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How Much Will the Belt and Road Initiative Reduce Trade Costs? / de Soyres, Francois.
World Bank Open Knowledge Repository (formerly "World Bank E-Library Publications") Available online
View online- Format:
- Book
- Government document
- Author/Creator:
- de Soyres, Francois.
- Series:
- Policy research working papers.
- World Bank e-Library.
- Language:
- English
- Subjects (All):
- GIS Analysis.
- International Economics & Trade.
- International Trade And Trade Rules.
- Ports & Waterways.
- Shipment Times.
- Trade And Services.
- Trade Costs.
- Transport.
- Transport Infrastructure.
- Local Subjects:
- GIS Analysis.
- International Economics & Trade.
- International Trade And Trade Rules.
- Ports & Waterways.
- Shipment Times.
- Trade And Services.
- Trade Costs.
- Transport.
- Transport Infrastructure.
- Physical Description:
- 1 online resource (43 pages)
- Place of Publication:
- Washington, D.C. : The World Bank, 2018.
- System Details:
- data file
- Summary:
- This paper studies the impact of transport infrastructure projects of the Belt and Road Initiative on shipment times and trade costs. Based on a new data on completed and planned Belt and Road transport projects, Geographic Information System analysis is used to estimate shipment times before and after the Belt and Road Initiative. Two sets of data are computed to address different research questions: a global database based on an analysis of 1,000 cities in 191 countries and 47 sectors and a regional database that focuses on more granular information (1,818 cities) for Belt and Road economies only. The paper uses sectoral estimates of "value of time" to transform changes in shipment times into changes in ad valorem trade costs at the country-sector level. The findings show that the Belt and Road Initiative will significantly reduce shipment times and trade costs. For the world, the average reduction in shipment time will range between 1.2 and 2.5 percent, leading to reduction of aggregate trade costs between 1.1 and 2.2 percent. For Belt and Road economies, the change in shipment times and trade costs will range between 1.7 and 3.2 percent and 1.5 and 2.8 percent, respectively. Belt and Road economies located along the corridors where projects are built experience the largest gains. Shipment times along these corridors decline by up to 11.9 percent and trade costs by up to 10.2 percent. The paper also shows that these effects are magnified by policy reforms that reduce border delays and improve corridor management.
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