World Bank sees big gains from easing trade flows

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WASHINGTON, Nov 6 (Reuters) Reducing the cost of moving goods across borders could boost the incomes of developing countries more than a new world trade pact that cuts tariffs and agricultural subsidies, World Bank officials said .

''The bottom line is logistics can make you or break you as a country in today's globalized and just-in-time world,'' Uri Dadush, World Bank trade director, said yesterday at a briefing to discuss the bank's first survey of how efficiently countries move goods.

World Bank researchers asked more than 800 logistics professionals to assess the performance of 150 countries in areas such as custom procedures, quality of infrastructure, ability to track and trace shipments and delivery timelines.

Singapore, a global transport and logistics hub, ranked first on the list with a score of 4.19 out of a possible 5. It was followed by Germany, Sweden, Austria and Japan. The United States ranked 14th and China came in at 30th, while Brazil was 61st and Russia 99th.

Many landlocked low-income countries in Africa and Central Asia were at the bottom end of the scale.

Afghanistan was 150th with a score of 1.21. Others in the bottom 50 with scores below 2.38 were Rwanda, Myanmar, Tajikistan, Sierra Leone, Niger, Chad, Algeria, Kazakhstan, Zimbabwe, Mali, Lesotho, Bolivia, Ivory Coast and Senegal.

The study showed a country's supply chain is only as strong as its weakest link, said Danny Leipziger, World Bank vice president for poverty reduction and economic management.

''If you have good roads and a good port, but lousy customs -- that's what people will look at'' because the less reliable the supply chain, the greater its cost, he said.

For the past six years, world trade negotiators have been trying to reach an agreement on reducing tariffs and farm subsidies that the World Bank estimates could yield billion in higher global income and other economic benefits.

Reaching a deal in the Doha round of world trade talks remains important, but research suggests that eliminating logistics snags would do more to help developing countries than cutting tariffs and subsidies, said Dadush.

''Whatever your number is for Doha, you may want to multiply it a few times, according to the research we have available, to compute the effects of getting better logistics,'' he said.

REUTERS MP AS0528

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