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Where to Spend the Next Million? Approaches to Addressing Constraints Faced by Developing Countries As They Seek to Benefit from the Gains from Trade

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Where to Spend the Next Million? Approaches to Addressing Constraints Faced by Developing Countries As They Seek to Benefit from the Gains from Trade a “A welcome trend is emerging towards more clinical and thoughtful to Spend the Next Million? Where approaches to addressing constraints faced by developing countries as they seek to benefit from the gains from trade. But this evolving approach brings Where to Spend the Next with it formidable analytical challenges that we have yet to surmount. We need to know more about available options for evaluating Aid for Trade, Million? which interventions yield the highest returns, and whether experiences in one development area can be transplanted to another. These are some of the issues addressed in this excellent volume.” Applying Impact Evaluation to Pascal Lamy, Director-General, World Trade Organization Trade Assistance “Five years into the Aid for Trade project, we still need to learn much more about what works and what does not. Our initiatives offer excellent opportunities to evaluate impacts rigorously. That is the way to better connect aid to results. The collection of essays in this well-timed volume shows that the new approaches to evaluation that we are applying to Assistance Applyng Impact Evaluation to Trade education, poverty, or health programs can also be used to assess the results of policies to promote or assist trade. This book offers a valuable contribution to the drive to ensure value for aid money.” Robert Zoellick, President, The World Bank a THE WORLD BANK ISBN 978-1-907142-39-0 edited by Olivier Cadot, Ana M. Fernandes, Julien Gourdon and Aaditya Mattoo a THE WORLD BANK 9 781907 142390 WHERE TO SPEND THE NEXT MILLION? Where to Spend the Next Million? Applying Impact Evaluation to Trade Assistance Copyright © 2011 by The International Bank for Reconstruction and Development/The World Bank 1818 H Street, NW, Washington, DC 20433, USA ISBN: 978-1-907142-39-0 All rights reserved The findings, interpretations, and conclusions expressed herein are those of the author(s) and do not necessarily reflect the views of the Executive Directors of the International Bank for Reconstruction and Development/The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Rights and Permissions The material in this publication is copyrighted. Copying and/or transmitting portions or all of this work without permission may be a violation of applicable law. The International Bank for Reconstruction and Development/The World Bank encourages dissemination of its work and will normally grant permission to reproduce portions of the work promptly. For permission to photocopy or reprint any part of this work, please send a request with complete information to the Copyright Clearance Center Inc., 222 Rosewood Drive, Danvers, MA 01923, USA; telephone: 978-750-8400; fax: 978-750-4470; Internet: www.copyright.com. All other queries on rights and licenses, including subsidiary rights, should be addressed to the Office of the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2422; e-mail: [email protected]. Copyedited and typeset by T&T Productions Ltd, London Published in association with the London Publishing Partnership www.londonpublishingpartnership.co.uk The cover image is a painting titled Helping hand by Chidi Okoye (www.chidi.com) Reproduced with permission Centre for Economic Policy Research The Centre for Economic Policy Research is a network of over 700 Research Fellows and Affiliates, based primarily in European universities. The Centre coordinates the research activities of its Fellows and Affiliates and communi- cates the results to the public and private sectors. CEPR is an entrepreneur, developing research initiatives with the producers, consumers and sponsors of research. Established in 1983, CEPR is a European economics research orga- nization with uniquely wide-ranging scope and activities. The Centre is pluralist and non-partisan, bringing economic research to bear on the analysis of medium- and long-run policy questions. CEPR research may include views on policy, but the Executive Committee of the Centre does not give prior review to its publications, and the Centre takes no institutional pol- icy positions. The opinions expressed in this report are those of the authors and not those of the Centre for Economic Policy Research. CEPR is a registered charity (No. 287287) and a company limited by guarantee and registered in England (No. 1727026). Chair of the Board Guillermo de la Dehesa President Richard Portes Chief Executive Officer Stephen Yeo Research Director Mathias Dewatripont Policy Director Richard Baldwin The World Bank The World Bank Group is a major source of financial and technical assis- tance to developing countries around