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Myanmar's cross-border trade with China : beyond informal trade

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  • Kubo, Koji

Abstract

Myanmar's trade with China is heavily concentrated in cross-border trade through the Yunnan province of China. In this qualitative analysis, we examine factors that yield such a concentration from the viewpoint that trade would be concentrated in the channel where transaction costs are relatively low compared with those in other channels. It is almost certain that weak law enforcement at the border gives rise to informal cross-border trade, which allows traders to save the time and costs for compliance with formal procedures. Apart from informality, unique institutional arrangements have been emerging spontaneously in the border area that can reduce transaction costs in a way compatible with formal trade, thus augmenting cross-border trade. Based on observations of thriving trade at Myanmar's border with China, we draw implications for the country's general trade facilitation measures.

Suggested Citation

  • Kubo, Koji, 2016. "Myanmar's cross-border trade with China : beyond informal trade," IDE Discussion Papers 625, Institute of Developing Economies, Japan External Trade Organization(JETRO).
  • Handle: RePEc:jet:dpaper:dpaper625
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    References listed on IDEAS

    as
    1. Rafael La Porta & Andrei Shleifer, 2014. "Informality and Development," Journal of Economic Perspectives, American Economic Association, vol. 28(3), pages 109-126, Summer.
    2. Olivier J. Walther, 2015. "Business, Brokers and Borders: The Structure of West African Trade Networks," Journal of Development Studies, Taylor & Francis Journals, vol. 51(5), pages 603-620, May.
    3. Kubo, Koji, 2012. "Trade policies and trade mis-reporting in Myanmar," IDE Discussion Papers 326, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    4. Thiyam Bharat Singh, 2007. "India's Border Trade with Its Neighbouring Countries with Special Reference to Myanmar," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 1(4), pages 359-382, December.
    5. Jayant Menon, 1998. "Laos in the ASEAN Free Trade Area: Trade, Revenue and Investment Implications," Asia Pacific Economic Papers 276, Australia-Japan Research Centre, Crawford School of Public Policy, The Australian National University.
    6. Sanjib Pohit & Nisha Taneja, 2003. "India's Informal Trade with Bangladesh: A Qualitative Assessment," The World Economy, Wiley Blackwell, vol. 26(8), pages 1187-1214, August.
    7. Caroline Lesser & Evdokia Moisé-Leeman, 2009. "Informal Cross-Border Trade and Trade Facilitation Reform in Sub-Saharan Africa," OECD Trade Policy Papers 86, OECD Publishing.
    8. Coxhead, Ian, 2007. "A New Resource Curse? Impacts of China's Boom on Comparative Advantage and Resource Dependence in Southeast Asia," World Development, Elsevier, vol. 35(7), pages 1099-1119, July.
    9. Sandra Poncet, 2006. "Economic Integration of Yunnan with the Greater Mekong Subregion ," Asian Economic Journal, East Asian Economic Association, vol. 20(3), pages 303-317, September.
    10. repec:wsi:ceprxx:v:03:y:2014:i:01:n:s1793969014500034 is not listed on IDEAS
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    O17 - Formal and Informal Sectors; O53 - Asia including Middle East; International trade; Informal sector; Myanmar; Cross-border trade; Informal trade; Transaction costs of trade;

    JEL classification:

    • F19 - International Economics - - Trade - - - Other

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