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Non-Tariff Barriers Facing Lao Exporters. NTM Workshop, World Bank 4-5 May 2006, Krabi, Thailand. Background. Necessary to bear in mind the characteristics of Laos as a landlocked country.

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Non tariff barriers facing lao exporters

Non-Tariff Barriers Facing Lao Exporters

NTM Workshop, World Bank

4-5 May 2006, Krabi, Thailand


Background
Background

  • Necessary to bear in mind the characteristics of Laos as a landlocked country.

  • Dealt not only of NTBs imposed by trading country partners but also of mechanisms within Laos or the lack of these that limit exporters.


Lao export profile
Lao Export Profile

  • In the 1990’s, export growth was around 15% per year;

  • In first 6 months of 2004, this increased by 22%

  • Mainly driven by garments, electricity, mining and coffee.


Composition of lao export goods
Composition of Lao Export Goods

  • Highly concentrated to 3 product categories:

  • Wood and wood products

  • Garments

  • Coffee


Cont:

  • These products account for 96% of total exports of merchandise goods (electricity not included).

  • Almost 80% of exports are directed to EU and Thailand.


Cont:

  • Insufficiently exploited export potential include:

  • Secondary wood processing products;

  • Knitted garments;

  • footwear;

  • Livestock-based products; and

  • Light manufacturing


Major export product categories
Major Export Product Categories

  • GARMENT

  • Accounts for 25% (equal to electricity) of the total exports;

  • EU is the biggest recipient country/region, 88% in 2000 and increased to 91% in 2003.


Cont:

  • WOOD AND WOOD PRODUCTS

  • From 2001-2003, this accounted for 17% of the total exports

  • Main destinations were Thailand (76%),

    Japan (14%), China (12%) and Taiwan (3%)


Cont:

  • COFFEE

  • From 2001-2003, coffee products accounted for 3% of the total exports.

  • Since 1995, EU has emerged as the dominating recipient country accounting for 50-60% of the Lao coffee exports.


Other export products
Other export products

  • TEXTILE HANDICRAFTS

  • Estimated total export value as a whole was approximately 12 M dollars in 2002-2003.

  • Though having the benefits of GSP, destinations are mainly to EU countries, Singapore, Japan, and USA. Informal border trade to Thailand occurs.


Cont:

  • OTHER AGRICULTURAL PRODUCTS AND NON-TIMBER FOREST PRODUCTS (NTFPs)

  • These include commercialized products such as cardamom, broom grass, sticklac, mulberry and resin

  • Industrial crops such as: soybeans, job tears, sesame seeds, ground nuts.


Cont:

  • Trading partners are neighboring countries like Thailand, Vietnam and China using border trades with a few cases of exports to EU like France.

  • Data indicates quite fluctuated export figures: 6.6 USD in 2000-01, 8.2 USD in 2001-02 and 5.7 USD in 2002-03.


Main products affected by ntms
Main Products affected by NTMs

  • Internal restrictions:

  • Wood (timber, natural wood)

  • External barriers:

  • Garments (textile, cloth materials)

  • Handicrafts (silk woven products)


Types of ntms
Types of NTMs

  • Internal measures that affect export:

  • Unclear and changing regulations and procedures.

  • Restrictive practices: Administrative procedures where too many steps and paper works are required to get ones’ products approved


Cont:

  • Irregular amounts that have to be paid.

  • Extra expenses paid (“to make the process faster”) which cannot be declared as there are no receipts issued for these.

  • Customs valuation in which charges are not standard or the same.


Cont:

  • External Measures

  • Most prohibitive were transport costs due to monopoly in Thailand

  • Third country transit costs and paper works on Thai side

  • Customs services and procedures both in Thailand and in Lao side


Cont:

  • Pre-shipment inspection: Double checking that cause delay and extra charges both on the Lao and Thai side

  • Technical barriers; technical regulations and standards.


Cont:

  • Strict requirements set and additional costs to testing in other countries.

  • Lack of laboratories in Laos for testing that can be accepted internationally.


Countries most constraining
Countries Most Constraining

  • Thailand

  • EU

  • Japan

  • Laos


SABAIDEE,

KOP CHAI LAI LAI





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