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5) There is a whole discussion about transport & insurance markups -- should it be 14%, 10%, 6% ? GFI use a model which takes into account different products, countries etc.. which averages at 9% for Kenya
Many of the major areas of apparent misinvoicing (vehicles, electrical equipment, fuel) are underinvoiced by 1-3% ..... this seems like it could be within the range of uncertainty about transport costs
Used clothing and cereals have larger misinvoicing margins. There is a nifty graphic which shows absolute and relative size of the apparent tariff losses by product and countrypic.twitter.com/AW3Yd3laZ1
This seems to me like a useful risk assessment tool. These are specific red flags to follow up on. Are there innocent explanations for the patterns in the data or is there something dodgy in these specific trades? (like whats up with used clothing exports from UK to Kenya?)
I'd like to see what the potential losses in different categories look like with different modelling assumptions on the transport costs -- how robust are they? But all in all a lot of improvement in the methodology.
Its not quite so clear in the Nigeria case - again they focus detailed analysis on import underinvoicing (absolute numbers driven by small margins on large volumes of vehicle imports). But import underinvoicing is not the biggest category in Nigeria...what is the export story?pic.twitter.com/t2gX52TCWc
Kudos to @GFI_Tweets for working to address the methodological issues and improve the estimates (they could publish the underlying data and calculations too!)
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