BSEC Bubble Chart 2007

Trade restrictions. Untangling WTO tariff statistics – Albania

My current research is focused on recent achievements in the state of trade and economic cooperation among a number of 13 countries in the Black Sea Region. Most of these countries have been enjoying independence for more then 18 years, which gave their governments (I insist) just about enough time to take advantage of the international division of labor by opening their markets (free the circulation of goods, services, labor, persons, enterprises, property rights in and out their territories, across jurisdictions)  to the global economy and implicitly to their neighboring economies. In my endeavor, I marched with a very simple (optimistic) question: ” Given there was some progress toward economic integration at the Black Sea in the last two decades, what is left to improve in terms of trade? More simply: What are the remaining barriers to trade in this region?” .

How hard can it be to find a clear answer to this? I imagined not that hard; for goods trade, for instance, I’ll just have to check with the WTO folks website… And so I did and,

I took Albania first and searched for its trade (tariff) barriers on wto.org:

-> Albania in the WTO -> Goods schedules and tariff data-> Albania Tariff Profile 2008 -> SUCCESS! -> this final summary of which the excerpt below basically says (correct me if I am wrong) that add-valorem tarrifs on imports of specified agricultural products do not go past 20% in the case of duties “bounded ” by the negotiations within the WTO setting, and not more then 15% in case of MFN (Most Favored Nation clause, non-discriminatory duties) agreements. The tariff range goes from 0% (duty-free) on a totally insignificant percentage of animal (0.1 ) and cereal (1.9) products imported into Albania, to 20%.

So far, it seems that imports under MFN agreements, unlike the rest, are a “privileged” category of products with lower maximum and average duties to be paid at Albanian customs. In reality, the numbers do not tell us much about the volume of transactions, do they? For instance, does it matter to know the simple average of all levels of customs duties applied on dairy products by Albania? For statistical records, maybe, but for economic interpretation, very little.

What would have been important to know in evaluating how restrictions on foreign dairy products on Albania’s market is not the simple, but the weighted average of import duties for each agricultural category. I could not find such information in WTO reports posted online.

Sure, I can find the trade flows data myself and then compute the averages, but then what is their role? Shouldn’t WTO issue (especially) qualitative reports that would make at least the average person understand the meaning of tariffs and why negotiations for tariff reductions is desirable for each country’s economic progress?

And I am not asking this because I am lazy to do that myself , I can do it! It’s just common sense. At some point, these giant organizations tend to loose the initial purpose of their whole existence…