Drivers of Higher Transaction Costs in Developing Countries 
Overview 
In order to take advantage of the opportunities provided by the international trade system, developing countries must meet the demands of complex production and distribution networks that value speed, reliability and efficiency. As noted in the previous chapter, there are various steps in the trade transaction that can add to the final cost of a good at its destination. Generally, trade support services costs can be broken into a number of categories: • Costs of transport via air, ocean, rail and/or road freight • Use of infrastructure and facilities for cargo handling and transfer • Customs and border procedures • Transport intermediaries • Banking and finance costs related to trade insurance and letter of credit 
The actual costs of trade support services can vary according to the location of a country, the mode of transport used, quality of trade support services infrastructure, the level of competition within the trade support services market, and regulatory framework within which the services operate. These costs contribute to the overall cost of a good from any country, whether developing or developed.