Linking Landlocked Countries to Global...

SPECIAL EDITION

UN OFFICE OF THE HIGHREPRESENTATIVE FOR THE LEAST DEVELOPEDCOUNTRIES, LANDLOCKEDDEVELOPING COUNTRIESAND SMALL ISLANDDEVELOPING STATES

Linking Landlocked Countriesto Global Opportunities

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Contents SPECIAL EDITION

Special featureUnlocking the Potential ofLandlocked DevelopingCountries

THE COMMITMENT is edited and published by Nosh Nalavala atthe United Nations in cooperation with the United Nations Officeof the High Representative for Least Developed Countries,Landlocked Developing Countries and Small Island DevelopingStates. He is the International Bureau Chief of MediaGlobal, anon-profit media agency, based in the United Nations, dedicatedto creating awareness on issues of poverty, disease, hunger andthe impact of climate change on least developed and smallisland developing countries.

For information, contact Nosh Nalavala at:

UNITED NATIONSUN Secretariat, S - 330New York, NY 10017

EditorNosh Nalavala

Managing EditorRicardo Z. Dunn

Editorial AssistantPriscilla Masilamani

CoordinatorLouise Stoddard

ContributorsAleksi Tzatzev

Anta Diallo

Cover PhotoFatima Villasboa Maidana

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5 Interview with Austrian Foreign Minister H.E. Sebastian KurzRicardo Z. Dunn interviews Austrian Foreign Minister Sebastian Kurz.

9 Advocating New Initiatives for the Vienna Programme of ActionIn an interview with THE COMMITMENT’s Nosh Nalavala, the PermanentRepresentative of Kazakhstan to the UN, Ambassador KairatAbdrakhmanov outlines new initiatives towards LLDC success.

18 Private Sector Key to Accelerated DevelopmentRicardo Z. Dunn interviews Dr. Christoph Leitl, President of theAustrian Federal Economic Chamber.

609.529.6129 [email protected]

Interviews

Also in this issue

P. Casier, CGIAR, Flickr

7 Opening Up Trade Corridors for Landlocked Southern AfricanCountries

11 Using the Coca-Cola Model to Build Value Chains for Medicine

13 Bordered By Borders Photo Call

19 Geography Accelerates the Effects of Climate Change onLandlocked Developing Countries

22 Fact Sheet: International Trade and Trade Facilitation

23 Regional Reviews

27 Zambia – A Case Study

30 The Second UN Conference on LLDCs: Two Years in the Planning

33 Book Review: The Vulnerability of Landlocked DevelopingCountries to External Shocks

34 The Development Economics of Landlockedness

35 Nurturing Business Growth in Niger

37 Website for Second United Nations Conference on LandlockedDeveloping Countries

38 Fact Sheet: Landlocked Developing Countries

39 Fact Sheet: Development Assistance and Financial Flows to LLDCs

40 A Song from the Central African Republic

A farmer harvests

maize in Mali.

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Under Secretary-General Gyan Chandra Acharya,

UN-OHRLLS

continued on page 4

The consequence of the lack of accessto the sea means that it is far moreexpensive to import essential itemsand export goods. It is estimated thatthe basic import and export costs ofthe landlocked developing countriesare nearly twice those of their transitneighbours. On average, it costs$3,040 to export a standardizedcontainer of cargo from a landlockeddeveloping country, whereas theircoastal neighbours spend around$1,268, according to data provided bythe World Bank. Likewise, it costs acountry like Burundi $3,643 toimport a similar container ofmerchandise compared to its coastalneighbours in east Africa who payonly $1,567. While the APoA hasbeen successful in galvanizing globalsupport for LLDCs in the areas offinancial and technical assistance aswell as macroeconomic policydevelopment a disaggregated analysisreveals a different picture: progress isuneven, and the sustainability of thegains is not apparent. The HumanDevelopment Report 2014 paints astark picture. Notwithstanding the

SPECIAL FEATURE

Unlocking the Potential of Landlocked DevelopingCountries By Gyan ChandraAcharya, Secretary-General of the SecondUnited NationsConference on theLandlocked DevelopingCountries

Over the past decade the world hascertainly witnessed a series of

dramatic shifts in the landscape oftenas a result of the new found economicstrength of developing nations.Significantly greater prosperity hasin some cases translated into povertyreduction, job creation, increasedaccess to better health and educationservices and more meaningfulprospects for vulnerable populations,especially women and the youth. Butwhile these cross-sectoral gainsshould be applauded, we should havea deeper level of analysis. While somedeveloping nations continue to reapthe rewards of globalization, asignificant number of countriescontinue to lag behind. Among thisgroup are the world’s 32 landlockeddeveloping countries (LLDCs), whofind themselves structurallydisadvantaged mainly due togeography and its attendantdrawbacks.

Ten years ago the internationalcommunity gathered in Almaty,Kazakhstan to endorse an inauguralplan which recognized that withoutconcerted and collective action LLDCswould find it increasingly difficult toreap the benefits of internationaltrade and hence limit the resourcebase for investing in humandevelopment. At the heart of theaction-plan was an awareness that theLLDCs faced special challenges.

The international community finds

itself once again with an invaluableopportunity in Vienna to take stock ofthe progress achieved since 2003 andthe outstanding challenges thatremain to be addressed.

Since the adoption of the AlmatyProgramme of Action (APoA), LLDCshave recorded increased growth ofgross domestic product and foreigndirect investment. Several LLDCshave improved their ability toparticipate in international trade andexports have increased in the last tenyears though it is distributedunevenly.

There has been progress inimplementing all the priority areas ofthe APoA: fundamental transit policyissues, infrastructure development,international trade and internationalsupport measures. Agreements onregional highway and railwaynetworks have enhanced prospectsfor smooth transport facilities. Therehave also been some in-roads made inharmonizing transit and transportpolicies, streamlining of borderprocedures with supportivemechanisms between landlocked andtransit developing countries andprogressive efforts have been made todevelop and upgrade road andrailway infrastructure and foster andmaintain such infrastructure. Dryports are being established in allregions.

Yet LLDCs still face high tradingcosts and continue to have challengesin improving their competitiveness.They continue to contend with thestructural constraints such as thelack of productive capacities highcommodity dependence together withthe impact of the economic andfinancial crisis.

Geography certainly puts thesecountries at a distinct disadvantage.

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sharp drop in number of childrendying from preventable diseases andan uptick in the number of younggirls now in school, nine of the fifteencountries with the lowest HumanDevelopment Index scores arelandlocked. Life expectancy continues to lagbehind compared to their maritimeneighbours. It is clear that there isneed for a holistic and result-orientedoutcome document to emerge fromthe Vienna conference – one that hasa new generation of improved andinnovative support measures andmechanisms to assist the LLDCs.

First, there is a need to expand andstrengthen multi-stakeholderpartnerships capable of addressingthe core development challenges ofLLDCs. Second, there is a growingconvergence that the newProgramme of Action must beholistic. In this context, the focusshould be on economictransformation and diversification, aswell as the strengthening of theproductive capacities of LLDCs in theagriculture, manufacturing and theservices sectors. Indeed, data analysisshows a steady decline in agricultureand manufacturing value addition ofLLDCs. It has thus, become urgent toreverse this declining trend, and atthe same time promote LLDCs’participation in regional and globalvalue chains. Third, the private sectorin general, Small and MediumEnterprises (SMEs) in particular,have an important andtransformative role to play in jobcreation and poverty alleviation. Acompetitive private sector generatesefficiency, higher productivity,foreign exchange earnings andincomes. Regrettably, in a majority ofLLDCs, SMEs remain weak, havepoor access to markets, and manifesta lack of adequate financial and otherfactors of production - includingtechnology, skilled labour force, and

critical infrastructure and utilities.Fourth, regional cooperation plays animportant role to enlarge the scope ofcollaboration, connectivity anddevelopment of regional value chains.

Since landlocked developingcountries typically suffer from ageneral lack of resources and under-funded social sectors due to theirinherent structural barriers, officialdevelopment assistance strategieswould do well to recognize low-income landlocked countries’ largeinfrastructure needs and therequirement for increases in directassistance to support large-scaleinvestments in roads and railways.Such investments need to include notonly the up-front improvements ofthe transport infrastructure, but alsooperations and maintenance.

Modalities of private-public-partnerships for financing,constructing and operating largeinfrastructure projects should befurther explored as well. A significant

part of the Vienna conference will bededicated to this. The conferenceshould be a guide post to helpgeographically disadvantaged andvulnerable countries to move into aself-sustained growth trajectory withbeneficial integration into the globaleconomy and inclusive andsustainable development. We havegenuine expectations for theConference to deliver a Programme ofAction that can address the LLDCs’development needs and challengeswith strong support from theinternational community. Nationalleadership, regional collaboration andglobal partnerships should help tocreate a win-win situation for all.

Finally, the Vienna conference istaking place at a time when theinternational community is craftingthe post 2015 development agenda.The outcome of the conference willtherefore contribute to the elaborationof an inclusive and transformativepost-2015 development agenda.

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Unlocking the Potential ofLandlocked DevelopingCountries...continued from page 3

Since the adoption of the Almaty Programme of Action

(APoA), LLDCs have recorded increased growth of gross

domestic product and foreign direct investment. Several LLDCs

have improved their ability to participate in international trade

and exports have increased in the last ten years though it is

distributed unevenly.

– Gyan Chandra AcharyaSecretary-General of the Second UnitedNations Conference on the LandlockedDeveloping Countries

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what are the expectations for the SecondUN Conference on LandlockedDevelopment Countries, and what arethe key elements that you would like tosee included in the outcome document?

SK For Austria it is important todiscuss and find concrete ways tointensify our development efforts,improve infrastructure, reducebureaucratic obstacles and enhanceregional cooperation. Additionally, Iexpect that the discussions lead toconcrete results that will be translatedinto concrete actions.

The outcome documents, the ViennaDeclaration and the Vienna Plan ofAction, should certainly include arenewed commitment of solidarity withLLDCs. In particular in the context ofthe on-going debate on sustainabledevelopment goals, I believe the specialneeds of LLDCs must be stressed. Wealso need to take stock of the achieve -ments since the Almaty conference,identify lessons learned, share positiveexperiences and best-practices in orderto achieve better results.

Another key element for me is thehuman dimension. The focus on tradepromotion and trade facilitation as wellas on infrastructure is important.However, I would like to see aspects ofhuman capacity building beingconsidered as well. The transfer ofknowledge cannot only be enhanced viatrade and better roads and railwayconnections, but also through thefacilitation of the exchange of ideas andpeople-to-people contacts. In this respect,student exchange programmes,scientific cooperation across borders,

INTERVIEW

Interview with AustrianForeign Minister H.E. Sebastian KurzRicardo Z. Dunn interviewsAustrian Foreign MinisterSebastian Kurz.

Ricardo Z. Dunn It has been 10years since the first internationalmeeting on Landlocked DevelopingCountries (LLDCs) was held in Almaty,Kazakhstan in 2003. What is yourassessment of the progress achieved bythe LLDCs over the past decade?

Sebastian Kurz Since theadoption of the Almaty Programme ofAction (APoA) tangible progress hasbeen achieved by almost all landlockeddeveloping countries. While positivedevelopments can be seen in manyimportant areas, in some other areas westill see stagnation or certain problemsthat need to be addressed.

An area where landlocked developingcountries have made remarkableprogress is mobile telephony andinternet usage. We also see an increasein physical infrastructure. In Africa, theTrans-African Highway, and in Asia, theAsian Highway and the Trans-AsianRailway networks have seen majorupgrades. Through initiatives ofregional integration and cooperation,important measures have beenundertaken aimed at the reduction oftransaction costs, the minimization ofdelays at border-crossing points, or theharmonization of customs procedures,rules and regulations.

