1. Introduction

The distributional impacts of international trade often generate heated debate, but the overall benefits of greater trade in supporting increases in global welfare are widely acknowledged. Historically, negotiations to expand trade have focused on removing tariffs and non-tariff measures – with considerable success. But more recent trade-widening talks, like the stalled Doha Round, have foundered.

The last 30 years have seen a large reduction in tariffs. Today, the biggest deterrents to trade are physical, administrative and informal obstructions to the movement of goods. Regulations that impinge on the smooth functioning of a product’s global supply chain interfere with trade more than traditional barriers do. New efforts to make global supply chains function more smoothly have won industry advocacy and have begun to be embraced in recent regional trade talks, like the Trans Pacific Partnership.

The World Economic Forum has been a leader in fostering this new understanding of how to broaden and deepen global trade by unshackling supply chains. Its annual Global Enabling Trade Report (GETR) identifies market access, border administration, telecommunications and transportation infrastructure, and business environment as the four main issue areas affecting supply chains before, at and after the border. This analysis also builds on more detailed data compiled by the World Bank, in particular the Doing Business reports and the Logistics Performance Index. 

Building on the insights provided by these indicators, the World Economic Forum launched the Enabling Trade: Valuing Growth Opportunities project under its Supply Chain & Transport Industry programme at its Annual Meeting 2012 in Davos-Klosters in January. Conceptualized by the Forum’s Global Agenda Councils on Trade and Logistics & Supply Chain, the project aims to improve the understanding of the policies that result in supply chain inefficiencies and to identify new approaches that can be taken to reduce supply chain barriers, including through trade negotiations and cooperation. 

This report quantifies the barriers highlighted by the Global Enabling Trade Report and describes how they actually play out on the ground through the examination of 18 case examples drawn from many industries and geographies. It attempts to answer several questions: How do companies deal with barriers? What costs do barriers impose? What impact do they have on supply chain delays? Some cases focus on a single company, others on a collection of companies or an association. 

The major lessons and recommendations drawn from these examples can be found in the body of this report. Detailed descriptions of the cases studies can be found under section 6. The authors are grateful for the cooperation of the many companies and executives who generously shared their time and perspective.