How digital commerce can cope with soaring global shipping costs
As international shipping costs reach all-time high due to COVID-19 pandemic, digital trade facilitation can help ‘turn the tide’, Asian Development Bank and Commission study finds United Nations Economic and Social Policy for Asia and the Pacific. noted.
The Asia-Pacific Trade Facilitation Report 2021 stated that “the costs of doing business in Asia and the Pacific are highest in South Asia. Central Asia and the Pacific have made progress in reducing trade costs in recent years, but they remain high. “
While the most developed countries in East Asia have the lowest trade costs in the region, followed by the Association of Southeast Asian Nations (ASEAN), the report said.
The study also showed that trade facilitation agreements between Asia-Pacific economies can benefit from the transition to digitalization of trade.
The report cites a World Trade Organization (WTO) simulation that implementing fully digital trade facilitation can help reduce average trade costs in the region by more than 13%.
Rupa Chanda, director of trade, investment and innovation at ESCAP, said they also expect global trade to continue to improve once COVID-19 cases continue. decrease across the world with increasing immunization rates.
She said this should improve the macroeconomic outlook for next year and help boost global and regional trade, both of which are closely linked to economic conditions.
“However, there will be differences in the region due to the pace of the pandemic’s progress and the pace of vaccination,” Chanda explained.
“There have obviously been long-term efforts to open up trade, improve liberalization measures, trade facilitation measures, but the pandemic has been sort of a wake-up call for the need to speed up some of the issues. ‘between them,’ she said.
She also underscored the need for greater commitment to market liberalization among jurisdictions in the Asia-Pacific region.
“We have seen the disruption that can be caused by export restrictions, bans and all kinds of very one-off policies that have an effect on other countries,” Chanda noted.
She said they expected the pandemic to further decentralize the regional supply chain with more manufacturing and investment centers set up outside traditional sites in Asia.
Source: ABS-CBN News