive, it needs active, supportive and dynamic government policies and institutions. Efficient technology use goes beyond importing machinery. It entails building capabilities, technical understanding and an informational base, acquiring new technical skills and managerial practices and forging linkages with other firms and institutions. It requires the ability to understand and master new technology; to adapt it to local factors and conditions; and to upgrade it as technologies improve and new products appear. Different firms use the same technology at vastly different levels of efficiency. Moreover, countries vary in their technological capabilities. Technological competitiveness lies in the effectiveness with which countries promote capabilities. Firms in developing countries often lack the expertise to determine which new skills, technical knowledge and organizational techniques are required to make newly imported technologies function at optimal levels. Changes in traditional mind-‐sets are required to form interactions and linkages with other firms or institutions, and to build technical know-‐how, as well as to overcome the problem of “leakage” of trained workers. Firms may not have access to the information, skills, financing or other factors needed to develop their capabilities. Furthermore, not all activities involve the same degree of effort or cost. For instance, learning needs may be lesser in apparel manufacturing than in the making of advanced electronics or machinery. They also vary with ownership: new knowledge and technology might be more


accessible to multinational affiliates than to local small and medium-‐sized enterprises (SMEs). Effective learning is further constrained among firms by a lack of coordination. Restrictions on learning within firms include reluctance to change, risk aversion, lack of knowledge and inability to undertake learning processes. Corrective policies are needed in order to promote national technological growth. The manufactured exports provide useful indicators, particularly in country comparisons, of the technological strength and specialisation of the industrial sector. While they do not capture trends for non-‐trade activities, they provide an overview of underlying technological activity. This section places in an international context the performance of Africa in general and the case study countries in particular. In general, technology-‐intensive structures are expected to be more beneficial because: § Activities with rapid product or process innovation enjoy growing demand visà-‐vis technologically stagnant activities. They also grow faster because they substitute for other products (final or intermediate) and stimulate demands for other technology-‐ based products, thereby quickening the pace of production, employment and exports. § Technology-‐intensive activities are less vulnerable to entry by competitors compared to low-‐technology activities where scale, skill and technology requirements are more modest. § Technology-‐intensive activities offer higher learning and productivity potential as well as greater spill over benefits for other activities. Thus, they lead to faster growth in capabilities, greater diffusion and higher quality capabilities. A technology-‐intensive structure is thus likely to offer greater systemic benefits in terms of learning and innovation. § Capabilities developed in technology-‐intensive activities are more attuned to technological and market trends, giving the ability to respond more flexibly to changing conditions. In the emerging global environment, they provide more valuable competitive skills.

Engaging Media for Advocacy ABR engagement with media for advocacy is critical for visibility and coverage. Media messages enhance credibility to the work and initiatives of the ABR and are members. The strategy is to cultivate the relationship with the media houses to ensure that the stories and coverage are always accurate. Media reporting can sometimes be skewed on how they write, edit and publish stories.


Massages The messages from ABR targeting the media need to be simple. The press like to see complex business issues translated into simple terms. The business stories from ABR and its members should be simple and precise to attract media audience. This minimizes the risk of distortions. Media is one of the tools of advocacy and business learning in the region.

Follow-‐up and Maintaining Contacts ABR has to stay on the lookout for what is reported about its business engagements and initiatives. If the coverage is favorable, keep in touch with the media house issuing the reports. Supply them with progress reports and other case stories about emerging issues on the business in the region.

Telling the Case Stories A great part of the work of ABR is advocacy and communicating the vision, innovations and solutions from its members. Developing case stories for the media helps to establish and encourage information sharing and learning.

Pragmatism ABR’s work is pragmatic and business driven. It is not only of interest for ABR to service its members, but also its work is tailored to reach specific audience in the region. For the general public audience, the quantitative numbers that emanate from the operations of the ABR initiatives should be translated into understandable and easy to use packages. Key documents including research findings, studies and evaluation reports provide useful data and information. These can be translated and packaged for members’ consumption and public awareness on the state of business in the region.

Targeted Advocacy ABR will always attempt to develop unique stories that fit and portray the interest of the members. Focus on one innovation and promote one invention at a time. Resist temptation of overloading the message to the media. Patience and focus are key principles for advocacy through media.