In the area of human development, wecan see that many LLDCs have achievedimpressive progress with respect to theMillennium Development goals. Forinstance, the group-wide mortality ratefor children under the age of 5 hassignificantly declined, youth literacyshows an upwards trend and women’sempowerment has increased.

Despite the progress mentioned,landlocked developing countries still lagbehind other developing countries.Populations are growing and aspirations

are growing as well. We thus need tointensify our efforts to tackle the oftencomplex challenges that landlockedcountries face in a holistic manner.

Taking into account the discussions ofmy colleagues in LLDCs and in transitcountries, I believe that many of theactions set forth in the AlmatyProgramme of Action remain valid, andit is in this context that the ViennaConference will present an excellentopportunity to renew our commitmentand work towards concrete solutions.

RZD The conference comes at a timewith increasing political insecurityacross the globe, why should theinternational community pay closerattention to the challenges faced by theLLDCs?

SK One may look at this matter fromthe angle of international security.Starting from a global perspective,political insecurity can and should beaddressed by preventive measures aimedat solving structural problems. The rootcauses of conflict can often be found inthe socio-economic dimension. Fear andhate often have their breeding groundsin hopelessness, lack of perspectives andopportunities. If we look at it from acomprehensive concept of security,advances in LLDCs are in everyone’sinterest, because there is no strongerpower for good than the hope for abetter life for all.

However, I feel personally much morecomfortable looking at the issue with amore positive attitude: Together, theterritories of the 32 LLDCs have a totalpopulation of more than 428 millionpeople, many of them under the age of25 years. Naturally, these young womenand men, these girls and boys haveaspirations for a better life. They havetalents and are willing to work hard toachieve their dreams and hopes. I seethese people more as a potential, asource of creativity and capabilities, whowill make important contributions to thegrowth of their countries.

RZD From the perspective of Austria,

Austrian Foreign Minister H.E. Sebastian Kurz.

continued on page 6

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improvement of access to internet are ofgreat importance.

RZD The role of the private sectorhas become increasingly importantwithin the global debate on development.Could you share with us your view onhow the private sector can partner withgovernments in the LLDCs to acceleratedevelopment?

SK The fact that we organize a privatesector business and investment forumduring the conference is a cleartestimony to the important role theprivate sector has to play in thedevelopment of LLDCs.

For instance, to close the financing gapwith respect to infrastructure, it will beinstrumental to explore innovativefinancing mechanisms, including theuse of private-public partnerships,infrastructure bonds and diasporabonds. Moreover, multi-sectorinfrastructure-sharing initiatives (e.g. interms of roads, power andcommunications) should also beconsidered. Finally, I am convinced thatdevelopment policies need to facilitateefforts to attract FDIs for sectors thatproduce goods and services which areless sensitive to transport costs.

Private sector engagement of course hasto be fully transparent, non-exclusiveand live up to corporate socialresponsibility commitments.Nevertheless, it remains paramount forgovernments to enable an investorfriendly environment and to enforce therule of law.

RZD What do you expect from theinternational community at this point ofthe LLDC' development trajectory?

SK Continuing solidarity is veryimportant in this regard. Only throughinternational and regional cooperation,sustainable development can beachieved.

The role of the private sector in thedevelopment of LLDCs will certainlyincrease in this regard, while OfficialDevelopment Assistance (ODA) willremain important as well.

As far as the on-going discussions of thepost-Millennium Goals are concerned, Ibelieve this conference will serve as animportant political signal conveying the

message that the needs of the mostvulnerable economies deserve specialattention.

RZD As a landlocked developedcountry, Austria is an ideal situation toshare with the LLDCs lessons learned.What, in your opinion, would be the keylessons for LLDCs to take on board?

SK There are, to begin with, hugedifferences among landlocked countriesin terms of climate, geography, access towater ways, natural resources. Hence weneed a differentiated approach as thereis no “one-size-fits-all” solution todevelopment.

In the case of Austria I can point outthree elements that have been decisivefactors for our development:

Infrastructure Development: Austria hasa highly developed transportinfrastructure, linking us with allneighbouring countries by road, rail andair. Austrian companies are thereforeamong global technology leaders whenit comes, for instance, to tunnellingtechnology, railway technology and roadconstruction.

Regional integration and cooperation:For Austria, the integration into thecommon market of the European Unionhas had a tremendously beneficialimpact on our economy. Creating asingle market has drastically reducedexport and import costs. Withoutregional integration and cooperation,

the wealth that Austria enjoys todaywould have been impossible.

Human capital: Austria’s economy hadalways access to a large pool of highlyskilled labour. In the past decades, wehave continued to develop vocationaltraining schemes through private andpublic partnerships. We are convincedthat the continuous investment ineducation will be the best guarantee forAustria’s future competitiveness in theWorld markets. At the same time, weactively provide those training schemesfor LLDCs such as in the case ofMoldova where we cooperate withAustrian businesses.

RZD What is your key message tothe international community about theconference?

SK The challenges of LLDCs has to beseen in economic terms, such as traderoutes and transport, but also in termsof circulation and exchange of ideaswith the rest of the world. Whenconsidering all those factors, it all boilsdown to the fact that cooperation is ofkey importance.

Let us work on a programme withconcrete actions and clearly definedpriorities, targets as well as a concretetimeframe that unlocks economicgrowth by promoting at the same timesustainable development. Mostimportantly, such a programme shouldbe a source of hope for the youngergenerations.

Sebastian Kurz Interview...continued from page 5

In the area of human development, we can see that many

LLDCs have achieved impressive progress with respect to the

Millennium Development goals. For instance, the group-wide

mortality rate for children under the age of 5 has significantly

declined, youth literacy shows an upwards trend and

women’s empowerment has increased.

– Sebastian KurzAustrian Foreign Minister

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Opening Up Trade Corridors forLandlocked Southern African Countries

The deep-sea Port of Walvis Bay isNamibia’s largest sea port,

receiving approximately 3,000 seavessels per year and handling around5 million tons of cargo. Since itsestablishment the port has provideddirect access to principal shippingroutes, offering shippers a timesaving of up to five days between theSouthern African DevelopmentCommunity(SADC) region, Europeand the Americas for the importingand exporting of goods such asvehicles, mining equipment,electronics, frozen meat and chicken,copper and machinery.

In 2000, as the Port of Walvis Baycompleted a deepening programme to12,8 metres, a group of transport andlogistics stakeholders came togetherto establish The Walvis Bay CorridorGroup (WBCG). As a Public Private

Partnership, WBCG operate anintegrated system of well-maintainedtarred roads and rail networks,accommodating all modes oftransport, from the Port of Walvis Bayvia the Trans-Kalahari, Trans-Caprivi,Trans-Cunene and Trans-OranjeCorridors - providing landlockedcountries from the Southern AfricanDevelopment Community with accessto trans-Atlantic markets.

“Our efforts over the years nowprovide a safe and secure alternativetrade route to the southern Africanlandlocked countries,” said CliveSmith, Project Manager at theLogistics Hub of the WBCG. “Thepartnership allows for the pooling ofresources, expertise and authoritiesfrom both the regulators and theoperators, who together form anintegrated transport and logistics

service for potential customers.”

“Namibia is party to the SouthernAfrican Customs Union Agreementand through this body our CustomsDepartment works closely withregional customs and revenueauthorities to streamline the borderprocesses and customs control,” headded. “We have various bodiesthrough which we engage with ourcustoms and border posts. OurMinistry of Finance, department ofcustoms, are also a member of theWalvis Bay Corridor Group. There arethen also two bi-lateral agreementsthat we host and have a role in.Through these forums we addressissues like border operating hours,efficiencies and technical expertise ofborder officials, One Stop Borderposts, etc.”

An aerial view of the port of Walvis Bay.

continued on page 8

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The Group services the Trans-Kalahari Corridor, which links thePort of Walvis Bay to Gaborone andGauteng province in South Africa.From there, this corridor links withthe Maputo Corridor on the east coastof southern Africa. The Trans-CapriviCorridor is also accessible, opening upthe landlocked countries of Zambiaand Zimbabwe and also theDemocratic Republic of Congo. TheTrans-Cunene Corridor extendsthrough northern Namibia intosouthern Angola, and the Trans-Oranje Corridor links the Port ofLüderitz with the Northern CapeProvince of South Africa.

“The WBCG is one of the few successstories of Public Private Partnershipentities that are functioningeffectively in Namibia and SADC. TheWBCG’s unique compilation of Privateand Public stakeholders provides itwith distinct advantages. There isthough, still a gap between the publicand private sector that calls for moredialogue and closer collaboration, not

only in Namibia but also acrossAfrica. We continue to advocate formore private sector involvement invarious development projects whilst atthe same time soliciting support fromthe private sector,” explained Smith.

Into the future the WBCG has a clearvision for Namibia to become aregional leader in logistics anddistribution in Southern Africa. Smithstresses that ‘the WBCG stronglybelieves in and supports the furtherdevelopments of the Namibia LogisticsHub concept as an initiative that could

not only bring sustainable economicgrowth for Namibia but indeedgreatly contribute towardsdevelopment in Southern Africa. “We will continue to advocate forcollaborative approach to the variouselements under this project ensuringwide stakeholder engagement andparticipation. For this the WBCG willalso transform its current CorridorManagement role to a more dedicatedfocus on business developmentthrough our regional footprint,”Smith said.

Opening Up TradeCorridors...continued from page 7

WALVIS BAY CORRIDORS

WALVIS BAY TRANSIT TIME MAP

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NN In 2012, USG Acharya noted thatthe implementation of the AlmatyProgramme of Action, has contributedto LLDCs increasing their exports fromabout 0.5 percent of total world exportsto just over 1 percent. Would youconsider that a satisfactoryprogression?

KA Yes, I certainly agree with USGAcharya that indicators demonstrateconsiderable results. LLDCs as a grouphave recorded impressive tradeperformance in the recent past, withtotal exports increasing almost fivefoldbetween 2000 and 2010, the share ofthe group in global trade is still modestand amounted to only 1.04 per cent in2010. LLDCs have been marginalizedin the global trading system.

Moreover, the LLDCs' exports areconcentrated in a few countries and ina few products. Six countries —Azerbaijan, Botswana, Kazakhstan,Paraguay, Turkmenistan, andUzbekistan accounted for 70 per cent ofLLDC merchandise export.

In terms of products, the external tradeof LLDCs continues to be highlyconcentrated in a few primarycommodities — crude oil and naturalgas, minerals and metals.

The vast majority of LLDCs suffer fromhigh transport costs and lowcompetitiveness and so it is not as easyto transact business as otherdeveloping countries do. The LLDCsare unable to utilize their trade-inducedgrowth for socio-economicdevelopment.

INTERVIEW

Advocating New Initiativesfor the Vienna Programmeof ActionIn an interview with THECOMMITMENT’s NoshNalavala, the PermanentRepresentative ofKazakhstan to the UN,Ambassador KairatAbdrakhmanov outlinesnew initiatives towardsLLDC success.

Nosh Nalavala Ambassador, at oneof the very first meetings of LLDCs inAlmaty, it was said that “LLDCs mustmove from being land-locked to beingland-linked.” In your view have theLLDCs come closer to that goal?

Kairat Abdrakhmanov The LLDCsconstitute a vast range of countrieswith different political orientations,economic growth and developmentrates, national targets and progressachieved. It is difficult to speak ingeneral about all LLDCs in one broadstatement. I would however qualifysaying that all LLDCs are makingserious efforts but thataccomplishments vary from country tocountry. However, global solidarity andpartnerships have helped to transformthe LLDCs from being landlocked tobecoming land-linked.

NN What is the most importantobjective for LLDCs?

KA For the 32 LLDCs, the promotionof efficient transport systems is animportant objective, but these effortsmust not stop at their countries'borders. Many investments intransport and trade facilitationinfrastructure need to be cross-borderin nature and hence close cooperationbetween LLDCs and their transitcountries is a sine qua non for theimproved cross-border transportconnectivity of LLDCs.

