Most countries in Central Asia face high trade costs due to their lack of territorial access to the sea, remoteness and isolation from world markets and high transit costs. Reducing trade costs and shortening transit time is a fundamental step towards integrating these countries into the global market. While it is well recognized that transport and logistics infrastructure play key roles in this regard, there is a growing consensus that trade facilitation is also crucial to reducing trade costs through streamlining of the trade process.
Moving goods across borders necessitates meeting a vast number of commercial, transport, and regulatory requirements, which typically entail complex procedures and, often, many documents. While most actors and regulators along the international supply chain are aware of the need to streamline import and export procedures, few, if any, have a complete understanding of the entire trade transaction process. This makes it difficult to identify the bottlenecks and prioritize reforms.
Business Process Analysis (BPA) of Trade Procedures, developed under UNNExT is employed to analyse the following trade processes of specific products in Central Asia: a) Imports of processed fruits by Kyrgyzstan from Kazakhstan; b) Exports of cereal products from Kazakhstan to Azerbaijan; and c) Imports of fabric by Kyrgyzstan from China.
Corresponding to the common bottlenecks identified in each of the studies, a series of common recommendations for improving each process were also identified. First, the countries studied need to work towards harmonization of regulations and standards among themselves, in particular recognition of common documents between multiple countries or government agencies. Second, technological improvements, such as the development of trade-related software and use of paperless technologies should be embraced by the countries. Finally, the countries also need to eliminate duplicative and redundant processes and pool other together to be performed in one location, including through further development of national single windows.
This report concludes that, in the long term, each of the countries studied needs to be in the driving seat for monitoring trade facilitation performance. As a fundamental step, every country needs to establish a continuous, affordable and sustainable monitoring mechanism. In this regard, the countries may take advantage of the existing work carried out by ESCAP and ADB on a sustainable and integrated approach to monitoring trade facilitation.