The Impact of Trade Facilitation Measures on Bilateral Trade Flows of Middle-Income and Central Asian Countries for the Year of 2016

Abstract

This paper observed the relationship between trade facilitation measures that are expressed through the OECD Trade Facilitation Indices and the bilateral trade flows (exports and imports) of the Middle-Income Countries (MICs) for the year of 2016. The author chose 110 MICs because CA and CIS countries fall into the category. The author used the OECD database along with the UN Comtrade (BACI) database in his Gravity model of trade flows. The author used the Heckman Maximum Likelihood estimation strategy with restrictions on common language, colony ties, and common colonizer. The findings indicate that there is a positive and significant effect between the improvement in the TFIs and the increase in trade flows. The author has combined quantitative for trade of the MICs and the qualitative research of customs efficiency of the CA countries. The qualitative research covered the time span from 2016 to 2018. The analysis shows that in order to improve the situation with the customs on the border, it is necessary to upgrade infrastructure, conduct capacity building for the staff, and reform the chain-of-command system. Detailed results can be found in the end of the thesis.