Trade Facilitation in Ethiopia: The Role of WTO Accession in Domestic Reform 147
agenda.5 As Grainger notes; “over the last few decades customs tariffs have
been significantly reduced. […] Consequently, the gap between tariff duties and
transaction costs has narrowed; … in view of such low trade tariffs, the
transaction cost associated with paying duties is actually higher than the duties
Experience shows that trade facilitation is highly dependent on infrastructural
developments.7 However, trade facilitation is not only about the physical
infrastructure for trade.8 Studies indicate now that, “only about a quarter of the
[trade] delays is due to poor road or port infrastructure.”9 “Seventy five percent
is due to administrative hurdles - numerous customs procedures, tax procedures,
clearances and cargo inspections - often before the containers reach the port.” 10
Accordingly, while undertaking the necessary infrastructural changes to
implement deep trade facilitation is still important, most other measures seem to
depend on strong political will.11 Development of this political will requires a
clear understanding of the needs and benefits of trade facilitation in an
This seems to be one part of the trade facilitation challenges in Ethiopia
which suffers from excessive border bottlenecks, lack of reform and drawbacks
in private investment.12 This has affected Ethiopia’s international trade relation
5 Andrew Grainger (2008), “Customs and Trade Facilitation: From Concepts to
Implementation”, World Customs Journal, Volume 2, Number 1, p. 17.
6 Andrew Grainger (2007) “Trade Facilitation: A Review”, Working Paper:
<www.tradefacilitation.co.uk> , p10 (Last accessed April 2014).
7 Jean-Paul Rodrigue (2013), Transportation, Globalization and International Trade,
chapter 5 <http://people.hofstra.edu/geotrans/eng/ch5en/conc5en/ch5c2en.html>, (last
accessed April 2014) Also see UNDP, Global Event of Landlocked Developing
Countries And Transit Countries On Trade And Trade Facilitation, Trade, Trade
Facilitation and Transit Transport Issues For Landlocked Developing Countries,
8 Gary Clyde Hufbauer (2012), Trade facilitation matters!, 14 September 2012.
<http://www.voxeu.org/article/trade-facilitation-matters> (last accessed April 2014).
9 Simeon Djankov et al. (2006), “Trading on Time”, World Bank Policy Research
Working Paper 3909, p. 9.
11 Dan Ciuriak (2010), “Supply And Demand Side Constraints As Barriers For
Ethiopian Exports – Policy Options”, Bkp Development Research & Consulting,
Trade and development discussion paper no. 02/2010 , p. 12.
12 A report for instance states in this regard, “Customs administration and administrative
entry barriers appear to be the major NTB affecting Ethiopia’s trade with COMESA
member states. The NTBs reported within this area with the greatest frequency
include import licensing, customs valuation and formalities, and to a lesser extent,