NN The Almaty Programme of Actionwas initiated in 2003. How would youcharacterize its passage through theseyears as we head for the Conference inVienna next month?

KA The Almaty Programme of Action(APoA), first developed in 2003, hashelped create new linkages andstrengthened existing partnershipsbetween landlocked developingcountries, transit developing countriesand development partners, includingmultilateral institutions. Though thereis noteworthy progress, we must alsorecognize that the majority of oureconomies remain vulnerable toexternal shocks and other emergingchallenges. We are also aware that wehave not been able to reach most of theMillennium Development Goals, andour countries continue to bemarginalized from the internationaltrading system. The structuralimpediments associated tolandlockedness remains a challenge.

NN Can you tell us more about theimpediments faced by LLDCs?

KA The reality is that our economiesshow relatively high trade openness -but their absolute level of trade has yetto get close to its full potential.Infrastructure, trade barriers andinsufficient technological capacitiescontinue to hamper us. At the sametime, reliance on a narrow range ofexports – often a limited number ofcommodities presents a significantweakness. Economic diversificationmust, therefore, be an urgent priorityto both resource-rich and resource-scarce LLDCs.

Thus the areas of infrastructureconnectivity, growth and facilitation oftrade and increased integration ofeconomies will have to feature in theupcoming Programme of Action to beadopted in Vienna. New goals will beset in a more ambitious manner toenhance efficiency of the LLDCs intransit transport and tradetransactions.

Permanent Representative of Kazakhstan to the UN,

Ambassador Kairat Abdrakhmanov.

continued on page 10

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NN What gains do you see as aconsequence of the APoA?

KA The implementation of the APoAhas resulted in LLDCs making somegains with regard to expanding transittransport infrastructure facilities,reducing delays and inefficiencies inthe border formalities. Consequently,there has been harmonizing of normsand standards in the transit transportsector and increasing trade, includingits facilitation. What has been mostremarkable it that since 2003, theLLDCs have also reached someimpressive targets in human and socialdevelopment.

NN Given that the APoA was so verycomprehensive, where do you seechanges/improvements in itsframework both in negotiations and itsoutcome at the Conference?

KA The APoA has been a landmarkmilestone and has brought sharp focusto the needs of LLDCs and the record ofaccomplishment in all regions has beenremarkable. At the same time somecountries face greater impediments,which have got more aggravated withchanged circumstances, the globalpolitical and economic climate. InVienna, the international communityshould develop a new comprehensive,common action-oriented framework ofLLDCs for the next decade, whiletaking into account the unfinishedagenda of Almaty Programme ofAction as well as the new emergingdevelopment challenges that LLDCsface today that are almostunprecedented in nature andmagnitude.

NN Kazakhstan is the largestlandlocked country in the world. Howhas the APoA benefited in making thecountry more land-linked, consideringthe fact that the country does not haveany access to the sea?

KA Being the country where theAPoA took shape, we have considered itour special responsibility to advocatefor the APoA and ensure its effectiveimplementation not only at theinternational level, but also theregional and national. Being alandlocked country, we are resolved toprove how obstacles can be overcome

and so developed the StrategyKazakhstan 2050 with the aim tobecome, by that year, one of the 30most developed countries of the world.

NN How would you rate Kazakhstan’sprogress as a landlocked country?

KA In the two decades since gainingindependence, Kazakhstan hasemerged as one of the most attractivedestinations for foreign directinvestment and joint venture expansionin Central Asia. Located in the heart ofthe Eurasian continent in the ancientSilk Road of Antiquity, Kazakhstan isan emerging market with significantnatural resources, a stable politicalregime and an improving investmentclimate.

The country has made significantstrides with regard to transportinfrastructure. We have established anddeveloped five international transitcorridors: the Northern, Southern, andCentral corridors of the Trans-Asianrailway line, the North-South corridorthat combines rail and water transport

linkages, and the Europe CaucasusAsia Transport Corridor (TRACECA).In addition, we also have fourinternational aviation corridors. Theambitious project “Western China –Western Europe” is going to connectthem along a 1.700-miles highwaythrough Kazakhstan.

NN With 16 countries, Sub-SaharanAfrica has the highest concentration oflandlocked countries. Do you see theAPoA framework going through aradical change at the Viennaconference in favor of the AfricanLLDCs?

KA We are heartened by thenoteworthy strides taken by theAfrican continent, notwithstanding thesevere decades of political setbacks,conflict and civil strife. Africancountries have had to faceunprecedented natural disasters thatplunge them into greater depths ofpoverty. Yes, African countries are at aparticular disadvantage and needspecial consideration.

Ambassador KairatAbdrakhmanov Interview...continued from page 9

In the two decades since gaining

independence, Kazakhstan has emerged as

one of the most attractive destinations for

foreign direct investment and joint venture

expansion in Central Asia.

– Ambassador Kairat AbdrakhmanovPermanent Representative ofKazakhstan to the UN

Stanislav E. Shmelev

11SPECIAL EDITION

Using the Coca-Cola Model to BuildValue Chains for Medicine

by Louise Stoddard

C oca-Cola appears in the shops andkiosks of remote rural

communities around the world, yetthe same cannot be said for essentialmedicines. In many of the developingcountries that see effective Coca-Coladistribution networks in operation, 1 in 9 children die before their 5thbirthday from simple preventablecauses such as dehydration fromdiarrhoea. The UK-based charity,ColaLife was set up in 2008 by Simonand Jane Berry, with a mission toutilise the same models that Coca-Colaand other commodity producersemploy, to open up private sectorsupply chains for essential productssuch as oral rehydration salts andzinc supplements.

“We wanted to use the same principlesand networks as Coca-Cola and othercommodity producers to provideparents with lifesaving diarrhoeatreatment” Simon told TheCommitment. “At first we werefocusing on whether we couldpiggyback onto the Coca-Coladistribution networks and use theempty space in the crates formedicine. But after furtherinvestigation we realised theimportance of creating value for theproduct and using a similar model toCoca-Cola – where money is made ateach point, whether that’s in theproduction of the diarrhoea kit, thestorage, distribution or the actualpoint of sale,” he explained.

With advice and support from anumber of organisations andcompanies including The Johnson &

Johnson Corporate Citizenship Trustand the UK’s Department forInternational Development, Simon andthe team set up a one year pilot projectin Zambia. Working with a local NGO,the trial aimed to ensure that KitYamoyo, a diarrhoea treatment packthat contains oral rehydration salts,zinc, soap, and an information leaflet,was accessible in the same kind ofrural village stores and kiosks whereCoca-Cola is so often sold. For a yearthe pilot tested how value could becreated in the basic diarrhoea kit.

At a retail price to the customer of 6.3Kwacha (approximately $1 USD), thepilot ensured that profit was madethroughout the production process –with wholesalers buying the kit for3.1 Kwacha and retailers then buyingfor 3.7 Kwacha.

A trader with his goods on a bike, including Kit Yamoyo, Zambia.


Simon Berry

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Local production of the kits inZambia, including zinc tables, is keyto the ColaLife strategy. “Many peopleasked us why we were not getting bigpharmaceuticals involved that couldproduce cheap medicine in countriessuch as India,” says Simon. “Butimporting is expensive in Zambia, wewent for a local manufacturingapproach which in the long run wasno more expensive and meant that thechain wasn’t subject to changeableexchange rates and customers couldaccess medicine with a decent shelflife on it, which might have otherwisebeen a year into its use-by-date by thetime it arrived in Zambia,” he said.

After 12 months the ColaLife teamcarried out a baseline survey andfound that they were having a bigimpact. Twenty six thousand kits had

been sold in the two remote rural trialareas. Up to 45 per cent of children inthese areas received oral rehydrationsachets or zinc, up from a baseline of1 percent. Importantly, accessibility tothe medicine improved dramaticallywith the average distance that acustomer would have to travel tolocate the treatment reducing from7.3 km to 2.4 km.

“Running a successful trial is onething, scaling up is quite another,”said Simon. “For the Zambian trial, weput a lot of effort, right from theoutset, into recruiting and supportinga willing manufacturer – not just forthe trial, but potentially for the longerterm. We were looking for a partner,not just a supplier. After liaising withpotential manufacturers both big andsmall, we finally found a willingpartner in Pharmanova – one ofZambia’s few, small pharmaceuticalmanufacturers. The partnership hasbeen – and continues to be – a two-waylearning exchange. But as a relatively

small business, they can only invest alittle in market development for scaleup. We are willing; they are willing.But we still need to work on findinginvestment to enable us to establishthe product in the market,” heexplained.

“The market for diarrhoea treatmentin Zambia is estimated at between 7mand 10m treatments per year – let’ssay it’s 8.5m. Up to 3m treatments aredistributed by the existing publicsector. That leaves 5.5m per year.Within 3 years we think we can reach40 per cent of this market or 2.2m.But the education piece that stillneeds doing is beyond the resourcesof Pharmanova. For a low-valueproduct like Kit Yamoyo, the returnon investment would be too slow, andtoo low. Yet the social returns for afunder or social investor are huge.Once the product is established it willbe saving children’s lives forever yearon year,” he said.

Using the Coca-Cola Model...continued from page 11

Baby Simon (aged 1) with a Kit Yamoyo, Zambia Simon Berry

13SPECIAL EDITION

BORDEREDBY BORDERSP H O T O C A L L

BY LOUISE STODDARD

Far from the sea, the landlocked developing countries of the

world face many challenges but also offer rich cultural

heritages and incredible natural landscapes. This year, as the

international community meets in Vienna, UN-OHRLLS will

shine a spotlight on the diverse group of 32 landlocked

developing countries and showcase their uniqueness through

photography.

A photo call for the best pictures from landlocked developing

countries was advertised in September and UN-OHRLLS staff

have been inundated with photographs from Afghanistan to

Zimbabwe. Participants at the Second International Conference

on Landlocked Developing States will have an opportunity to

see a selection of the best photographs from each country in

an exhibition when they attend the conference in Vienna.

Photographs will also be available online, highlighting the best

from each country and the various categories of the photo call:

Expect the Unexpected, Overcoming Obstacles, Culture and

Arts and Work and Play.

Over five hundred photos were submitted to the photo call.

Thank you to everyone who contributed.

URL http://unohrlls.org/borderedbyborders/

TOP PHOTO: Nepal. Working woman inKathmandu. Photo by Eric Ganz

MIDDLE LEFT PHOTO: Moldova. Harvest. Photo by Luke Addison

MIDDLE RIGHT PHOTO: Armenia. An unusual ripeningstorage spot for squash inArmenia. Photo by Anik See

BOTTOM PHOTO: Central African Republic. A football match at KoudoukouSchool. Photo by Sandra Black,IOM

TOP PHOTO: Malawi. Working in the tea fields. Photo by Lucy O'Neill

MIDDLE LEFT PHOTO: Uzbekistan. Locals take a dip in the lake near TashkentCity. Photo by Tair Chelebiyev

MIDDLE RIGHT PHOTO: Kyrgyzstan. The Winners. Traditional game played atSong Kul lake. Photo by Mario Villamiel

BOTTOM PHOTO: Afghanistan. A boy sells bread ona cold day in Kabul.Photo by Valeria Bove

TOP LEFT PHOTO: Uganda. A young woman collects water on her bike inUganda. Trisa Taro

TOP RIGHT PHOTO: Landlocked Navigators. Photo by Fatima Villasboa Maidana

MIDDLE RIGHT PHOTO: South Sudan. Trader. Photo by James Sprankle

BOTTOM LEFT PHOTO: Moldova. Going to work at 5.30 am on InternationalWomen's Day. Photo by Frans Sellies

BOTTOM RIGHT PHOTO: Lesotho. A woman at a garment factory. Photo by Franco Esposito ALAFA

TOP LEFT PHOTO: Kyrgyzstan. Two girls, just graduated from college runthrough a fountain of water in Bishkek. Photo by Heming Yip

TOP RIGHT PHOTO: Kazakhstan. Tian Shan mountains, a natural barrier forcommunication across countries and a unique ecosystem.Photo by Stanislav E. Shmelev

MIDDLE PHOTO: Chad. Passing caravans drink and rest at Guelta d'Archei.Photo by Isabelle Boutriau

BOTTOM LEFT PHOTO: Bolivia. An Aymara shaman, flashes a toothy grin afterperforming a ritual blessing. Photo by Alexandra Melean

BOTTOM RIGHT PHOTO: Ethiopia. Trading at the highland market of Dorze. Photo by Shifaan Thowfeequ

18 SPECIAL EDITION

Furthermore, our companies have beenencouraged to participate in so-calledbusiness partnerships in developingcountries, with part of the investmentsupported by official Austriandevelopment aid.