Creative Presentations The gallery of picture from ABRM combined with words can be used for creative empathy and messages are captured by using appealing photos and graphic visuals. Use the power of pictures and photos to showcase the work of ABR members.


Press Releases and Kits The press releases can be used by ABR to break the news on innovations by the members. It can be used for publicity. Press releases are powerful tools for communicating with government agencies in the region. The press releases need to be followed up by ABR Secretariat, the respective members or both in order to gain further attention. For complex issues involving research findings, case studies and survey, ABR can establish press kits. These can be used for advocacy campaigns on new products and marketing.

Harnessing Regional and International Conferences A number of conferences and meetings where ABR participate can be used to organize side shows to organize press conferences to propagate ABR initiative. Press conferences provide opportunities for members to illustrate emerging solutions and their potential applications in the region. ABR Participation in the Work of the Economic and Social Council and its Subsidiary Entities 1) Bending the Arc, 4 July 2005, London, (along G8 Summit): The ABR was member of the organizing committee of Bending the Arc. ABR president, Dr Bamanga Tukur pronounced the opening address and participated during the Africa Union Summit session; 2) Business and Millennium Development Goals. Organizers: Inwent Capacity building, World Bank Institute, UN Global compact. The event was held in New York from 11 to 13 September 2005. The ABR President th represented the ABR during the 10 International Business Forum as a speaker on the theme “The role of the private sector in Development”; 3) United Nations General Assembly held on 16 September 2005 in New York: the ABR President was a speaker on the theme: “The vital role that business plays in meeting the societal commitment embodied in the Millennium Development Goals”; 4) Annual New Partnership for Africa’s Development Summit was held at the United Nations Headquarters on 18 September 2006: The ABR President representing the African Business Roundtable chaired the Summit along with Professor Firmino Mucavele, CEO of NEPAD Secretariat, Joseph Legwaila, United Nations Under-‐Secretary-‐ General and Amin Dossal, Executive Director of the United Nations Funds for International Partnership; 5) High Level Summit of the United Nations Economic and Social Council (UNECOSOC) held on 5 July 2006 in


New York at the United Nations Headquarters: Roundtable meeting on the challenges of employment creation in Africa and the Least Developed countries (LDC). The ABR President was a speaker on the theme: “Creating an environment at National and International levels conducive to generating full and productive employment and decent for work for all and its impact on sustainable development.” 6) International Conference on Financing for Development to review the implementation of the Monterrey Consensus. The ABR was on the Steering Committee and participated actively during the Second International Business Forum held along with the conference. The ABR President was a speaker during the opening address as well as the moderator during the session “Proposals for building enabling environment and enhancing donor effectiveness.” Box 14: ABR Contribution to High Level Conferences

Training on Advocacy The training relating to harnessing the media on addressing particular business problems or solutions can be in the form of seminars. These can bring in experts on specific research topics and innovations by ABR or its members to explain technical issues that the media may want to capture.

Digital Progress and Changing Dynamics Digital progress and changing information dynamics provide opportunities for electronic networking. ABR website should be used as a strategic tool for message dissemination. The messages on ABR website must be compelling and easy to use. The website should be understood as broadcasting tool. Messages have to be strategic. The ABR website must be kept current.


5

TOOLS AND SELF-‐ AWARENESS RESOURCES

• • • • • • • • •

Background ABR Brand ABR Core Values ABR Messages on Business Elements of Market Planning Awareness Creation on ABR Communication Strategy Using ABR partner Map ABR Quantitative and Qualitative Data Crafting Effective ABR Business Messages ABR Reports as Marketing Instruments


Section 5: Tools and Self-‐Awareness Resources Background This section provides tool and resource that can be used for advocacy. It also suggests that some of the tools need to be established or built. Some of the identified tools show how to utilize the existing resource or the knowledge emanating from ABR initiatives such as research, survey and monitoring and evaluation. These tools can be adapted to suit the needs of the Secretariat or the members. They include: § § § § § § § § § § § § § § § §

ABR brand messages Messages on business environment Element of strategic marketing plan Mapping of partners Monitoring and evaluation tools Building on quantitative information Developing effective messages around ABR initiatives Awareness creation on ABR business strategies Using ABR report as advocacy and marketing instruments Using technology for market access Using conformity to standards for expanding competitiveness Harness media for visibility Press releases Press kits Creative presentations Visual communications

§ Planning press conference

ABR Mission The ABR is dedicated to achieving an African private sector led regional economic integration and sustainable economic development of Africa, based on good corporate governance and competitively open market systems. The ABR focuses on: •

Strengthening the African private sector.

