The World Trade Organization (WTO) has emphasised the significant role that increased global trade has played in fostering economic integration and reducing poverty over the past thirty years.
However, the organization has expressed concern over the limited involvement of low- and middle-income economies in this growth, particularly in regions such as Africa, Latin America, and the Middle East.
In a recent report, the WTO identified several key barriers that hinder trade in these regions.
High tariffs, both domestically and internationally, continued to obstruct the flow of goods, the report had found.
While some progress has been made in reducing tariffs, many developing countries still face substantial trade costs, which can add between 75% and over 150% to the price of goods traded within the Middle East and North Africa (MENA) region.
Moreover, the report highlighted that low regional integration worsened these challenges.
In Africa, for example, complex customs procedures and excessive administrative requirements cause significant delays, with border-crossing times stretching up to 36 hours in some areas.
This inefficiency can result in losses that exceed tariff costs, amounting to an estimated $48 million annually for southern Africa alone.
The WTO also noted that inadequate physical and digital infrastructure, along with geographical remoteness, further complicated trade efforts.
Many countries in Latin America struggle with outdated port facilities and insufficient logistics capabilities, limiting their participation in global supply chains.
Similarly, in the MENA region, high trade costs and low logistics performance continue to stifle competitiveness, with tariff peaks and non-tariff barriers discouraging export activities.
The organization’s findings underscore the urgent need for comprehensive reforms aimed at improving trade facilitation, enhancing infrastructure, and reducing bureaucratic obstacles.
Such measures are essential not only for increasing trade but also for promoting sustainable economic growth and development in low- and middle-income economies.