Our cooperation with NGOs focussedon development aid aims to identifydevelopment projects of NGOs whichcould eventually evolve intocommercially reliable investments. Thepromotion of procurement projects ofinternational finance institutions (IFIs)among our companies should also helpto result in increased sustainableinvestments.

RZD Can Austria promote its“enlightened interest” towards win-winpublic private partnerships that benefitboth Austrian companies anddeveloping countries, withoutcompromising development objectives?

LC Development cooperation is part ofeconomic policy. In addition tofocussing on development goals inLLDCs, it should be remembered thatAustrian companies have to generate areturn-on-investment. The partnershipbetween the business sector anddevelopment cooperation has to beclearly specified. A functioninginternational and local legalframework, adequate access tofinancial resources, vocational trainingas well as the creation andmaintenance of the infrastructureshould be our priorities to achieve thegoal of successful cooperation, eitherwith business-to-business or publicprivate partnerships.

INTERVIEW

Private Sector Key toAccelerated DevelopmentRicardo Z. Dunninterviews Dr. ChristophLeitl, President of theAustrian FederalEconomic Chamber.

Ricardo Z. Dunn There is agrowing consensus that the privatesector can significantly contribute tosustainable and inclusive development.Yet, evidence of which partnershipmodels with the private sector fordevelopment are effective is still scarce.What is the Austrian experience andwhat key lessons do you draw from it?

Dr. Christoph Leitl The Austriansystem of co-operation between themajor economic interest groups as wellas between them and the government,the so-called ‘Social Partnership‘ is anasset in the face of global challengesand could be an inspiring model forstructured dialogue in other countries.

In addition, the Austrian system ofintegrated dual education can serve asa building block for inclusivedevelopment. Dual educationprogrammes are based on a mix of onthe job training in a company as wellas courses at school, i.e. companies andschools involved act in partnership. Wesee this as a good example of howcompanies can contribute tosustainable and inclusive development.

In support of business relations withlandlocked developing countries(LLDCs) we cooperate with theInternational Trade Center (ITC) toprovide SMEs in developing countriesfree access to trade and company datain order to initiate new partnerships.

Finally. the Austrian Federal EconomicChamber very actively engages inassisting other business supportorganizations in their modernizationefforts, for example, we recallsuccessfully implemented projects inKyrgyzstan and Turkmenistan.

RZD Earlier this year the European Commission released itsCommunication on the role of theprivate sector in development. What isyour assessment of it, and what do yousee are the key priorities and mainchallenges?

CL With its commitment to furtherSMEs the European Commission makesan important contribution tosustainable and inclusive developmentas they are the essential pillars forinnovation, job creation and growth.Financing, however, remains a crucialbottleneck for business anddevelopment. Finding innovativefinancing solutions and blendingdifferent sources of finance is thereforeneeded.

RZD What role do you see forAustrian companies investing inlandlocked developing countries?

CL Austrian investors are appreciatedas reliable partners as well as for theircommitment in long-term sustainabledevelopment. Austrian companiescould offer expertise in industrial plantconstruction, renewable energy,environmental technology andmechanical engineering. Austrianexperts are able to provide knowledgeand solutions for low-carbon andenergy resource efficient solutions.aswell as for water treatment andirrigation. Environmental engineeringand infrastructure projects couldinclude hospital facilities, sewagesystems, road and rail networks andpower plants. Aware of the potential ofour companies, we encourage them togo abroad and promote businesspartnerships, trade and investmentwith LLDCs.

RZD How can Austria and the EUbest promote and productively channelsustainable and inclusive investments?

CL In the past years we have beentrying to create an awareness amongour member companies in regard to“business and development” by co-organizing business and investmentforums focussed on developingcountries in general.

Dr. Christoph Leitl, President of the Austrian

Federal Economic Chamber.

19SPECIAL EDITION

Geography Accelerates the Effects ofClimate Change on LandlockedDeveloping Countries

by Priscilla Masilamani

A lthough the world’s 32 landlockeddeveloping countries (LLDCs) are

among the countries that contributethe least to greenhouse gases, theycontinue to experience the deleteriousimpact of climate change.

Research has revealed that climatechange has affected the agriculturalpractices in LLDCs, the backbone ofmost of these economies. Small-holderfarmers, who often rely onsubsistence-level-rain-fed agriculture,bear the brunt of the challenge.

Erratic rainfall patterns, floods,

droughts, and prolonged dry spellshave given rise to shorter growingseasons and poor crop yields. Highertemperatures have led to more insect-borne diseases and a paucity of water.With no arable land, less foodproduction and with little or no accessto food, the local populations arepushed into poverty with manyLLDCs now facing food and nutritioninsecurity crisis.

Women are often the hardest hit, asthey are often the ones left to tendfamilies and small farms, and havefewer alternative livelihoods whencrops are lost, while children sufferfrom malnutrition.

In an effort to overcome threats tofood security in the face of climatechange, alliances between small-scaleindigenous farmers, agriculturalscientists and aid organizationsfunction as a critical element inoffsetting the effects. Adaptivemethods such as conservationagriculture, one of the modes ofclimate-smart agriculture, along withagroforestry and water harvesting areproving to be effective.

With the highest rate of malnutritionin the world, Malawi is on the path toadapting to climate change as a resultof the various transformative

Rapid melting glaciers in Kyrgyzstan.


Matthias Buehler/Flickr

20

international partnerships. Bysupplying good quality seeds for highnutrition crops such as groundnutand beans, sustainable farmingpractices have been introduced togreat success. The programmes havehelped farmers enrich their soils, theirdiet and have helped them earn moneyfor their families.

Bhutan has entered into a partnershipwith Peru to share potato cropvarieties. The Climate News Networkreports that the countries are toexchange both indigenous crops anddirectives on how to best harvest themin different climes, with the objectiveof helping all involved maintaineffective, independent food systems.

Migration of affectedpopulation

Livestock production is anotherlivelihood that is highly sensitive toclimate change. Severe drought tendsto result in decreased livestockproduction, less meat, dairy and eggproduction due to little or noavailability of fodder.

A report by the United NationsUniversity (UNU) and the NorwegianRefugee Council (NRC) details the riskfor Ethiopians where a massivedisplacement to neighboring countriesfor lack of work due to climate crisisis imminent.

A major drought in the Horn of Africahas developed into famine, impedingsmall-scale farmers’ livelihoods andforcing them to seek work outside oftheir borders. The extreme weatherevents affecting the pastoralists, withlittle education and climate-sensitiveoccupations, are exacerbated bypoverty, violence, and ethnic andpolitical discrimination.

According to a United Nations report,the already widespread populationdisplacement caused by climatechange will lead to increased conflict

In order to understand how climatechange will affect the country’sfuture, the government of Nepalcommissioned a study that found thecosts of climate change to the countrywill rise to 2 to 3 percent of its currentGDP by 2050. By the 2070s, netagricultural losses in Nepal areestimated to cost approximately 0.8percent of the country’s GDP, or $140million a year.

For Latin American LLDCs, such asBolivia and Paraguay, the biggestrisks are concentrated in agriculture,water availability, forest conservationand loss of biodiversity.

Bolivia, with the highest percentage ofindigenous people who live in extremepoverty, is home to over 20 per cent ofworld’s tropical glaciers and boasts themost bio-diverse ecosystems in theworld. Located in a climaticallyvolatile region, retreating glaciersdecrease water availability while highlevels of deforestation in thesurrounding amazon increase thevulnerability to flooding. Mosquito-borne diseases and forest fires are alsoon the increase.

The politics of water security

Fed by huge glaciers and extensivesnow cover, Kyrgyzstan hosts theheadwaters of many of Central Asia’smajor Trans-boundary rivers, makingit a critical source of fresh water for anumber of neighboring countries.

and insecurity unless governmentstake urgent action.

The high cost of naturaldisasters

Extreme climate events such as floods,droughts, cyclones, etc. can causemassive destruction to property,infrastructure such as roads, bridges,rails, telecommunications etc. in away that can overshadow thecommendable progress so far achievedin LLDCs.

In August this year, Nepal witnessed adevastating landslide that killed morethan two hundred people anddestroyed dozens of houses. Nepal,which is characterized by steep slopesand active seismic zones, has most ofits population dependent onagriculture. Considered one of theworst landslides in more than adecade, the tragedy was then followedby torrential rainfall which causedflooding and even more landslides.

Official data emphasizes the sheermagnitude of natural disasters inNepal. In the past 30 years, 4,511people have died as a result oflandslides, in addition to destroying18,414 houses, affecting 555,000people.

Climate change and extreme weatherevents have already cost Nepal anestimated 1.5 to 2 percent of thecountry’s GDP, reports the ClimateDevelopment & Knowledge Network.

Geography Accelerates theEffects of Climate Change...continued from page 19

SPECIAL EDITION

With the highest rate of malnutrition in the

world, Malawi is on the path to adapting to

climate change as a result of the various

transformative international partnerships.

By supplying good quality seeds for high

nutrition crops such as groundnut and beans,

sustainable farming practices have been

introduced to great success.

Danger to these glaciers and snowcover could severely impact water,food and energy security across alarge swath of Central Asia.Shrinking of glaciers and mountainsnow surfaces is resulting in watershortages and will potentially lead toproblems with agriculture, watersharing and energy in the region,says a UNDP report. As precipitationpatterns change, landslides pose agreater threat.

A survey conducted by ChathamHouse says that proper managementof water and addressing trans-boundary water relations will helpdeal with extreme weather events and

international community to addressthe issues. More sustainableapproaches to production, such asrenewable energy sources are beinglooked into for further development.

As most LLDCs are located in barrendry desert lands where solar energy(due to high temperatures) and windoccur in abundance, exploiting thesenatural resources to maximumadvantage are imperative.

determine their ability to contend withthe consequences of climate change.

As most of LLDCs are located in dryland areas, water scarcity imposes asevere constraint. With 52.5 per centof dry lands located in LLDCs and 60per cent of the population located indry lands compared to only 32.2 percent in transit developing countries,these countries face dire threat toclimate change, desertification andland degradation.

Although climate change anddesertification issues are incorporatedinto development priorities at thenational and regional levels, moreresources are needed from the

21SPECIAL EDITION

A farmer harvests maize in Mali. P. Casier, CGIAR/Flickr

22 SPECIAL EDITION

International Trade and Trade Facilitation

Landlocked Developing Countries(LLDCs) face special challenges that areassociated with their lack of directterritorial access to the sea andremoteness and isolation from worldmarkets. Their seaborne tradeunavoidably depends on transitthrough other countries. Additionalborder crossings and the long distancefrom major markets, coupled withcumbersome transit procedures andinadequate infrastructure,substantially increase the totalexpenses for the transport services andother transaction costs that erode thecompetitive edge of LLDCs. As a resultthe LLDCs are disadvantaged fromfully utilizing trade for theirdevelopment. Greater integration ofLLDCs in world trade and into globalvalue chains, as well as enhanced tradefacilitation is vital for increasing theircompetitiveness and ensuring theireconomic development.