the world, providing low-interest loans, interest-free credits and grants for investments and projects in areas such as education, health, public administration, infrastructure, trade, financial and private sector development, agriculture, and environmental and natural resource management. Established in 1944 and headquartered in Washing- ton, DC, the Group has over 100 offices worldwide. The World Bank’s mission is to fight poverty with passion and professionalism for lasting results and to help people help themselves and their environment by providing resources, sharing knowledge, building capacity and forging partnerships in the public and private sectors. Where to Spend the Next Million? Applying Impact Evaluation to Trade Assistance edited by OLIVIER CADOT, ANA M. FERNANDES, JULIEN GOURDON AND AADITYA MATTOO Contents List of Figures x List of Tables xi Foreword xiii Acknowledgements xv 1. Impact Evaluation of Trade Assistance: Paving the Way 1 Olivier Cadot, Ana M. Fernandes, Julien Gourdon and Aaditya Mattoo 2. Assessing the Impact of Trade Promotion in Latin America 39 Christian Volpe Martincus 3. Can Matching Grants Promote Exports? Evidence from Tunisia’s FAMEX II Programme 81 Julien Gourdon, Jean Michel Marchat, Siddharth Sharma and Tara Vishwanath 4. The Use of Experimental Designs in the Evaluation of Trade-Facilitation Programmes: An Example from Egypt 107 David Atkin and Amit Khandelwal 5. Transport Costs and Firm Behaviour: Evidence from Mozambique and South Africa 123 Sandra Sequeira 6. Half-Baked Interventions: Staggered Pre-Shipment Inspections in the Philippines and Colombia 163 Mohini Datt and Dean Yang 7. Reforming Customs by Measuring Performance: A Cameroon Case Study 183 Thomas Cantens, Gaël Raballand, Samson Bilangna and Marcellin Djeuwo viii Where to Spend the Next Million? 8. Aid for Trade and Export Performance: The Case of Aid in Services 207 Esteban Ferro, Alberto Portugal-Pérez and John S. Wilson List of Figures 1.1 Tariffs and GDP per capita. 5 1.2 World Bank aid-for-trade commitments 2002–10. 6 1.3 World Bank Group trade portfolio 2008. 7 1.4 Evaluation of World Bank trade-related projects 1995–2005. 15 1.5 From inputs to impact. 16 2.1 Peru: Average export assistance effect on assisted firms. 54 2.2 Costa Rica: average export assistance effect on assisted firms by type of products. 55 2.3 Uruguay: export assistance effect on the probability of entering new country and product markets. 56 2.4 Chile: assistance effect on assisted firms by export outcome deciles. 57 2.5 Chile: distribution of exports over significance groups and deciles defined in terms of export growth. 58 2.6 Argentina: average assistance effect on assisted firms by size category. 59 2.7 Colombia: average effect of export assistance programmes on assisted firms relative to non-participation. 60 2.8 Colombia: average effect of export assistance programmes on assisted firms relative to each other. (a) Total exports; (b) number of products; (c) number of countries. (d) Average exports per product and country; (e) average exports per product; (f) average exports per country. 61 3.1 Average annual growth rate over 2004–8. 92 3.2 Distribution of propensity score for FAMEX (treated) firms and control (untreated) firms. 93 3.3 Impact of FAMEX on average annual growth rates over 2004–8 (in per cent). 95 5.1 Firms surveyed in South Africa and the choice of transport corridor between Maputo and Durban. 129 5.2 Transport corridors in southern (Maputo), central (Beira) and northern (Nacala) Mozambique. 130 5.3 Traffic volumes going through the Maputo Railway. 131 x Where to Spend the Next Million? 5.4 Surveyed firms in South Africa. 131 5.5 Nearest port through the railway network for surveyed firms. 132 5.6 Traffic volumes reaching the port of Maputo via rail in 2009. 133 5.7 Propensity scores for treated firms (Maputo region) and untreated firms (from Beira and Nacala) in Mozambique. 134 5.8 Propensity scores for treated firms (Gauteng and Mpumalanga regions) and untreated firms (from Western Cape and KwaZulu Natal) in South Africa. 134 5.9 Covariate balance for treated and untreated firms in Mozambique. 135 5.10 Covariate balance for treated and untreated firms in South Africa. 136 5.11 Covariate balance for treated and untreated firms in South Africa, using KwaZulu Natal as the primary comparison group. 136 5.12 Covariate balance for treated and untreated firms in South Africa, using the Western Cape as the primary comparison group. 137 5.13 Traffic volumes going through the Maputo port. 138 5.14 Trade costs and the capacity for a country to control corruption. (a) Cost of imports (US dollars) (top) and days to import (bottom). (b) Cost of imports (US dollars) SSA (top) and days to import (bottom). 141 5.15 Road network in South Africa. 151 5.16 Non-parametric regression of the probability of choosing the port of Maputo relative to the transport cost of reaching the alternative port of Durban.
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