72558 v1 World Trade Indicators 2009/10 Chad Trade Brief Trade Policy driven by low barriers for its non-agricultural exports (0.1 percent), which are dominated by oil exports. Its As a member of the Economic and Monetary agricultural exports face a considerably more Community of Central Africa (CEMAC), Chad restrictive tariff of 10.8 percent. The country’s adopted the group’s Common External Tariff (CET) currency, the CFA franc, which is pegged to the euro, in 1993. The CEMAC CET rates are generally higher appreciated by 7 percent against the U.S. dollar in than those of other countries in the Sub-Saharan 2008, making the country’s exports more expensive in Africa (SSA) region as reflected by Chad’s 2007 foreign currency terms. average MFN applied tariff of 17.9 percent, which is above both the SSA and low-income country group As negotiations between the Central Africa group, to averages of 12.2 percent and 12.5 percent, respectively. which Chad belongs, and the EU towards a full Based on the MFN applied tariff, it ranks 165th out of Economic Partnership Agreement (EPA) could not be 181 countries (where 1st is least restrictive). The cotton completed prior to the December 2007 deadline, the sector, the second most important export sector after preferences under the Cotonou Agreement elapsed. the oil sector, has been in deep crisis since 1997, Chad, however, maintains a similar level of making Chad one of the smallest cotton producers in preferences to the EU market under the “Everything the franc zone today, whereas it had been the largest But Arms� (EBA) initiative for least developed producer in the 1970s. The government is attempting countries. The country continues to negotiate an EPA to revive the cotton sector, with high tariff protection with the EU as part of the Central Africa group. for the country’s agricultural sector at 21.9 percent compared to the lower tariff protection of 17.3 percent for the non-agricultural sector. In line with the Behind the Border Constraints CEMAC’s CET, Chad applies a maximum MFN tariff Regarding its business environment, Chad remained (excluding alcohol and tobacco) of 30 percent on among the lowest ranked on the Ease of Doing imports. Its trade policy space, as measured by the Business Index, with a rank of 178th out of 183 wedge between bound and applied tariffs (the countries in 2009. With respect to trade facilitation, overhang), was 58.6 percent in 2007. Regarding its which is measured by the Logistics Performance Index commitment to liberalizing services trade, Chad ranks (LPI), Chad trails its SSA and low-income 139th (out of 148) on the GATS Commitments Index. comparators. Chad’s score on the LPI is 1.98, on a scale of 1 to 5, compared to the average scores of 2.35 for Sub-Saharan African countries and 2.29 for low- External Environment income countries. It ranks 142nd (out of 150) in the Chad enjoys very favorable market access, as indicated world and 36th (out of 39) in the SSA region (with by the low weighted average tariff (including South Africa leading the regional group). Its strongest preferences) of 0.6 percent imposed by the rest of the performance on the LPI is in reducing domestic world on its exports. This favorable rate is largely logistics costs while its weakest performance is in the quality of transport and IT infrastructure for logistics. Unless otherwise indicated, all data are as of August 2009 Trade Outcomes and are drawn from the World Trade Indicators 2009/10 Database. The database, Country Trade Briefs and Real trade (in constant 2000 US dollars) was unable to Trade-at-a-Glance Tables, are available at recover from the 16.8 percent contraction in 2007, http://www.worldbank.org/wti. falling by 7.7 percent in 2008, and is expected to fall again by 2.8 percent in 2009. Several factors, including If using information from this brief, please provide the water in the oil layers due to geological phenomena following source citation: World Bank. 2010. “Chad and a pressure drop in the reservoirs causing a decline Trade Brief.� World Trade Indicators 2009/10: Country Trade in the production of oil, caused exports to drop by Briefs. Washington, DC: World Bank. Available at 11.7 percent in 2008, compared to an 18.7 percent fall http://www.worldbank.org/wti. World Trade Indicators 2009/10 Chad Trade Brief in 2007. The outlook for 2009 remains dismal, with References exports projected to fall by 2.7 percent. Imports dropped by 1.8 percent in 2008 compared to a 13.8 African Economic Outlook. 2009. Chad. African percent fall in 2007, and are expected to fall again by Economic Outlook. May 27, 2009. . In nominal terms, trade growth accelerated to an Europa. 2009. “Africa, Caribbean, Pacific—Regional estimated 18.3 percent in 2008 from 8.8 percent in negotiations of Economic Partnership Agreements.� 2007. Exports grew at an estimated rate of 23.8 Europa. March 2009. . imports grew by an estimated 11.9 percent, up from International Monetary Fund (IMF). 2009. “International 5.4 percent in 2007. The rising market price of oil in Financial Statistics.� IMF. July 2009. the first half of the year continued to boost the . country’s oil royalties, driving an estimated goods The Economist Intelligence Unit (EIU). 2009. “Country exports growth of 26.6 percent in 2008, more than Report—Chad.� EIU. June 2009. . however, expected to fall, resulting in a projected 30.1 World Bank. 2007. “Chad—Country Brief.� World percent decline in goods exports in 2009. Services’ Bank. September 2009. . rate of 7.5 percent, compared to 5.1 percent in 2007, World Trade Organization (WTO). 2007. “Trade Policy but is expected to decelerate to 5.7 percent in 2009. Review—Chad.� WTO. March 5, 2007. .