Integrating LLDCs in Global andRegional Trade MarketsLLDCs’ merchandise exports haveincreased fivefold in value since theAlmaty Programme of Action wasadopted. In 2003, the value ofmerchandise exports from LLDCsaccounted for a negligible 0.58 per centof the global volume. As of 2013, theshare of global merchandise exportfrom such countries had more thandoubled to 1.2 per cent. This howeverstill remains negligible, highlightingthe continued marginalization ofLLDCs from world markets. Inaddition, the export structure of LLDCscontinues to be increasinglycharacterized by reliance on a limitednumber of export products, in

particular agricultural and mineralresources. More efforts are needed todiversify the production and exportstructure of LLDCs, and enhance theirproductivity in order to take advantageof the multilateral trading system.

With the growing inter-linkages inworld trade, investment andproduction, global value chains accountfor a rising share of internationaltrade, offering new opportunities formany developing countries. Yet, LLDCshave not been able to fully participate inregional and global value chains.Linking into global value chainspresents an opportunity for LLDC tobecome important links in theproduction and distribution chain.

Regional integration arrangements(RIA) have over the years contributed tothe expansion of trade for LLDCs,broadening LLDCs’ markets andboosting their supply-side capacity.Increasingly, RIAs are embarking oninfrastructure development projects atthe regional level – extensive roadnetworks, advanced telecommunica -tions technology, energy grids, etc.,which, aside from helping addressLLDCs’ key supply-side constraints,also facilitates trade among and beyondthe RIA members, while also boostingproductivity.

The Doha Round of WTO tradenegotiations must be concluded as soonas possible, paying attention to thedevelopment concerns of LLDCs.Emphasis should remain on thecommitment to make operationallyeffective the principle of special anddifferential treatment for developingcountries; to the parallel elimination ofall forms of export subsidies; and to

substantial reductions in trade -distorting domestic support, inaccordance with the mandate of theDoha Round.

Enhancing Trade Facilitation forLLDCsNon-physical barriers, delays andinefficiencies associated with bordercrossings and ports, including customsprocedures and documentationrequirements, uncertainty in logisticsservices, weak institutions andwidespread lack of human andproductive capacities continue to maketransport costs high. According toWorld Bank Doing Business data, thecost to export a container for LLDCshas increased from $2212 in 2005 to$3204 in 2014, compared with $1015in 2005 to $1268 in 2014 for transitdeveloping countries. Similarly, the costto import for LLDCs has increasedcomparatively more than for transitdeveloping countries. Documentationrequirements, additional delays andother excessive and cumbersomebureaucracy persist in many LLDCs. In2013, LLDCs were spending 87 per centmore time to export compared withtheir transit neighbours.

With a view to reducing economicdistance, save time and increase thereliability of logistics and supplychains, trade facilitation has become animportant trade policy instrument formany LLDCs to overcome theirgeographical disadvantage and betterintegrate in the world economy. ManyLLDCs have made efforts to implementtrade facilitation measures that reducetransaction costs and delays at border-crossing.

FACT SHEET

23SPECIAL EDITION

REGIONAL REVIEWS

As part of the preparatory processfor the comprehensive Ten-Year

Review Conference of the AlmatyProgram of Action (APoA) to be heldin November 2014, The AfricanRegional Review meeting in Ethiopiaand the Euro-Asian Regional reviewin Laos, in the year 2013, addressedthe special needs of LandlockedDeveloping Countries (LLDCs) withina new global framework for transittransport cooperation for Landlockedand Transit Developing Countries.

A study undertaken by OHRLLSnoted that the trade of LLDCs in 2010amounted to only 61 per cent of thetrade volume of coastal countries, andthat transport costs for LLDCs were45 per cent higher than those ofcoastal economies which hadincreased over time. The level ofdevelopment of LLDCs was also found

to be on average 20 per cent lowerthan it would have been, had they notbeen landlocked.

The objective of the meeting was toreview and take stock of theimplementation of the AlmatyProgram of Action at a regional levelin Africa, Asia and Europe includingidentification of the majorachievements, constraintsexperienced, emerging challengesand the opportunities presented. Themeeting also identified policymeasures and action orientedrecommendations that need to beimplemented to enable the Africanand Euro-Asian LLDCs to fullyparticipate in the global trade andrealize their full potential forsustainable and inclusivedevelopment

Recommendations from theAfrican Regional Review

The necessity for more investment inhard infrastructure is recommendedto upgrade the infrastructure fortransport, energy, and ICT,particularly broadband (to improvethe connectivity of LLDCs and thereliability of communicationsnetworks and electricity supply). Toimprove inland water transport, morefinancial and technical need andsupport from development partners isbeing taken up for consideration.

Some of the other priorities of LLDCsthat need addressing include areduction in high trade transactioncosts, enhanced productive capacities,value addition and diversification,

Trader Yassir Ahmed Mohamed at the customs office in El Geneina, West Darfur. Credit Albert González Farran, UNAMID


24 SPECIAL EDITION

reduced dependency on commodities,infrastructure improvement, supportfor regional integration and corridormanagement, increased financialresources, official developmentassistance (ODA), foreign directinvestment (FDI) and remittances,and mainstreaming their particularchallenges in the global post-2015development agenda.

Improved market access is deemedimportant for LLDCs and theinternational community is asked toconsider establishing a preferentialmarket access scheme for LLDCexports to mitigate the high tradetransaction costs stemming fromtheir geographical disadvantage.

The Review called for a balanceddistribution of aid from ODA and Aidfor Trade to African LLDCs. While sixof the African LLDCs rely on ODA forat least 20% of their centralgovernment expenditure, themajority of funds from Aid for Tradego to economic infrastructure and

reflects LLDCs renewed commitmentin addressing development gaps andintegrating their countries moreclosely with the region’s growthmomentum.

The meeting agreed that LLDCs needto make full use of the potential ofregional economic integration arisingout of increasing intra-regional tradeand intra-regional foreign directinvestment and improvingconnectivity through transport,energy and ICT networks. Euro-AsianLLDCs, which are in the process ofaccession to the World TradeOrganization (WTO), were also urgedto expedite their efforts.

The creation of comprehensive transitpolicies was advocated so that thelandlocked and transit developingcountries can establish efficienttransit transport systems. Theseinclude, for example, transportstrategies and programs,development of transit transportcorridors, improvement of majortransit transport infrastructure,development of regulatoryframeworks and greater participationof the private sector.

To improve transport infrastructure,bridging infrastructure gaps, andensuring coherent infrastructuredevelopment and planning, theLLDCs are asked to engage actively inregional cooperation initiatives suchas the United Nations SpecialProgram for the Economies of CentralAsia and institutional frameworkswhich support the adoption of theintergovernmental agreement on dryports. More specifically, Afghanistan,Armenia, Azerbaijan, Bhutan,Kazakhstan, Kyrgyzstan andTurkmenistan were requested to takemeasures towards ratification,acceptance, approval of or accessionto the Intergovernmental Agreementon the Trans-Asian Railway network,and Turkmenistan with regard to theAsian Highway Network.

The meeting suggested enhancingefforts at border crossings forimproving infrastructure facilities,inter-agency coordination andcooperation, and implementing

building productive capacity. Hence,the review stressed the need toenhance the quantity, quality andimpact of both ODA and Aid for Tradefor LLDCs.

Heavy emphasis was placed on theinclusion of private sector in thedevelopment processes. It is expectedthat public-private partnerships,could play a major role ininfrastructure rehabilitation andmaintenance if they are provided withan opportunity to participate andcontribute to the formulation ofregional and global policies and legalinstruments.

When APoA was drafted 10 yearsago, it had not identified the supportmeasures specifically targeted atLLDCs. The review focused on theimportance for specific measuressuch as special and differentialtreatment, and those measures thatapplied to least developed countriesunder WTO, to be extended to LLDCs.

Recommendations from theEuro-Asian Regional Review

The Outcome Document ‘VientianeConsensus’, adopted at the meeting,

Regional Reviews...continued from page 23

ICT tools have revolutionized the Bolivian indigenous communities who use

computers to learn more about use of natural resources.

IICD, Flickr

25SPECIAL EDITION

integrated border crossingmanagement, single stop inspectionand single window clearances, theuse of new non-intrusive inspectiontechnologies, and the application ofrisk management.

As Tourism is increasingly becomingpart of a global trade, emphasis topromote sustainable tourism wascalled for to bring in increasedinvestment (foreign exchange flows)and positive intersectoral linkages inthis sector. It was also recommendedto adopt a more systemic approach inimproving the skills of migrantworkers, reducing the transactioncosts faced by migrants andstrengthening linkages with theirmigration communities abroad inorder to attract their skills andinvestment at home. Provide a safeworking environment for migrantworkers at the receiving countriescould facilitate the efficient transferof remittances.

To promote trade capacity andenhancing trade facilitation, themeeting recommended the LLDCs togain access to WTO; take into accountand ensure that trade facilitationmeasures are consistent with existinginternational and regionalagreements, mechanisms andundertakings, and build on existinginternational standards andconvention; work together on traderelated reforms based on analysis ofnon-tariff barriers; further develop

Outcome of Latin AmericanRegional Review

Bolivia and Paraguay, the two LLDCsin Latin America, have madesignificant strides in various areas ofdevelopment in the ten years sincethe implementation of the APoA.Despite these efforts, the LatinAmerica Regional Review process forthe APoA, reported that progress inBolivia and Paraguay has not beenwithout setbacks and that the twocountries continue to be adverselyaffected by geography.

Bolivia is currently working on thefinal phase of a new general transportlaw, and there are planned projectsfor developing airport infrastructure,building a national Matacucito-Mutún-Puerto Busch rail network formineral exportation, and improvingtransport logistics infrastructure.There are also plans to pave allprimary and secondary networks andset up signaling systems onwaterways and ports.

Bolivia still faces transport challengesdue to the unreliability andinadequacy of its transportinfrastructure and the correspondingimpact on the competitiveness of its

public-private partnership (PPP)opportunities by increasing thereadiness for PPP schemes anddeveloping a conducive environmentin terms of policy formulation,regulatory reform and administrativearrangements.

To further efforts at the multilaterallevel, the need to undertake measuresto deepen regional cooperation andintegration, including through freetrade agreements, which might spurinvestment flows in terms ofefficiency-seeking regionalreconstruction was emphasized.

The meeting suggested enhancing efforts at

border crossings for improving infrastructure

facilities, inter-agency coordination and

cooperation, and implementing integrated

border crossing management, single stop

inspection and single window clearances,

the use of new non-intrusive inspection

technologies, and the application of risk

management.


Laos Border Control on Highway 9, connecting Vietnam to Laos. ADB, Flickr

26 SPECIAL EDITION

export products. Excessivebureaucracy at border crossing pointsand a lack of harmonization withneighboring countries’ customsprocedures also hampers transit.

Bolivia and Paraguay’s transitneighbors shared the view thatplanning was a vital long-term policytool, recognizing a need to developintegrated and complementaryinfrastructure, transport andlogistics policies. There were calls tointensify existing cooperation in theregion, acknowledge the significanceof Integration of RegionalInfrastructure in South America(IIRSA), which is a technical forum ofthe South American Infrastructure

addressing infrastructure shortfalls,and the possibility of using public-private financing.

The recommendations of the LatinAmerican Regional Reviewemphasized the importance ofintegrating the main points of entry(such as airports and seaports) withneighboring countries. They stressedthe importance of improving transittraffic regulations and bureaucraticpractices at border crossing points,increasing awareness of logisticalcosts and their impact ondevelopment and the sharing of bestpractices.

and Planning Council (COSIPLAN),and integrate systems for borderchecks and customs cooperation.Participants also discussed how tominimize their vulnerability toexternal factors, such as volatile foodand fuel prices, financial andeconomic crisis and climate change.

