The Bound Tariffs Database
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1 The Bound Tariffs Database CEPII Working Paper Binding overhang and tariff-cutting formulas Mohamed Hedi BCHIR, Sébastien JEAN and David LABORDE (CEPII)
2 MOTIVATIONS To analyse the real impact of tariff reduction. Bound >= MFN (applied) >= applied (preferential) New Applied rate = Min [New Bound rate, Current protection] I II III Bound level Binding overhang MFN Preferential Margins Applied
3 SCOPE Build a database of AVE bound duties at the HS6 product level, for all WTO members and all products Fully comparable with the Applied AVE database MAcMap (consistant methology, conversion) => allow cross-checking Sources: WTO's Consolidated Tariff Schedules + National sources
4 Previous Works Bacchetta-Bora (2001,2003): detailed and complete database but only industrial products are covered and without AVE. ERS-USDA database: MFN and Bound tariffs post UR, 120 countries but only agricultural products and preferences only for US and EU, simple average. ITAS (Australian Productivity Commission): Harmonised information for applied and bound but for non agricultural products and 19 countries.
5 Calculating AVE bound tariffs (1) Definition of consolidation at the HS6 level when notification at a more detailed level Agricultural products: considered as bound (except for well identified exceptions) Check on the HS nomenclature used for notification and applying protection. Difference => HS6 product is bound Same nomenclature but difference between the number of tariff lines registered: HS6 product unbound (but keeping the information on the ratio tariff lines unbound/bound) if average bound tariff < MFN bound tariffs at the HS6 level.
6 Calculating AVE bound tariffs (2) For the sake of homogeneity, same methodology that in MAcMap ( Bouët and ali. 2004) Treatment of Mixed tariffs: Priority to ad-valorem term. AVE computation: world unit value Cleaning phase: Comparison between AVE MFN from MAcMap and AVE Bound for If MFN > Bound: special treatment. => Harmonised database in HS6 Rev1 with AVE Bound tariffs for 147 countries and 5113 products
7 Illustrations
8 Distribution of AVE Bound Tariffs 100% Agricultural products Dvped Co. 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Australia Canada EFTA European Union Japan USA Share of products bound duty-free Share of products with AVE bound in [0%;30[ Share of products with AVE bound in [30%;100%[ Share of products with AVE bound>100%
9 Distribution of AVE Bound Tariffs Agricultural products Dvping Co. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% ASEAN China India Korea Maghreb Mercosur Bangladesh OthSSA Pakistan SACU SSA_LDC Share of products bound duty-free Share of products with AVE bound in [0%;30[ Share of products with AVE bound in [30%;100%[ Share of products with AVE bound>100%
10 50.0 Binding Overhang in Developed Countries USA Canada Japan Australia European Union EFTA AVE binding overhang for Agricultural products AVE binding overhang Non-agricultural products
11 Binding Overhang 50.0 in Developing Countries China Korea Mercosur Maghreb SACU ASEAN SSA_LDC India Pakistan Bangladesh AVE binding overhang for Agricultural products AVE binding overhang Non-agricultural products
12 Application
13 Initial Base Rate and Applied Rate Dvped Dvping LDCs WTO For every zone, the first bar gives the inital base rate and the second one the applied rate.
14 Impact of the Harbinson proposal Reduction Final Rate Dvped Dvping LDCs WTO
15 Common Mistakes Additional Error from Cutting Applied tariffs Error from cutting applied MFN Effective Cut 60.0 Initial applied rate Australia Canada EFTA EU-25 Japan USA ASEAN India Korea Maghreb Mercosur OthSSA SACU Bangladesh
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