Presentation on CAREC Study: Diversifying Trade

Transcript:Presentation on CAREC Study: Diversifying Trade:
Presentation on CAREC Study: Diversifying Trade Flows and Transport and Transit Routes in CAREC Region Roman Mogilevskii Regional Cooperation and Integration Unit Central and West Asia Department Asian Development Bank National Focal Points' Meeting 18 October 2023 Introduction This work responds to the requests for analysis of the recent shocks’ impact on trade and transit in the CAREC region - change in and diversification of trade flows - current situation and alternative transit options Work in progress, final version in 2024 Preliminary version to be presented at the panel session “Diversifying Trade Flows and Transport and Transit Routes in CAREC Region” at the Ministerial Conference, 2023 Discussants at the session – development partners, private sector, governments This PPT will be updated for the MC Increase in Trade in Goods due to Energy Prices… In 2022, many economies of the region have recorded all-time high values of merchandise and service exports and imports The growth mostly continues in 2023 Dramatic increase in energy trade driven by growth in international prices (64% increase in 2022) followed by 40% decline in 2023 …and exports to the Russian Federation Major increase in exports to and imports (mostly energy) from Russia Growth in exports due to voluntary departure of international companies from the Russian market and sanctions – emergence of associated market opportunities, especially for CCA economies Declining imports of machinery and equipment from Russia Components of export growth Export creation, export destruction and re-exports to Russia Main beneficiaries – Kazakhstan, Kyrgyz Republic and Uzbekistan Export creation in traditional (re)export sectors, but also in relatively new ones, e.g., cars from Kazakhstan Export destruction driven by sanctions on Russian counterparts Re-exports Re-exports to Russia are very big and increasing, both reported and implicit The same main actors Key re-exported products – machinery and equipment, textiles Re-exports, not export creation, dominate in the response to the market opportunity – the growth of exports is limited by supply, not demand Transit routes revisited The conflict and sanctions created multiple risks for CCA transit routes via Russia Two types of transit: (i) from PRC to Europe and (ii) from Central Asia to Europe and elsewhere The former type of transit has a robust alternative (sea shipments are back to normal after the COVID-19 pandemic); the latter type of transit has fewer alternatives Middle Corridor development as a possible response Challenges for Middle Corridor: infrastructure, logistics, climate change ADB study