Recommendations from the regionalreview include the need for greaterproduction diversification,recognition of the service sector asone of the possible ways to diversifythe economy, and the need to enhancethe special and differential treatmentfor LLDCs in different spheres ofnegotiation. Participants alsorecognized the importance of adeepened regional integration processand the need to work towardscommon logistics and mobilitypolicies, including updating bilateraland regional legal instruments,

Regional Reviews...continued from page 25

Locomotora Ferrocarril Antofagasta Bolivia. Hernan Ferreira, Flickr

27SPECIAL EDITION

Zambia – A Case Study

by Nosh Nalavala andPriscilla Masilamani

Without direct access to the sea,landlocked developing

countries (LLDCs) find that having todo business is a lot more costly thantheir maritime neighbours. Due totheir dependence on transit countries,these landlocked nations experience aplethora of border crossings,cumbersome transit procedures,inefficient logistics systems and poorinfrastructure. Maintaining anamicable relationship with theneighboring countries does notnecessarily remove the high costfactor involved in transit.

“Trade competitiveness remains thebiggest issue the LLDCs are facing,”Dr. Mwabe P. Kasese-Bota, PermanentRepresentative of Zambia to the UnitedNations told The Commitment. Zambiais the current chair of the Group ofLLDCs. “As transport costs are high,LLDCs get to pay up to three times thecost of transportation for both importsand exports. This translates to ahigher cost of living in the LLDCscompared to their neighboring transitcountries,” she added.

Economist and interregionalconsultant Lindani Ndhlovu, in anevent organized by the UN Conferenceon Trade and Development (UNCTAD),has called on Zambia to work with itsneighbours to develop infrastructure

and reduce the cost of transport andelectricity. Addressing the issueregional linkages, Kasese-Bota noted,“One cannot address povertyreduction to the exclusion ofinfrastructure development andindustrialization.”

The participation of LLDCs in theregional and global community valuechain would help save the lives ofpeople from the poverty cycle. “Ourmajor preoccupation should be to findlasting solutions to the challenges weface through diversification of oureconomies, value-addition to thecommodities we produce, andenhancing our competitiveness which

Dr. Mwabe P. Kasese-Bota, PR of Zambia to the UN interviewed by Nosh Nalavala


Chibaula Silwamba

28 SPECIAL EDITION

will enable us to join regional andglobal value chains,” said YamfwaMukanga, Zambia’s Minister forTransport, Works, Supply andCommunications at the special eventorganized by UNCTAD. “This willinevitably call for greater cooperationin fundamental transit policies, lawsand regulations with our transitneighbors,” he added.

“Regional integration and cooperationshould be strengthened under the newconcept of developmental regionalismto develop regional infrastructurenetworks which would in turnenhance competitiveness and increase

firms appears to be power, followed byinformation and communicationstechnology and transport.

Zambia strategic location makes it animportant country for goods travelingto and from Central Africa and thePort of Durban in South Africa.Efforts are being taken by thegovernment to address transit trafficdelays along the border and also toincrease transit speed along thecorridor. Major progress in maintrunk road networks providesregional and national connectivitylinking the provincial capitals toLusaka, and to the main internationalborder crossings. Eighty percent ofroads are in good condition. Expertssuggest that providing rural roadaccess to 80% highest value

productive capacities,” Mukanga said.“Unlocking the trade potential ofLLDCs will also require theprioritization of energy supply.”

Zambia’s economy is dependent oncopper mining while 70% of thepopulation relies on agriculture. IfZambia is to improve itsinfrastructure to the level of middle-income countries in the region, itsgrowth pattern must grow by asmuch as 2.6 percent per capita.Evidence from enterprise surveyssuggest that infrastructureconstraints are responsible for about50 percent of the productivityhandicap faced by Zambian firms,with the remainder attributed to redtape and financing constraints. Themost taxing constraint on Zambian

Zambia – A Case Study...continued from page 27

Driven mainly by Zambian women entrepreneurs, over 1 million tonnes of fish from small-scale inland and coastal

fisheries trade between countries in southern Africa..

Stevie Mann, Flickr

29SPECIAL EDITION

agricultural land and urban accesswithin 500 meters of the water supplyand sanitation sector would help meetthe Millennium Development Goals.

The economy of Zambia, basedprimarily on its mineral wealth,heavily depends on the rail sector. Railtransport continues to be the mostcompetitive for large bulk, time-insensitive commodities, such asZambia’s copper production. TheRailway Systems of Zambia serves thenorth-south corridor and connectswith the Zimbabwean rail operator foronward service to the Port of Durbanwhile the Tanzania and ZambiaRailway Authority operates aneastward route from the copper beltinto Tanzania and onto Dar es Salaam.

Endowed with a relatively largeamount of cost-effective hydropower,Zambia remains fairly adequate withelectric supply. Due to the demands ofits large-scale mining sector, Zambiahas a relatively large generationcapacity and power consumption percapita, several times higher than thatof other resource-rich countries inAfrica. While power is relativelyabundant in Zambia, much of that

Ambassador Kasese-Bota anticipatesthat the outcome document of thesecond International Conference onLLDCs in Vienna would complementthe Post 2015 agenda and speak onthe structural transformation ofLLDCs. “We also expect to continue inthe spirit of multilateralism, wherethe UN Member States participate andenrich us. We also consider theparticipation of private sector as acritical factor to complementgovernment efforts.”

power goes to the mining sector,leaving less than 20% access fordomestic consumption with a largegap in rural electrification.

Strides have been made in theinformation and communicationstechnology sector where thearchitecture of the network iscurrently clustered around the maineconomic arteries with minimal reachto other areas. However due to itsgeographic handicap of beinglandlocked, Zambia faces even highercosts for internet and internationaltelecommunications than othercountries. With the plannedsubmarine cables along the east coastof Africa, and the extension ofbackbone connectivity inland, there isthe prospect of a 50 percent reductionin these charges.

The growth of ICTs has contributed tonearly 0.6 percentage points to theannual per capita growth of Zambia’sGDP over the past decade while poorperformance of the power sectorreduced the per capita growth rate by0.1 percentage point.

Railroad network running along the entire country from the north to south and from west to east connecting

neighboring countries facilitate speedy trade and transit.

Tak,Flickr

The economy of Zambia,

based primarily on its

mineral wealth, heavily

depends on the rail

sector. Rail transport

continues to be the most

competitive for large

bulk, time-insensitive

commodities, such as

copper production.

30 SPECIAL EDITION

The Second UN Conference on LLDCs:Two Years in the Planning

by Aleksi Tzatzev

Alot has changed since the 2003Almaty Programme of Action

(APoA). The average income per capitaof Landlocked Developing Countrieshas grown 3.8 per year – well abovethe global average of 1.5 percent.Since 2000, the value of merchandiseexports of LLDCs has also increasedalmost seven-fold. Nevertheless thesestates remain highly vulnerable toexternal economic shocks and climatechange, two weaknesses that theSecond UN Conference on LandlockedDeveloping Countries seeks to remedy.

From the 17 thematic meetings to thethree regional reviews and the twoambassadorial retreats, it has takenmore than two years and countlessman-hours to organize the Conference

held in Vienna. The Office of the HighRepresentative for LDCs, LLDCs, andSIDs has been designated as thesystem wide focal point for the eventand worked alongside the hostsAustria, donor countries,international agencies and others inorder to ensure a successful review ofthe 2003 APoA and a step towards thenext 10 years of development forLLDCs.

■ September 2012

Almaty, Kazakhstan hosted theFourth Meeting of Trade Ministers ofLDCs, where the attendees adopted aMinisterial Declaration, whichemphasized several issues, including:developing the productive capacities ofLLDCs and promoting investment. AHigh-Level Thematic Meeting alsoprovided recommendations on tradefacilitation and aid for trade.

■ December 2012

December saw the General Assemblyadopt Resolution 67/222, whichaddressed the specific needs andproblems of LLDCs.

■ February 2013

This month saw the Road and RailFinancing Conference as well asSecond Ministerial Conference onEuro-Asian Transport Links, held inGeneva, Switzerland.

■ March 2013

March was a busy month with theEuro-Asian Regional Review was heldin Vientiane, Lao PDR. The regionalreview was one of three to come in2013 with the objective of reviewingregional progress towards the APoAover the past decade. Also in March,

USG Acharya addresses journalists at the Noon Briefing at the United Nations in New York, May 2014.

31SPECIAL EDITION

LLDC Ambassadorial Retreat, Glen Cove, New York, May 2014.

OHRLLS-organized a BrainstormingMeeting on the Priorities for a NewAgenda for LLDCs.

■ May 2013

Beijing hosted the Global ServicesForum, where figures fromgovernments, the business world andacademia came together to promotegrowth in the trade of services andencourage sustainable development.

■ June 2013

The OHRLLS and World Bankpartnered to organize the TransportDevelopment and Trade Facilitationevent in Washington, D.C. Themeeting included the progress reviewin transit transport infrastructureand services within LLDCs.

■ July 2013

July saw the second regional reviewmeeting. The Africa Regional ReviewMeeting took place in Addis Ababa,Ethiopia, and sought to review theimplementation of the APoA in Africa.

UNOSSC and OHRLLS, whileUNCTAD organized the Expert GroupMeeting on Transport and LogisticsInnovation in Geneva.

■ November 2013

The Latin America RegionalReviewtook place in November inAsuncion, Paraguay. The last of thethree regional meetings focused onthe South American continent and theimplementation – successes, failuresand future challenges – of the APoAthere. The meeting brought togetherstakeholders in Latin AmericanLLDCs, transit countries, developmentpartners, private sector and academia.

■ February 2014

In February of this year, the OHRLLSorganized the Fourth Inter-AgencyConsultative Group meeting inGeneva. Three others were held priorto this in 2013. Attended by USGAcharya as well as ambassadors from


In Geneva, Switzerland, the OHRLLSorganized an ECOSOC side eventcalled, Renewing Global Partnershipsfor Connecting LLDCs to the WorldMarkets.

■ September 2013

Two high-profile meetings occurred inSeptember. The first one dealt with theimpacts of climate change,desertification, land degradation anddrought, and was hosted inWindhoek, Namibia. The second was aHigh-Level Conference on RoadTransport in Dushanbe, Tajikistan.

■ October 2013

October was another busy month withtwo meetings in Kenya regardingtechnology and one in Geneva ontransport logistics. Nairobi hosted thelaunch of the South-South TechnologyTransfer Facility for LLDCs as well asan event on enhancing ICTDevelopment and Connectivity forLLDCs. The launch of the South-South Facility was co-hosted by

32 SPECIAL EDITION

initiator of the process, is interested inthe success of the meeting. That’s whywe organized this retreat,”Idrissovsaid.

■ September, October 2014

The last two months have included thefinal preparations for the LLDCConference in Vienna, including theinvitation of participants, both fromthe private and public sectors.OHRLLS, the Austrian Governmentand support agencies worked togetherto ensure smooth operations in Viennaand a high-level meeting oninvestment in LLDCs organized byOHRLLS and UNCTAD in Geneva.Among the outreach programs, theOHRLLS organized a photo call foramateur and professionalphotographers to submit their shotsfrom LLDCs to be exhibited in Viennaand published on the LLDC website.Some of these photos are also found inthis magazine.

The beginning of October alsoincluded the Second PreparatoryCommittee Meeting for the 2nd UNConference on Landlocked DevelopingCountries. This was one of the laststeps leading up to the conference inVienna. USG Acharya addressedlogistics as well as his hopes for theconference in shaping the Post 2015agenda of LLDCs.

Effective monitoring and reviewemerged as an important point of anyfuture LLDC conference. Ultimatelythe representatives pointed the Post2015 Development Agenda toward amore holistic plan of action withaccountability being a major factor ineffectiveness. This month OHRLLSalso organized a half day thematicdiscussion on the vulnerability ofLLDCs to external shocks.