•

Promoting intra-‐African trade and investment.

•

Attracting foreign investment into Africa to transform the Continent from ‘aid-‐receiving’ to private sector partnerships in economic development.


ABR Core Values The ABR is committed to the realization of its Vision through the commitment of its members, who shall be policy level executives of member companies and individuals, to the following Membership Core Values: •

Conviction that an African private sector-‐led development is the key to unlocking the potential of African economies.

•

Ethical business practices are the foundation of an enduring private sector.

•

Good economic and corporate governance is essential to sustainable economic growth and development.

•

Open dialogue and the free flow of ideas foster innovation, change, reduced conflict, improved understanding and consensus.

•

Regional integration based on competition and open market systems.

•

Attractive climate for intra-‐African trade and investment and foreign direct investment.

•

Objective research.

ABR Messages on Business Aims and Processes of the ABR The aim of the ABR is to help create an enabling environment conducive to good governance, responsible private investment and sustainable economic growth and development in the countries of Africa. To do this, the ABR sponsors conferences, workshops, seminars, research, information Services, investment related services, and educational activities.


Activities The major activities of the ABR are founded on dialogue, research and communication. ABR programmes are focused on continuous and effective dialogue, which provides opportunities for business leaders and youth to meet regularly amongst themselves, and with public sector officials building partnership

for

investment

opportunities and consensus on policy reforms.

Elements of Market Planning

The African Business Roundtable in fulfilling her role towards promoting, encouraging and supporting entrepreneurial drive in youth awarded scholarship grant to the SAGE club of JSS Jikwoyi, Abuja. The gesture is in furtherance to ABR mentoring role to JSS Jikwoyi SAGE club and also in recognition of their worthy achievement over the years at the SAGE global tournaments. Sage Global mission is to help create the next generation of entrepreneurial leaders whose innovations and social enterprises address the major unmet needs of our global community. As the foremost private sector led not-for profits organization, the African business Roundtable is committed towards raising the next generation of entrepreneur's across the continent of Africa.

that can be used to achieve this.

The ABR Scholarship has contributed to the training and grooming of more than 5,000 young Entrepreneurs thus creating thousands of job opportunities

They include:

Box 15: ABR and Youth Entrepreneurship Program

There are a number of techniques

§

SWOT Analysis, involving analysis of strengths and weaknesses, and of the opportunities and threats that you face.

§

Risk Analysis , used to spot risks and weaknesses in the organization or operation, and identify the risks to which the organization is exposed.

§

Understanding pressures for change: pressures may arise from changes in the economy, new legislation, competition, changes in people's attitudes, new technologies, or changes in government. A different approach is to use any of a whole range of creativity tools to work out where the organization can make improvements.

§

Identifying the Goal of Your Plan: Making precise decision on what the aim of the organization plan is. Deciding and defining an aim sharpens the focus of your plan, and helps you to avoid wasting effort on irrelevant side issues.

Awareness Creation on ABR Communication Strategy §

Reaching out to partners and other business group

§

Establish Awareness Creation Team (ACT)

§

ACT determines goals and engages other business groups


§

ACT develops appropriate messages

§

ACT articulates ABR strategic business communication plans

§

ACT formulates messages for different target audience

Using ABR Partner Map It is important to know who the ABR partners are. Mapping of the categorization of the partners is an important first step in planning strategic efforts to expand the outreach. This will give a clear picture on how to prioritize coalition building, maximize resource of each partner, turn negative into positive and preventing positive from becoming negative and determining how the organization can work together with partners for change. The grid below (Box…) is used to understand the attributes and detriment of ABR partners. This will help in building coalition. Positive

Negative

Quadrant 1

Quadrant 2

ADB

UNDP

ECOWAS

UN ECOSOC

UNECA

UNIDO

ITC

Quadrant 3

Quadrant 4

SADC chamber of commerce

ACBF

Ethiopian chamber of commerce

NEPAD

Pan African chamber of commerce (head office)

