Jul 31, 2009

Malaysian contraband

I was on the ASEAN website doing some serious research and looking at Malaysia’s trade policies, especially at the goods with prohibitions, controls and restrictions. Among the list of goods absolutely prohibited from import were turtle eggs, piranha fish, daggers etc… but also all goods from Haiti.

Then I also saw that all goods from Israel were prohibited from exportation unless accompanied by an export license (as are many random products). Why these two countries? As for Israel, Malaysia does not recognize it as a State…As for Haiti I have no idea! But now the question is: are these bans reflected in their trade data?

I looked at the trade statistics. While Haiti does not report any trade stats since 1997, I found that Malaysia reported imports from Haiti of $310,472 in 2007 and $8 in 2008! Too bad these goods were classified as HS 9999, i.e. commodities not elsewhere specified.

As for trade with Israel there is a major smuggling gap (Israel reported imports – Malaysia reported exports) of the order of $41 million in 2005 and $63 million in 2007 (see table). Looking at more detailed data I saw that these exports ranged from electronics to cocoa powder.

Obviously, there is here plenty of material for a great freakonomic gangsters paper.

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