■ July 2014

The second ambassadorial retreat tookplace in Almaty, Kazakhstan, afamiliar place for LLDC discussions.The draft of the Outcome Documenthad its roots in this conference ofambassadors and delegates. Amongthe attendees were Kazakh ForeignMinister ErlanIdrissov, HighRepresentative Gyan ChandraAcharya and representatives ofinternational agencies such asUNCTAD and WTO. A topic ofdiscussion was the review of theAPoA. “It is gratifying that thisdocument made it into the history ofthe UN and today we are activelypreparing for the second UnitedNations conference for acomprehensive ten-year review of theimplementation of the APA inaccordance with General Assemblyresolution 66/214. Kazakhstan, as the

The Second UN Conferenceon LLDCs...continued from page 31

Lao DPR and Paraguay, amongothers, the meeting addressed theneed for building the productivecapacities of LLDCs. In particular,participants spoke about theimportance of regional value chainsand the need for product and tradediversification.

■ April 2014

In April the UN General Assembly,with Resolution 68/270, acceptedAustria’s bid to host the Second LLDCConference, setting the time as 3-5November and venue in Vienna.

■ May 2014

New York hosted the first of twoambassadorial retreats on 9-10 May.The meeting was attended by 55participants that includedambassadors and permanentrepresentatives from LLDCs, transitdeveloping countries, donor states andexperts from the UN system.Participants came to the conclusionthat the APoA did not do enough toaddress growth factors such aseconomic diversification,industrialization and job creation.

Since 2000, in current terms, the value of merchandise exports

of LLDCs has also increased almost six-fold. Nevertheless these

states remain highly vulnerable to external economic shocks and

climate change, two weaknesses that the Second UN Conference

on Landlocked Developing Countries seeks to remedy.

33SPECIAL EDITION

Anew report published by UN-OHRLLS underscores

how the landlocked developingcountries (LLDCs) are impacted bya number of external shocks,including economic, socio-political,and climate change and naturaldisasters.

The 84-page publication arguesthat measures should beundertaken to strengthen resilienceat the national and householdlevels, build bulwarks to managepost-shock impact, and finally,establish and strengthen thefunctioning of core institutions.

It also highlights a number of therecommendations for LLDCs andtheir development partners toundertake. The group of LLDCs areencouraged to diversify productionand export markets across multiplefronts. Diversification, the report

The Vulnerability of LandlockedDeveloping Countries to ExternalShocks

BOOK REVIEW

New report published by UN-OHRLLS,

The Vulnerability of Landlocked Developing

Countries to External Shocks.

says, represents a pragmatic meansof spreading risk. In particular,LLDCs must undertake investmentand policy re-orientation that wouldcreate other productive sectorscapable of supporting economicgrowth in tandem with the existingfew commodities or minerals.

Closely related to but different fromdiversification, LLDCs would dowell to pursue economictransformation, which implies asubstantive reorganization of theeconomy, its actors and how theyinteract. Economic transformationmay include deliberate efforts topromote industrial developmentand value addition, transitioningfrom the low-productive informalsector to more efficient productionarrangements that have strongback and front linkages, and thatcan support rapid and inclusivegrowth, as well as job creation, thereport underscores.

There is also a need to developsafety nets both at the national andhousehold levels that could beutilized when external shocks hit.For LLDC governments, this mayinclude pursuing sound fiscal andmonetary policies that would createbudget surpluses and robustinternational reserve holdings.There is also a need to havetargeted and strategic socialprotection mechanisms. At thehousehold level, this may includeholding additional liquid assets andfood stocks in case of sharpincreases in prices, or extremeweather.

Often times, external shocks can bemitigated by local solutions. LLDCsmust accelerate efforts to develop

and strengthen their economies tosupport a growing domesticdemand, the report says.

The publication calls ondevelopment partners to coordinatetheir responses. The 2007 financialand economic crisis provided freshimpetus for the need to promoteclose intergovernmental efforts forjoint-response to external shocks.While such efforts at theinternational level are crucial, it isequally important that coordinationis achieved at the regional and sub-regional level. Further, theinternational community cansupport LLDCs through thecreation of a special insurancescheme that covers external shocks..

The report concludes that all theLLDCs are vulnerable to externalshocks of one kind or another. Inview of this reality, it is necessarythat the Post 2015 developmentagenda and the 10-year review ofthe Almaty Programme of Actionfully reflect this problem. Thereport concurs with views that thefuture development programme forthe LLDCs must go beyond thenarrow and thematic focus ontransport and transit challenges. It needs to be comprehensive andholistic in nature, taking intoaccount emerging issues thatinclude the developmentalchallenges that stem from externalshocks.

34 SPECIAL EDITION

The DevelopmentEconomics ofLandlockedness

Areport produced by UN-OHRLLStitled “The Development

Economics of Landlockedness:Understanding the development costsof being landlocked” analyses theimpact of landlockedness on thedevelopment prospects of landlockeddeveloping countries (LLDCs) andbased on the findings, proposesrecommendations that can provide amore holistic strategy to thedevelopment of LLDCs.

The LLDCs face special challengesthat are associated with their lack ofdirect territorial access to the sea,remoteness and isolation from worldmarkets. Their seaborne tradeunavoidably depends on transitthrough other countries therebymaking them dependent on thepolitical stability, infrastructure andinstitutional quality of coastal transitcountries. Additional border crossingsand the long distance from majormarkets, coupled with cumbersometransit procedures and inadequateinfrastructure, substantially increasethe total expenses for the transportservices and other transaction coststhat erode the competitive edge oflandlocked developing countries. As aresult the LLDCs are disadvantagedfrom fully utilizing trade for theirdevelopment.

The report first uses descriptiveanalysis to identify a few simplestylized facts to help understand thesort of challenges that LLDCscurrently face when compared to the

other groups of countries for keyeconomic, institutional, and socialindicators. The study findings showthat LLDCs lag significantly behindcoastal developing countries andtransit developing countries in manyof the development indicators. Theyhave the lowest GDP per capita whencompared to all the other groups -transit developing, all developing,developed, and the world.

With regard to infrastructuredevelopment, the percentage of pavedroads for LLDCs is lower than that oftransit developing countries and lessthan half of the developed countries.The logistics performance in LLDCs isgenerally worse than in other groupsof countries.

Although progress has been achievedin addressing the non-physicalbarriers – soft infrastructure, theLLDCs still take almost double thenumber of days that transitdeveloping countries take to importand export. LLDCs also continue toincur high transport and tradetransaction costs. According to thestudy, on average LLDCs havetransport costs that are up to 45%higher than a representative coastaleconomy. International trade is moredifficult and expensive in LLDCs thanin any other group. Delays to exportare also significantly longer in LLDCsthan in other groups.

Although, the total trade comprisingboth exports and imports from LLDCsincreased since 2003. The exportstructure of LLDCs is generally lessdiversified and they tend to rely on theexport of primary commodities moreheavily than any other group. Tosome extent, this lack of exportdiversification is associated with arelatively small share ofmanufacturing in GDP.

On the social development front,LLDCs have experienced a positive

trend in the Human DevelopmentIndex between 2003 and 2011 –nevertheless half of the LLDCs are stillin the lowest HDI ranking. The LLDCstend to have worse health outcomesand higher poverty headcount thanthe other groups. Overall humandevelopment is still lower inlandlocked developing countries thanin the average developing country.

Assessment of costs of beinglandlocked

The report then used econometricmethods to estimate the totaldevelopment cost (including economicand social dimensions) of beinglandlocked. The empirical evidenceindicates that being landlocked is afundamental obstacle to development.The analysis quantifies thedevelopment cost of landlockedness asthe percentage decrease indevelopment due to landlockedness.This percentage averages around 20%-25%, meaning that because oflandlockedness the level ofdevelopment in the LLDCs is onaverage 20% lower than what it wouldhave been if the countries were notlandlocked. Individual countryestimates show that the range ofdevelopment costs for landlockeddeveloping countries goes from 10%to 30%.

Therefore, the attention that is beinggiven to the special development needsof LLDCs is fully justified.

Recommendations

The report suggests a set of specificrecommendations for the variousactors and stakeholders to support thedevelopment of LLDCs. Some of theactions recommended for LLDCsinclude: increasing value addition totheir exports, fosteringindustrialization, strengthening of

35SPECIAL EDITION

sector should work with thegovernments to promoteinfrastructure developmentparticularly through PPPs. The reportalso underscores that the UN System,international and regionalorganizations should play a major roleto support the LLDCs particularly inthe areas of their strength and act asfacilitators in bringing the differentparties together. They should providetechnical assistance, policy advice,mobilize support from theinternational community and supportregional integration efforts.

institutions, improve trade facilitationand intensive mobilisation of domesticand foreign resources to financeinvestments in infrastructures. Someof the actions recommended fortransit developing countries include:to establish and effectively implementtransit agreements with LLDCs, toundertake reforms to improve tradefacilitation in particular to agree toshare harmonized paperwork andprocedures and to make use ofinformation technology to exchangeshipping documentation.

The report recommends that donorsshould increase their support towardsaid-for-trade and official developmentassistance so that LLDCs couldimprove their transit corridors,productive capacities andcompetitiveness. Donors were alsoencouraged to increase funding forstudents’ exchange programmes,scientific collaboration withinstitutions in LLDCs, and generalhuman capital formation and transferof technology.

The report stresses that the private

Nurturing BusinessGrowth in NigerBrigitte Dumont, ChiefOfficer of CorporateSocial Responsibility atFrance Telecom-Orangetalks to The Commitment.

In May this year OrangeTelecommunications launched, whatis known in Niger as an incubatorproject, a large public private allianceto support entrepreneurship, startupsand Small Medium Enterprises(SMEs).

From their office in Niamey, Niger amanagement team provides businesshelp and support to resident SMEs inICT, Green Energy and theEnvironment. This incubator, namedCIPMEN, also aims to support theemergence of new economic modelsand new business segments, as wellas widening markets for localcompanies, and as such, plays a keyrole in driving and energising theselocal sectors.

The Commitment How do smalland medium sized businesses benefitfrom CIPMEN?

Brigitte Dumont The incubatoroffered an opportunity for SMEs tointegrate in the community and to

benefit from all the training andbusiness development servicesoffered by the project, includingoffice space. Another advantage ofbenefitting from an incubator is tocreate collaboration between startups.

TC Nearly 85% of all smallbusinesses fail in sub-Saharan Africa.How will your new initiatives helpthem get through the inceptionperiod?

BD The incubation period lasts for 3 to 4 years and our target, based onpast experience, is to achieve morethan 90% resilience for the SMEs thatwe are supporting during this timeframe. However, as the selectionprocess is quite demanding, whichmeans that we generally work withthe best projects and which keeps thefailure rates lower.

TC Will this initiative help generatejobs and reduce unemployment?

BD Though the job creation will notbe massive — around 500 to 1000 in10 years for the Niger incubatoralone, they are important as the jobsare skilled positions. Furthermorethe incubator creates a strongdynamic around entrepreneurshipand pushes many young people tocreate their own businesses. Itinspires hope for the unemployed

Brigitte Dumont, Chief Officer of Corporate Social

Responsibility at France Telecom-Orange.


36 SPECIAL EDITION

TC One of the goals of CIPMEN isto generate renewable energy. Howdo you plan to go about assisting incutting carbon emissions andtransitioning to renewable energy incountries that have traditionally usedcoal?

BD The CIPMEN is an SMEincubator and therefore it will notcontribute to the carbon emissionreduction issues itself; however, theincubated SMEs working onrenewable energy projects willdefinitely contribute to this objective.The first issue for us is how to helpthem succeed in their business.Renewable Energy projects arecapital intensive and therefore weneed to work out the access tofinancial mechanisms and the propermeans of accessing financialecosystems. It is very important towork with global actors who willbring to local SMEs state-of-the-artknow-how and proper businessmodels.

zones. We also support the launch ofvalue-added services to meet a rangeof needs in areas as diverse as health,education, agriculture, financialservices and administration andsupport innovation in local eco-systems.

TC That goes towards thenarrowing of the digital divide?

