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39th IATTO FORUM – EXPORT SUMMIT II INSPIRING TRADE GLOBALLY Margaritis Schinas Director, Head of DG ECFIN Athens Office 25/09/2013 1 Reinventing Growth through Exports and Trade Facilitation: • Pushing the Reset Button 25/09/2013 2 A. The big picture: recent trends in international trade policy and lessons to be drawn 1. More openness in international trade but certain critical barriers still remain 2. bilateralism and regional free trade agreements may bring easily attainable outcomes, multilateralism of trade liberalization produces greater benefits; clear shift to bilateralism 25/09/2013 3 A. The big picture: recent trends in international trade policy and lessons to be drawn 3. Non-tariff barriers increase when tariffs decrease; used to make up for now lower tariffs 4. Proliferation of preferential trade agreements (more than 400, all WTO Members have at least one) created a "spaghetti bowl"; 25/09/2013 4 4. Proliferation of preferential trade agreements (more than 400, all WTO Members have at least one) created a "spaghetti bowl"; 25/09/2013 5 A. The big picture: recent trends in international trade policy and lessons to be drawn 5. Relationship between trade liberalization and poverty eradication : room for optimism, but ultimate outcome is multi-factor 6. Key for growth : reform and complementary policies (ie opening trade in services, investment liberalization, competition policy) ; pace matters 25/09/2013 6 B. The case of Greece : regaining competitiveness, restoring inclusive export growth ; the time is now ! 1. Greece is quickly regaining cost competitiveness after the significant losses in the past decade (i.e. ULC +21,1% compared to Euro area average in 1995 – 2010) 2. By 2014, Greece is projected to have regained its competitiveness position relative to the Euro area. 25/09/2013 7 B. The case of Greece : regaining competitiveness, restoring inclusive export growth ; the time is now ! 3. On the back of these cost competitiveness gains, export growth has started to pick up (current account deficit from +18% - 2008 to -4% 2012) from a low base (GR exports of goods and services 27% of GDP, compared to EU's 45% 2012). 25/09/2013 8 B. The case of Greece : regaining competitiveness, restoring inclusive export growth ; the time is now ! 4. Government has made improving export performance a key policy priority. Untapped potential: 25/09/2013 Unique geographical position Educated youth Motivated entrepreneurs Quality raw material Specific know-low 9 B. The case of Greece : regaining competitiveness, restoring inclusive export growth ; the time is now ! 5. Export performance will also depend on addressing other structural, non-cost impediments : a. Boosting scale of production (200 companies represent 80% of the total export value) b. Poor track-record of attracting foreign direct investment (FDI) – some success stories but more efforts needed – link to privatisation c. Cutting down on high administrative burden and simplifying procedures could lead to +1,7% GDP and create 80.000 jobs d. Active promotion of GR exports abroad - the quest for a common strategy 25/09/2013 10 Providing technical assistance: • to do what, how, when and at what cost ? National export Plan (2011) Detailed Action Plans Exports facilitation (2012) Exports promotion (2013) From diagnosis to action 25/09/2013 11 Strategy and tactics: WHO DOES WHAT • EU and international organisations Opening of markets / Commitment to support & advice / best practice • Gr Government Champion the cause of business Simplify national requirements for GR traders Suppress supporting documents in customs for every single export clearance Electronic and cash-free environment in customs offices Actively promote exports (reorganisation of export agencies, economic diplomacy) 25/09/2013 12 Strategy and tactics: WHO DOES WHAT • Associations and business Overcome sectorial / geographical differences Concentrate resources and lobbying capacities 25/09/2013 13 Strategy and tactics • A story to remember 25/09/2013 14