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From Quantity to From Quantity to Quality: Quality: AID FOR TRADE in Latin America and the AID FOR TRADE in Latin America and the Caribbean Caribbean Marcelo M. Giugale Marcelo M. Giugale Director Director Poverty Reduction and Economic Management Poverty Reduction and Economic Management THE WORLD BANK THE WORLD BANK Symposium on Aid for Trade – Kingston, Jamaica – June 16-17, 2008
21

From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

Mar 27, 2015

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Page 1: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

From Quantity to Quality:From Quantity to Quality:AID FOR TRADE in Latin America and the CaribbeanAID FOR TRADE in Latin America and the Caribbean

Marcelo M. Giugale Marcelo M. Giugale DirectorDirector

Poverty Reduction and Economic Management Poverty Reduction and Economic Management THE WORLD BANKTHE WORLD BANK

Symposium on Aid for Trade – Kingston, Jamaica – June 16-17, 2008

Page 2: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

An Agenda for “Trade Quality” in LAC:An Agenda for “Trade Quality” in LAC:

1. New Brands1. New Brands

Page 3: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

Stagnant Trade Penetration for Latin Stagnant Trade Penetration for Latin America and the Caribbean…America and the Caribbean…

Penetration of Asia & LAC in World Trade(X & M as a share of World Trade)

LAC

Asia

Caribbean (right-hand side scale)

0

2

4

6

8

10

12

14

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

0.0

0.5

1.0

1.5

2.0

Page 4: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

2. Smarter Technologies2. Smarter Technologies

An Agenda for “Trade Quality” in LAC:An Agenda for “Trade Quality” in LAC:

Page 5: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

Slow Productivity GrowthSlow Productivity Growth(annual average productivity growth, 2001-2006)(annual average productivity growth, 2001-2006)

-1.0% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0%

CRIHNDDOM

SLVMEXGTM

NICPRYLACBOLARGBRACHLCOLKORMYSPANPERCHL*

IDNIND

CHN

Source: Summers, Heston : WDI. *Chile average : 1991-2000

ALCPromedio

-1.0% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0%

CRIHNDDOM

SLVMEXGTM

NICPRYLACBOLARGBRACHLCOLKORMYSPANPERCHL*

IDNIND

CHN

Source: Summers, Heston : WDI. *Chile average : 1991-2000

LACAverage

Page 6: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

……and Little Emphasis on R&Dand Little Emphasis on R&DExpenditure in Research & Development in Selected Caribbean

Countries and Regional Groups (% of GDP)

0.0

0.5

1.0

1.5

2.0

2.5C

uba

St. L

ucia

St. V

ince

nt a

nd th

e G

rena

dine

s

Tri

nida

d an

d T

obag

o

Jam

aica

Wor

ld

Eur

o ar

ea

Eas

t Asi

a &

Pac

ific

Lat

in A

mer

ica

& C

arib

bean

Sout

h A

sia

Hig

h in

com

e

Low

er m

iddl

e in

com

e

Mid

dle

inco

me

Low

& m

iddl

e in

com

e

Upp

er m

iddl

e in

com

e

Low

inco

me

Source: WDI. Data corresponds to 2005 or latest year available.

Page 7: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

An Agenda for “Trade Quality” in LAC:An Agenda for “Trade Quality” in LAC:

3. More Jobs3. More Jobs

Page 8: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

Brain Drain in the CaribbeanBrain Drain in the Caribbean(Share of Educated Among Migrants, 2000)(Share of Educated Among Migrants, 2000)

0

10

20

30

40

50

60

70

80

90

100

Mex

ico

Cen

tral

Am

eric

a

And

ean

Sou

th A

mer

ica

Cub

a

Dom

inic

an R

ep.

Hai

ti

Jam

aica

Ant

igua

-Bar

buda

Bah

amas

Bar

bado

s

Dom

inic

a

Gre

nada

St.

Kit

ts-N

evis

St.

Luc

ia

St.

Vin

cent

Tri

nida

d &

Tob

ago

Page 9: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

While Remittances Remain Uneven…While Remittances Remain Uneven…

Caribbean and Selected Economies: Flow of Remittances, 2006 (% of GDP)

0

5

10

15

20

25

Guy

ana

Hai

ti

Jam

aica

Dom

inic

an R

epub

lic

Bel

ize

Gre

nada

Bar

bado

s

Dom

inic

a

St. V

ince

nt a

nd th

e G

rena

dine

s

Ant

igua

and

Bar

buda

St. K

itts

and

Nev

is

Tri

nida

d an

d T

obag

o

St. L

ucia

Suri

nam

e

Mid

dle

Eas

t & N

orth

Afr

ica

Sout

h A

sia

Lat

in A

mer

ica

& C

arib

bean

Sub-

Saha

ran

Afr

ica

Eas

t Asi

a &

Pac

ific

Eur

ope

& C

entr

al A

sia

Eur

o ar

ea

Page 10: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

An Agenda for “Trade Quality” in LAC:An Agenda for “Trade Quality” in LAC:

4. Better Infrastructure4. Better Infrastructure

Page 11: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

The Caribbean Lags behind Asia in LogisticsThe Caribbean Lags behind Asia in Logistics

Logistics Performance Index

1 2 3 4 5

Guyana

Haiti

Jamaica

Low income

Lower middle income

Latin America & Caribbean

Upper middle income

India

China

Korea, Rep.

Taiwan, China

High income

Source: World Bank LPI

Page 12: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

Export Costs Are Too LargeExport Costs Are Too Large

Caribbean and Selected Economies: Cost to export (US$ per container)

0

400

800

1,200

1,600

2,000

Bel

ize

St.

Vin

cent

and

the

Gre

nadi

nes

Jam

aica

Hai

ti

St.

Luc

ia

Dom

inic

a

Ant

igua

and

Bar

buda

Sur

inam

e

Guy

ana

Gre

nada

Dom

inic

an R

epub

lic

St.

Kit

ts a

nd N

evis

Tai

wan

, C

hina

Kor

ea

Tri

nida

d an

d T

obag

o

Indo

nesi

a

Tha

ilan

d

Sin

gapo

re

Chi

na

Sub

-Sah

aran

Afr

ica

Eas

tern

Eur

ope

& C

entr

al A

sia

Sou

th A

sia

Lat

in A

mer

ica

& C

arib

bean

Mid

dle

Eas

t &

Nor

th A

fric

a

OE

CD

Eas

t A

sia

& P

acif

ic

Source: Doing Business Indicators

Page 13: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

An Agenda for “Trade Quality” in LAC:An Agenda for “Trade Quality” in LAC:

5. Quicker Institutions5. Quicker Institutions

Page 14: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

Export Procedures Are SlowExport Procedures Are Slow Caribbean and Selected Economies:

Time for Export (days)

0

20

40

60

Hai

ti

Guy

ana

Suri

nam

e

Bel

ize

Jam

aica

Indo

nesi

a

Chi

na

Ant

igua

and

Bar

buda

Gre

nada

St. L

ucia

Tha

iland

Dom

inic

a

St. V

ince

nt a

nd th

e

St. K

itts

and

Nev

is

Tri

nida

d an

d T

obag

o

Tai

wan

, Chi

na

Dom

inic

an R

epub

lic

Kor

ea

Sing

apor

e

Sub-

Saha

ran

Afr

ica

Sout

h A

sia

Eas

tern

Eur

ope

& C

entr

al

Mid

dle

Eas

t & N

orth

Afr

ica

Eas

t Asi

a &

Pac

ific

Lat

in A

mer

ica

& C

arib

bean

OE

CD

Source: Doing Business Indicators.

Page 15: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

An Agenda for “Trade Quality” in LAC:An Agenda for “Trade Quality” in LAC:

6. Tailored Finance6. Tailored Finance

Page 16: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

An Agenda for “Trade Quality” in LAC:An Agenda for “Trade Quality” in LAC:

7. Smoother Transformations7. Smoother Transformations

Page 17: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

An Agenda for “Trade Quality” in LAC:An Agenda for “Trade Quality” in LAC:

8. Less Informality8. Less Informality

Page 18: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

An Agenda for “Trade Quality” in LAC:An Agenda for “Trade Quality” in LAC:

9. Greener Businesses9. Greener Businesses

Page 19: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

An Agenda for “Trade Quality” in LAC:An Agenda for “Trade Quality” in LAC:

10. Cuba: Challenge and Opportunity10. Cuba: Challenge and Opportunity

Page 20: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

An Agenda for “Trade Quality” in LAC:An Agenda for “Trade Quality” in LAC:

1.1. New BrandsNew Brands2.2. Smarter TechnologiesSmarter Technologies3.3. More JobsMore Jobs4.4. Better InfrastructureBetter Infrastructure5.5. Quicker InstitutionsQuicker Institutions6.6. Tailored FinanceTailored Finance7.7. Smoother TransformationsSmoother Transformations8.8. Less InformalityLess Informality9.9. Greener BusinessesGreener Businesses10.10. Cuba: Challenge and OpportunityCuba: Challenge and Opportunity

Page 21: From Quantity to Quality: AID FOR TRADE in Latin America and the Caribbean Marcelo M. Giugale Director Poverty Reduction and Economic Management THE WORLD.

Thank You.Thank You.