Sunday, December 18, 2005

Yes, we have bananas :: Tim Harford

Tim writes:
Imagine a dream scenario in which the trade ministers emerge from their negotiations this weekend holding hands and proclaiming an end to all agricultural protectionism. What then?

For, say, a banana picker in the Central African Republic, not a lot. The trade barriers at the borders of the rich world may have disappeared, but if our picker wants to sell his bananas abroad he first has to get them onto a ship bound for America or Europe. That takes 116 days, and an incredible 38 signatures - each one an opportunity for some official to collect a bribe. Something is rotten here, and not just the bananas.
. . .
determined growers can move bananas along even lousy roads. The real problem is elsewhere: three-quarters of delays are the result of red tape, not port handling or inland transport. These delays, caused by senseless bureaucracy, unnecessary forms and archaic inspection practices, can often be eliminated with a stroke of a pen by a country's chief executive.
. . .
Kamal Nath, has called for rich countries to "eliminate export subsidies as fast as possible." And so they should, but Mr. Nath might take note that an Indian exporter needs to collect 22 signatures on 10 documents - that puts India in the bottom 20 countries in the world for letting its own entrepreneurs trade across borders. Celso Amorim, Brazil's foreign minister, has condemned farming subsidies as "the most harmful single piece of commerce." The subsidies are indeed repugnant, but Brazilian exporters need 39 days to get their produce onto a ship, too long for some agricultural goods.

It doesn't have to be that way. China can get exports moving in 20 days, the United States in nine days. Danish exporters can ship in five days.
. . .
governments of poor countries must do far more to help their own citizens by reforming the
Byzantine obstacles that stand in their way. One day rich countries may finally allow poor farmers to sell them beef, sugar or rice. It would be a disaster if their own governments prevented those poor farmers from taking full advantage of that opportunity.

Thanks to The EclectEcon for the link. Check out his post - there's value added!

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