Trade Facilitation - Factor for Business Dynamism

Boskov, Tatjana (2020) Trade Facilitation - Factor for Business Dynamism. In: Globalization, Trade Liberalization and Business Dynamism. Lap Lambert Academic Publishing, Germany, pp. 49-65. ISBN 978-620-281-437-9

[thumbnail of Book Chapter  5.pdf]
Book Chapter 5.pdf

Download (1MB) | Preview


High trade costs are an obstacle in trading and have impact in the realization of
the benefits from trade liberalization. Trade profits depend not only on tariff
liberalization but also on the quality of infrastructure and related services. Improved
infrastructure and logistics services play an important role in international trade
flows. On the one hand, they generate enormous wealth by reducing the cost of trade
due to their non-discriminatory and non-competitive characteristics. On the other
hand, they integrate production and trade across the country. These aspects are
important to consider in order explaining the importance of trade facilitation, as it
enables the smooth advancement and business dynamization.
Thus, very often trade costs are cited as an important determinant of trade
volume. There is also a growing literature on concerns about the impact of trade
costs on trade volume. Most studies of this nature show that integration is a result of
reduced transport costs for individual and all infrastructure services in general. The
common goal of economic interaction is to reduce trade barriers - visible and
invisible. Direct evidence of border costs shows that tariff barriers are now low in
most countries - on average less than 5% of the average measured in rich countries,
with a few exceptions, and in developing countries at an average between 10 and
As world follows a dramatic drop in tariffs over the past two decades, many
barriers remain to "punish" trade, between existing weaker and heavier barriers. An
example of softer barriers is trade tackling and business facilitation measures. The
heavier set of barriers commonly referred to physical or infrastructural barriers, deal
with transport facilitation measures. The costs created by these barriers can be
grouped together and referred to as trade costs which are estimated as difference between the cost of exports and imports. This difference roughly shows the cost of
transporting goods from one country to another.

Item Type: Book Section
Subjects: Social Sciences > Economics and business
Divisions: Faculty of Tourism and Business Logistics
Depositing User: Tatjana Boskov
Date Deposited: 08 Feb 2021 09:12
Last Modified: 08 Feb 2021 09:12

Actions (login required)

View Item View Item