Passport to purchase, Part II
Even as the financial crisis takes its toll, it looks like the Gulf states maybe looking to reclaim their place at the center of world trade, Part II.
January 26, 2009 8:49 by Ian Munroe
With the odds stacked against the WTO, Gulf states may want to concentrate on domestic housecleaning -things they can do on their own to become more efficient trading centers, mainly by reducing the cost of sending goods through local air and seaports.
In industry speak, those measure are sometimes called trade facilitation, which includes making regulations more transparent; developing local transportation infrastructure; and generally speeding up the time that freight shipments wait to be processed by customs authorities.
“It’s not going to solve the problems of the recession,” says Paul Hiscock, head of communications at the UK based trade facilitation body SITPRO. “But the sorts of things you get with trade facilitation are perhaps going to make the difference for some companies and for some countries.”
“What you get to do is make profit margins or loss margins slightly better,” he adds. “And let’s face it, anything you can do to get rid of costs in this sort of market is good. You want to be as efficient as possible.”
With the global trade system under threat and international commerce set to drop off in the Gulf, a cost-cutting attitude may be the region’s best bet. Especially if its trade sector hopes to avoid losing ground to transshipment hubs in other parts of the world, which will be vying for slices of a smaller economic pie this year.
First seen in Trends magazine.