WEF -‐ World Economic Forum

South African chamber of commerce and

Active

Passive

industry


SADC

CEEAC , IGAD

BUSA (Business Unity South Africa)

All chambers of commerce and industry

Nigeria chamber of commerce

Ivory coast of commerce

Box: 16 Mapping of Key ABR Partners

Zimbabwe chamber of commerce Zambia chamber of commerce

Quadrant 1: This indicates those partners that support one or more of the initiatives of ABR and who are active in implementing the initiatives. A number of multilateral agencies fall in this quadrant. This provides a window for further collaboration and funding for new initiatives Quadrant 2: In this quadrant, the partners are those that are negative but are actively expressing their opinion on what ABR should focus on and how to attract more activities by the governments in the region. The partners in this quadrant provide useful insight on how best to improve partner relationship and expand coalition. Quadrant 3: This quadrant show those partners who are generally positive about the ABR initiatives but who do not take much action or express their opinions or support. A number of partners fall in this quadrant. It is the quadrant of opportunity. ABR can develop a strategic approach to convert the partners in this quadrant to those that are active and positive. Quadrant 4: The partners in this quadrant generally have negative opinions about ABR initiatives and how they can best be achieved. They are passive and do not often express their opinion or support.

Map of Partners used for strategic planning to expand market The map of partners can be used for strategic planning for tailoring messages to target partners in particular quadrants. For instance more energy should be placed on partners who are passive and positive to make them active. Not much time should be spent on those who are already


active and positive. They should however, not be forgotten. They should be kept informed and engaged. Some champions can be identified from quadrant 1 to act as ambassadors.

Determination of how ABR is perceived among the Partners It is important to determine the perception of partners on the work of ABR in order to create self-‐awareness. This can be established by investigating the following: §

What do members say about ABR

§

What do other Business Actors say about themselves

§

What do other Business Actors say about ABR

§

What does ABR say about other Business actors

This can best be achieved through structured group discussions in an informal brainstorming manner.

ABR Quantitative and Qualitative Data The quantitative information and data is to help the members and partners to understand the trends and performance of ABR. It provide hard facts on the standing of the organization and promotes credibility on the efforts by the organization.

Description of ABR in quantitative terms The ABR has more than 145 corporate members and 3 associate members (chambers of commerce) with thousands of their respective members. The ABR Scholarship has contributed to the training and grooming of more than 5,000 young entrepreneurs thus creating thousands of job opportunities.

Description of ABR in qualitative terms On the development of small and medium scale enterprises, ABR collaborated with the Government of Plateau State in Nigeria and succeeded in training over 500 beneficiaries from all the Local Government Areas of the three senatorial districts of the state. Participants included youths, women (widows) and cooperative Associations and retirees who were given intensive coaching in enterprise development, practical skills acquisition in candle and chalk production, and were then linked to the collaborating Banks (Bank of Industry, Nigeria and Nigerian Export-‐Import Bank) for project financing.


Quantitative and Qualitative data used to promote Market Access African Business Roundtable in collaboration with Student Advancement for Global Entrepreneurship (SAGE) and SAGE Club of Junior Secondary School (JSS), Jikoyi in the Federal Capital Territory (FCT) of Nigeria organized an enterprise training workshop for students of secondary schools in the FCT. Over 250 selected students and teachers representing about twelve schools participated. ABR donated entrepreneurship books worth over $5000.00 USD to the students. These young entrepreneurs have won the SAGE World cup three consecutive times in 2007, 2008 and the last one in Brazil in August 2009 as part of global market orientation. The JSS Jikoyi SAGE Club have impacted positively on their community, training other students, widows and youths in skill acquisition and environmental awareness campaign, corporate social responsibility and enterprise development

Crafting Effective ABR Business Messages ABR’s overall message is to achieve an African private sector led regional economic integration and sustainable economic development of Africa, based on good corporate governance and competitively open market systems.

ABR Reports as Marketing Instrument The reports produced by ABR constitute a platform for building and reinforcing knowledge creation information sharing. The purpose of the report is: (i) public information (ii) credibility mobilization. ABR reports are meant to communicate key messages to spark continuous improvement for business environment in the region. These can be useful tools for advocacy and marketing. In principle developing, ABR reports should include: production process, dissemination, and follow-‐up.

