BUREAUCRATIC delays and red tape pose a burden for moving goods across borders for traders. Trade facilitation— the simplification, modernisation and harmonisation of export and import processes—has therefore emerged as an important issue for the world trading system.
WTO members concluded negotiations at the 2013 Bali Ministerial Conference on the landmark Trade Facilitation Agreement (TFA), which entered into force on February 22 following its ratification by two-thirds of the WTO membership. The TFA contains provisions for expediting the movement, release and clearance of goods, including goods in transit. It also sets out measures for effective cooperation between customs and other appropriate authorities on trade facilitation and customs compliance issues. It further contains provisions for technical assistance and capacity building in this area.
Out of the 15 SADC member states only eight, including Namibia, have to date ratified and accepted the agreement on trade facilitation.
Estimates show that the full implementation of the TFA could reduce trade costs by an average of 14.3 percent and boost global trade by up to $1 trillion per year, with the biggest gains in the poorest countries. For the first time in WTO history, the requirement to implement the agreement is directly linked to the capacity of the country to do so. A Trade Facilitation Agreement Facility (TFAF) has been created to help ensure developing and least-developed countries obtain the assistance needed to reap the full benefits of the TFA.
By ratifying the agreement, Namibia has shown its commitment to the multilateral trading system following through on the promises made when this deal was struck in Bali. And by bringing the deal into force WTO can now begin the work of turning its benefits into reality.
Imperatively and highly notable is that the agreement is unique in that it allows developing and least-developed countries to set their own timetables for implementing the TFA depending on their capacities to do so – and it provides for support to help them develop their capacity. The Trade Facilitation Agreement Facility (TFAF) was created at the request of developing and least-developed countries to help ensure they receive the assistance needed to reap the full benefits of the TFA and to support the ultimate goal of full implementation of the new agreement by all members. The TFA further provides for the establishment of a committee on trade facilitation to periodically review the Agreement’s operation and implementation.
Full implementation of the TFA is forecast to slash members’ trade costs by an average of 14.3 percent, with developing countries having the most to gain, according to a 2015 study carried out by WTO economists. The TFA is also likely to reduce the time needed to import goods by over a day and a half and to export goods by almost two days, representing a reduction of 47 percent and 91 percent respectively over the current average.
Confidente. Lifting the Lid. Copyright © 2015