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Connecting Landlocked Developing Countries to Markets
In South America, despite the soundness of the legal framework contained in ATIT (Acuerdo sobre Transporte International Terrestre, or Agreement on International Land Transportation) and transit trade growth in the Mercado Común del Sur (Mercosur) countries, the spirit of the rules is not fully reflected in procedures. ATIT, created in the early 1980s, remains a chain of national procedures. Among the Andean countries, integration is significantly lower than in Mercosur, even though a common transit declaration form is in use (also known as the Andean Manifest). East Asia has several agreements such as the Greater Mekong Subregion Agreement for Facilitation of Cross-Border Transport of Goods and People, which has similarities with the TIR, but is not implemented so far. South Asia is the region furthest away from an integrated transit regime. It is characterized by complex institutional processes and numerous documents. Transit to the LLDCs is organized only bilaterally. The complexity of the system encourages rent-seeking agents and vested interests to maintain the status quo, including labor-intensive solutions such as transloading at borders. Infrastructure issues and lack of equipment at trans-shipment points contribute to the inefficiency of the transit systems. The establishment of the South Asian Free Trade Agreement has created high expectations toward facilitating transit transport of the two landlocked countries in the region, Bhutan and Nepal. The Economic Cooperation Organization (ECO) Transit Framework Agreement involves countries in Western and Central Asia: Afghanistan, Azerbaijan, Iran, Kazakhstan, Kyrgyz Republic, Pakistan, Tajikistan, Turkey, Turkmenistan, and Uzbekistan. However, TIR is still the main instrument for long-distance transit, and ECO has not implemented its own regime. The same is true with the Arab Manifest promoted by the Arab League: the few member countries active in transit trade (Jordan, Morocco, Syria, and Tunisia) prefer to use national procedures or the TIR.
Regional Transit Regimes: “TIR Lite” There is no business case to be made for regional “TIR lite” transit regimes. None of the regional experiments launched over the past three decades have produced a truly regional system, where goods can move on transit from origin to destination under a single transit document and a single bond. In most cases, a satisfactory degree of harmonization of documentation and procedures has been achieved within a regional economic grouping but these remain purely national. No serious effort has been made to integrate the transit bonds.