BD Yes, in our fight against thegeographic digital divide, we arecontinually investing to extend thecoverage of our fixed and mobilenetworks, developing innovativetechnical and commercial solutionsso that our services can reach themost isolated population. Thisinvolves active participation in largeconstruction projects for submarinecables, the deployment of 3Gnetworks– but also implementinginnovative solutions such as solarradio stations or community phonesto provide collective Internet andmobile telephony access to the mostisolated rural zones.

Nurturing Business Growth in Niger...continued from page 35

and supports a qualified younggeneration to enter the labourmarket.

TC You have indicated that yourinitiative will assist with the growthof ICTs. Could you explain how andto what extent it will boost theireconomy?

BD Today, there are very few ICTcompanies operating in the Nigerianmarket. With the incubator, we aimto grow this number by two or morein ten years’ time and that is a greatcontribution to the local ICT market.

TC Is Orange taking the lead inareas of environment and climatechange in developing countries?

BD At Orange we believe that ICTand data management can be astrong support to the emergence ofprojects and new models addressingthese key environmental issues. Wehope that the incubation process willfurther demonstrate this. Moreover,within our operations we developawareness programmes to facilitatecollection of WEEE (Waste Electronicand Electrical Equipment), such asmobile handsets, and we alsopromote proper recycling channels.We send tons of WEEE and batteriesto France for treatment processing.Orange has also chosen to developsolar power stations (vs fuel) to bringcommunications in rural areas,especially in African countries whereOrange operates.

TC Do you have specific initiativesin landlocked developed countries?Are you working on similar projectsin other countries in Africa?

BD Even if they are not specific tolandlocked developed countries, theseinitiatives are illustrations of astructured programme called Orangefor Development which focuses ondevelopment of infrastructures andconnectivity, accessibility to ICTs fora greater number of people,particularly in rural or isolated

The new CIPMEN centre in Niger is opened. Orange

37SPECIAL EDITION

• A sub-section dedicated to theBusiness and Investment Forumplanned to take place on the sidelines of the conference

The LLDC Conference will provideMember States, private sector, civilsociety and experts an invaluableopportunity to formulate anambitious action-plan tailored to the specific needs of this group ofcountries that are disadvantaged by geography.

Of the 32 countries classified aslandlocked developing, 16 arelocated in Africa, 10 in Asia, 4 inEurope and 2 in Latin America.Lack of territorial access to the sea,remoteness from markets,cumbersome transit procedures, andpoor infrastructure have a directnegative impact on economicgrowth and hamper sustainabledevelopment efforts.

In preparation for the SecondInternational Conference on

Landlocked Developing Countries(LLDCs) the UN Office of the HighRepresentative for LDCs, LLDCs andSIDS (UN-OHRLLS) launched awebsite dedicated to theinternational gathering. The websitehas proven to be an important toolin our outreach and advocacyefforts to provide all stakeholderswith comprehensive up-to-dateinformation in the lead-up to andduring the global meeting

You are invited to browse the site at http://www.lldc2conference.orgfor the latest information onconference proceedings.

Summary of features:

A news stream on the home pageproviding visitors with timely, easy-to-read information affectinglandlocked developing countries

• Several pages explaining theintergovernmental process in aclear and concise manner

Website for Second United NationsConference on LandlockedDeveloping Countries

Screen capture of the website dedicated to

the Second United Nations Conference on

Landlocked Developing Countries (LLDCs)

3-5 November 2014 in Vienna, Austria.

38 SPECIAL EDITION

LLDCs • 32 Landlocked Developing Countries

dispersed across four continents.

• Africa (16); Europe (4); Asia (10), andLatin America (2).

Population • Combined population of 453.5 million.

• 72% live in rural areas.

• 3.8% live in urban areas.

Social Development• Average primary school enrollment

increased from 64% in 2000 to 83% in2011.

• Share of women in parliamentincreased from 12.1% in 2000 to 20.2%in 2012.

• Average adult HIV prevalence rate inLLDCs (ages 15-49) decreased from 4%in 2001 to 2.8% in 2011.

• Under-5 mortality rate for LLDCsdeclined from 109.5 per 1,000 livebirths in 2000 to 80.9 in 2011.

• The female-male ratio in labour forcefor LLDCs was 0.79 in 2011.

Geography • Average distance to the nearest seaport

for LLDCs is 1,370 km – which issubstantially vast when compared toindustrialized economies, such as thosein Europe which face 170 km to thenearest port.

Landlocked Developing CountriesFACT SHEET

• Kazakhstan (3,750 km) and Kyrgyzstan(3,600 km) have the longest distancesfrom the sea, while Moldova (170 km)and Swaziland (193 km) have theshortest.

Transit and Distance Difficulties• Days that LLDCs take to import has

decreased from 57 in 2006 to 47 in2014 and export days have reducedfrom 49 to 42 over the same period.LLDCs still require almost twice thenumber of days to import and exportwhen compared to transit countries.

International Trade Performance• In 2012, trade was 78% of GDP – much

higher than the global average of 61%

• Total exports of goods and services arein excess of $ 280 billion.

• Share of global trade hovers around1.2%.

WTO Accession 24 LLDCs have acceded to the WorldTrade Organization and participate inmultilateral trade negotiations as full-fledged members.

ICT Infrastructure • Mobile telephony has increased from

2.3 mobile phones per 100 people in2000, to 60.7 in 2012.

• Internet use has increased from lessthan 1 person to about 13 per 100individuals.

• Transit developing countries have more

than twice the number of landlines for100 people.

Road, Railway and Air Transport• Only 9 countries have greater than 50%

of their roads paved.

• Transit developing countries haveincreased their share of paved roads atan annual rate of around 8% per year,compared to LLDCs’ 2.9%.

• Seven LLDCs do not have a railroad,and missing links are a major problem.

Sustainable Energy• Less than 44% of people in LLDCs have

access to electricity.

• While about 74% of people in theLLDCs’ urban areas have access toelectricity, the number is much lower forrural populations, which stood at 33%.

Official Development Assistance• LLDCs net official development

assistance receipts stood at US$ 27.5billion in 20121 – a substantial increasefrom US$ 16.6 billion in 2003.

• ODA remains an important contributorto gross capital formation in sixcountries where it accounts for morethan 50%.

Foreign Direct Investment• From US$ 8.9 billion in 2003, FDI

inflows reached US$ 34.6 billion in2012. Since 2009, just 3 countries havereceived nearly 60% of all FDI disbursedto the group.

39SPECIAL EDITION

Development Assistance and Financial Flows to LLDCs

Lack of adequate financial resourcesand productive capacities are some ofthe biggest constraints facingLandlocked Developing Countries(LLDCs) in their efforts to achievesustained growth and sustainabledevelopment. The support ofdevelopment partners, emergingcountries, private actors, as well as UNand other international organizationsis crucial to complement LLDCs’ ownefforts towards the establishment andmaintenance of effective transittransport systems, integration into theworld economy and structuraltransformation of their economies.

Official Development Assistance(ODA)The effects of the global economic crisishave caused stagnation in officialdevelopment assistance (ODA) fromOECD countries. Following realincreases in ODA flows to LLDCs since2003, ODA fell slightly in 2010, largelylevelled off in 2011 and increased onlymarginally in 2012.

More than half of LLDCs (18 out of 32)experienced a real fall in their ODAreceipts in 2012. This decrease in aidcould threaten developmentexpenditures in many aid-dependentLLDCs.

Allocation of ODA varies greatlyamongst LLDCs. For instance, sixcountries received 55% of the total ODAflows to LLDCs in 2012. A moreequitable distribution of ODA based oncountry-specific priorities.

Aid for TradeAid for Trade plays an essential role incapacitybuilding in LLDCs in the areas

of development and maintaining oftrade-related infrastructure,implementation of trade facilitationmeasures and formulation of tradepolicies, with a view to increasingvalue-addition and marketcompetiveness of their export products.Aid for Trade, in combination withcomplementary policies, hascontributed to improved infrastructure,lowering of trade costs, better borderinstitutions and regulatory proceduresand enhanced capacities. The regionalnature of Aid for Trade programmealso promotes international tradeintegration.

LLDC receipts of Aid for Trade havealmost doubled in real terms between2002 and 2005. However, Aid for Tradecontracted from $6.5 billion in 2011 to$6.3 billion in 2012. The Aid for Tradeinflows in 2012 were mainlyconcentrated in three sectors:Transport and Storage (33%),Agriculture (28%) and Energy (18%),which added up to 79% of the totalamount.

Foreign Direct Investment (FDI)FDI is the major proportion of privatecapital flows that is considered as themore stable foreign investment. FDIhas the potential to enhance economicdevelopment in LLDCs through jobcreation, improving managementsystem, transfer of skills, technologyand business processes. FDI is alsoessential to local infrastructure andcapacity building. Enabling policyenvironment, at the international andnational level, is crucial in promotingattraction of more sustainable anddiversified foreign direct investment.

FDI inflows to LLDCs amounted to$34.6 billion in 2012, more than fourtimes the amount in 2003. LLDCs alsomanaged to avoid a fall in their FDIinflows immediately following theglobal crisis. However, compared totransit countries, LLDCs only receivedone tenth of the amount in this inflowin 2012. The majority of LLDCs do notattract sufficient FDI to accelerate theireconomic development. Only about 18%of FDI inflows to LLDCs went to theleast developed landlocked countries.

South-South and TriangularAssistance and CooperationSupport from South-South andtriangular partners, in the form offinancial and technical assistance, as well as diversified tradingopportunities, technology transfer andsharing of best practices, has becomeincreasingly important for LLDCs. For example, global South-Southcooperation, especially assistance fromIndia and China accounted for 41% ofFDI to LLDCs in 2011.

Moreover, LLDCs’ trade with the globalSouth has deepened as 17 out of 32LLDCs exported more than 50% of theirproducts to Global South countries.Strengthened South-South andtriangular cooperation in particular inthe area of transit transportcooperation, development of productivecapacity and greater integration ofLLDCs into the world economy, has animportant complementary role to playin supporting sustainable growth anddevelopment in LLDCs.

FACT SHEET

40 SPECIAL EDITION

A Song from the CentralAfrican Republicby Louise Stoddard

As the international communitymeets in Vienna this November

for the LLDC2 Conference, 100,000film goers will flock to the Austriancapital for a two week programmeviewing festival. Since 1960 theVienna International Film Festival(Viennale) has featured films from all over the world and this year, inpartnership with the United Nations,is screening a film from the CentralAfrican Republic – A Song from theForest. The film will be shown on theTuesday 4 November followed by Q & A discussion.

“We wanted to showcase the best oflandlocked developing countrieswhilst we are in Vienna and couldn’tpass up the opportunity to join forceswith the Viennale to highlight the artsand culture that come from countriessuch as Central African Republic,”said Louise Stoddard, PublicInformation Officer at OHRLLS. “This film is about a journey. Itexamines the questions anduncertainties that we all face when we consider the future, but it alsocelebrates the unique cultural detailsthat are woven into the generations ofa landlocked community for a time,but which shift and alter as the worldaround them changes,” she added.

Link to the film trailer:http://songfromtheforest.com/

Link to the Viennale:http://www.viennale.at/en

About the film:

As a young man, American Louis Sarno heard a song on the radio thatgripped his imagination. He followed the sound all the way to the CentralAfrican rainforest, where he found the music’s origin with a tribe of huntersand gatherers, the Bayaka pygmies – and he never came back. Now, 25 yearslater, Louis lives as one of them, speaks the Bayaka’s language and is raisinghis pygmy son, Samedi. Over the years he has collected over 1,000 hours ofunique recordings of Bayaka music, which he recently donated to the PittRivers Museum in Oxford, England. Many years ago, when newborn Samedibecame gravely ill, Louis promised to show him where he came from. Nowthe time has come to fulfill this promise, and Louis takes 13-year-old Samedion a journey to the world he left behind in the United States.

Linking Landlocked Countries to Global...

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