§ Production of Reports

o Target recipients

o Guideline for ABR reports

o Regularity of reports

o Research and innovations

o Timing

§ Follow up report effectiveness

o Engaging academia o Country consultations for

o Media

product priorities

o Round Tables

o Training

o Press releasers

§ Dissemination

o Technical briefs

o Via mails or e-‐mails o Knowledge management ABR Handbook on Business Facilitation| 64

6

Monitoring and Evaluation

• • • •

Background Mechanism for ABR M&E Monitoring Evaluation


Section 6: Monitoring and Evaluation Background The Monitoring and Evaluation within the framework of ABR should be designed to support the initiatives by the members and cooperating business partners. It should focus on the goal of promoting application of appropriate M&E methodologies to provide insights of the performance of the various initiatives by the members. The key assumptions that underlie the monitoring and evaluation approach of ABR is that the business initiatives have been developed based on expectation to achieve particular quantifiable results. The ABR Secretariat and its members are able to use quantifiable results to re-‐orient their planned operations. It is also assumed that in ABR’s context, evaluations are not seen as an event at the end of an initiative, but instead as an important part of the operations of ABR whose function is to assess progress towards goals of the members and to feed into the business planning and improving future initiatives. Considering that the business initiatives are ultimately aimed at profit making to improve the wealth creation, the evaluation mechanism should be designed to help the member to determine the trend in their businesses. Monitoring and Evaluation should also help in the process of risk detection and identifying mitigating actions.

Mechanism for ABR M&E The mechanism for M&E should span the entire cycle of business activities and investment by the ABR members. Participation of the members in monitoring and evaluation of their initiatives will help to ensure that the type of initiatives they undertake remain relevant to the overall goal of the ABR. The key to the successful implementation of the initiative by the ABR members is the timely identification of problems and prompt corrective action to solve them. To be able to identify the problems and anticipate potential one require that a good and well managed information system for data collection, collation and retrieval is in place. This is the service that the ABR Secretariat could endeavor to promote in order to prove M&E services to the members. M&E would be a useful tool for gathering, analysing and utilising information to determine the changes in the business sector where the ABR members operate. The M&E approach for ABR should not only focus on gathering information about progress of particular business initiatives but also ensure their effectiveness and efficiency in utilisation of their investible resources. The approach must therefore, go beyond the engagement of the


members and consider external factors beyond ABR and its members. Currently there is no systematic framework for monitoring and evaluating the initiatives of the ABR.

Monitoring Monitoring and Evaluation are related but distinct. Monitoring is the provision of information, and the use of information to enable members of ABR to assess effectiveness of their initiatives and planned investments. Monitoring is an internal ABR activity aimed at keeping the members informed. It is an essential part of good management practice and therefore an integral part of regular management of the initiatives by ABR. A good monitoring approach for ABR members should focus on: § § § § § § § §

Describing the relative importance of the initiatives by the members in reaching the goals of ABR Assessing effectiveness of the implementation of the initiative by the members of ABR Periodically assessing the emerging results in relation to the objectives of the ABR Acknowledging the contribution from the partners and associates Measuring successes and failure of the initiatives of ABR Capturing extraneous factors Highlighting the need for lesson and practices for learning Ensuring effective and efficient information and data gathering focusing on investments and expected income flows.

Evaluation Evaluation would aim to assess the overall outcomes and effects of ABR interventions. Evaluation of ABR initiatives in the region should aim at determining whether the initiatives meet the expected goals and objectives of the members. The results of evaluations should provide lessons and practices for learning by the organization and its members. For evaluation to be useful, a guiding list of issues includes: §

§ § §

The extent to which the evaluation considers the relevance of the ABGR initiatives. To what extent is the evaluation consistent with the understanding and rationale behind the goals of the ABF The extent to which the evaluation of the initiatives are coherent and objective in terms the aspirations of the members Does the evaluation involve all the key partners and stakeholders Is there a clear implementation arrangements including how the evaluation is to be conducted


§

To what extent are the products from the evaluation process identified. How useable would the findings emanating from the evaluation.

