International Trade in Services.pdf - DSpace at Khazar University

Market Structure, Liberalization, and Trade 145
(start-up formalities, the need for authorization to sell certain products, and
restrictions on the size of larger stores), regulations on operation (opening
hours, involvement in sectoral bodies, local monopolies), and price regulation
(Boylaud 2000).
Global sales through modern retail formats are estimated to have grown more
rapidly than total retail sales; they accounted for 52 percent of total retail sales in
2006. The share differs widely across countries: 1 percent in Pakistan, 4 percent in
India, 20 percent in China and Indonesia, 22 percent in Vietnam, 35 percent in the
Philippines, 36 percent in Brazil, 40 percent in Thailand, 55 percent in Malaysia,
and 80 percent in economies of the Organisation for Economic Co-operation and
Development (OECD) (Joseph et al. 2008). In the least developed countries and in
most developing countries, retail sales are primarily dominated by small familyrun
neighborhood shops and open markets that are frequently large covered clusters
of outlets. Box 5.3 presents selected developing-country experiences in the
distribution sector.
In developing countries, modern retailing occurred in three broad waves. It
started in the early 1990s in South America (Argentina, Brazil, and Chile), East Asia
(Maldives; the Republic of Korea; the Philippines; Taiwan, China; and Thailand)
and South Africa. It then took off in Central America, Indonesia, and Mexico in
the late 1990s, before reaching some Central and South American countries,
China, India, Kenya, the Russian Federation, and Vietnam in the early 2000s.
China, India, and Russia lagged because of severe restrictions on inward FDI in
the retailing sector (Joseph et al. 2008). For large emerging markets, it is likely that
the pattern of development will follow that of the distribution sector in developed
countries, and that the pace of development will depend to a large extent on the
level of market access for foreign participation. There will be increasing concentration
through mergers and acquisitions and some vertical integration in which
retailers control both the traditional wholesale function and, in some cases, food
processing and production. This vertical integration may extend to the road
transport fleets owned by the largest retail chains, whose trucks often form part of
the storage capacity in lean supply chains.
Other impacts may affect social exclusion, raising the need for the provision of
social spending and safety nets within overall budgetary limits. This might cover
training in management, logistics, and information technology skills and training
for alternative employment among those people displaced from small traditional
outlets. Other factors that should be borne in mind are the propensity of people to
migrate, the eradication of extreme poverty and hunger, the promotion of gender
equality and the empowerment of women, and ensuring environmental sustainability
(Arkell and Johnson 2005).