Figure 3: Depicting the Sequential Steps for Evaluation

Evaluations serve as a learning tool that generate information to be used to improve performance as well as to ensure transparency, accountability and to measure performance that emanate from the implementation of ABR initiatives. The process of performance monitoring and evaluation cycle would involve careful goal setting, indicators of what the members want see achieved, information gathering as initiatives are ABR Handbook on Business Facilitation| 68

implemented, analysis of the data and information gathered, share lessons, take measures to achieve continuous improvement and use results for organizational learning.


7

Conclusion

• • •

Conformity Standards Technological Progress Market Access


Conformity Standards The extensive range of standards and guides for conformity assessment produced jointly, under the name CASCO standards, by ISO (International Organization for Standardization) and IEC (International Electro-‐technical Commission) has been discussed, together with their ability to open opportunities for developing countries to build structures acceptable to global markets. The range had recently been comprehensively modernized and extended. In developing this range of standards independently of standards for specific products or services, ISO’s goal was to provide a set of voluntary standards representing best practice in conformity assessment, reducing the need for regulation of that activity and ensuring that where regulation was unavoidable, a uniform basis could be used internationally.

Technology New technologies offer opportunities that can be used to diversify national economies. Services, in particular those supported by new technologies, can be tapped to reduce dependence on commodities. Half of the countries in Africa derive more than 80% of their merchandise export income from commodities, and the need for new development paths to counter this dependence on commodities is especially important for least developed countries (LDCs), according to UNCTAD's 2012 Commodities and Development Report. Significant bottlenecks and challenges remain in developing countries, and particularly in Africa, where costs associated with ICT remain extremely high. As a result, the Middle East and Africa are estimated to handle a mere 1.6% of global e-‐commerce, although that is expected to grow to 3.5% by 2016

Market Access Improving access to markets is critical to achieving business growth. It is a persistent challenge for micro-‐entrepreneurs. Integration into global markets offers the potential for more rapid growth and poverty reduction. However, market barriers to some key developing country exports have made it harder for them to take full advantage of this opportunity. Access to Markets (ATM) services is becoming recognised as a critical way to support the growth of micro and small-‐scale enterprises. ATM programs are testing a wide range of marketing-‐related services with the goal of connecting entrepreneurs to additional or previously inaccessible customers, thereby increasing sales of and possibly income from the business. Often, micro-‐entrepreneurs are isolated from the market in which their product will compete. They are less likely than large firms to attend trade shows, read the relevant trade journals or engage in costly and extensive market research. Yet, a seller of dried mushrooms will have a ABR Handbook on Business Facilitation| 71

much greater chance of success if he or she regularly reads the Mushroom Growers Newsletter. A good grasp of industry trends is essential to developing a high-‐end product with a realistic and clearly identified niche on the retail shelf. Regional markets provide the potential for higher volumes of sales through fewer buyers. They also present higher hurdles for new entrants. Of these hurdles, distribution is perhaps the most difficult for micro-‐entrepreneurs to overcome.

Reference 1. African Economic Outlook, 2013, Structural Transformation and Natural Resources 2. Adenikinju, A, and O. Oyetani, 200 “Characteristics and Behavior of African Factor Market and Market Institutions and Their Consequences for Economic Growth” CID Working Paper 31, Harvard University, Centre for International Development, Cambridge, Mass. 3. 2004, “Doing Business in 2005 Sub-‐Saharan Africa: Regional Profile.” Investment Climate Department, Monitoring, Analysis and Policy Unit. Washington DC 4. UNECA, 2002, Harnessing Technologies for Development, ECA Policy Research Report 5. Tandon Yash, 2002, Evaluation of the WITO and Other Forums of Technical Assistance to Developing Countries in the Context of the Uruguay Round of Agreements. South and Eastern African Trade, Information and Initiative, Harare, Zimbabwe 6. IMF, Market Access for Developing Country Exports—Selected Issues Prepared by the Staffs of the IMF and the World Bank, Approved by Timothy Geithner and Gobind Nankani, September 26, 2002 7. ITC website. 8. It’s Time for Africa -‐ Ernst & Young 2011 9. Mutual Review of Development Effectiveness in Africa 2010 10. Lions on the Move: The Progress and Potential of African Economies 2010 – McKinsey 11. 2014 Market Access Map; Simulation: Bound Tariff, Also http//wto.org 12. OECD, 2011, Making Reform Happen in Developing Countries: Preliminary Report, 4th High Level Forum on Aid Effectiveness, 2011
