With 22 February 2019 marking the second anniversary of the WTO Trade Facilitation Agreement - and a crucial date in its implementation timetable - new analysis shows what's at stake.
Two years to the day since the World Trade Organization’s Trade Facilitation Agreement (TFA) entered into force, a new analysis from UNCTAD shows that help is at hand for the developing countries aiming to meet its terms on time.
With commerce between WTO members accounting for 98% of world trade, the TFA aims to speed up the movement, release, and clearance of goods across international borders as well as to enhance effective cooperation between customs services.
According to the new analysis, 22 February 2019 not only marks the second anniversary of the agreement, but is also a critical implementation date. An initial step – on implementation and assistance – remains a pending goal for almost half of both developed and developing country WTO members.
And while 141 out of 164 members have ratified the agreement, the remaining 22 are all developing countries, with half of these classified as Least Developed Countries, according to the analysis.
“We provide support to countries implementing the TFA because faster clearance at the border means families pay less for food, clothes, electronics and more,” Shamika N. Sirimanne, the director of UNCTAD’s technology and logistics division, said. “This is especially important in poorer countries, where trade costs 1.8 times more than elsewhere because of border delays.”
Full implementation of the agreement would cut members' trade costs by an average of 14.3%, according to the WTO, and is a significant opportunity to boost global commerce, enhance prosperity and help nations meet the Sustainable Development Goals.
But the analysis says that developing countries and Least Developed Countries willing to seize what are known as the “special and differential treatment” provisions of the TFA must comply with the implementation notification requirements set out in the agreement.
“These notifications are part of the deal,” Ms. Sirimanne said. “Developing countries cannot expect to reap the benefits from these flexibilities if they do not comply with their part of the deal – but they are not alone in this journey. They can count on development partners like UNCTAD to assist them.”
Negotiations on the landmark agreement concluded at the WTO’s Bali Ministerial Conference in 2013, and it entered into force upon ratification by two-thirds of the 164-strong WTO membership on 22 February 2017.
UNCTAD assists countries in the implementation of the WTO TFA with:
Empowerment Programme for National Trade Facilitation Bodies: Five modules – developed by international experts – empowers committees by giving them the knowledge and the capacity needed to implement trade facilitation reforms. From establishing a committee to creating a national roadmap for mainstreaming trade facilitation, UNCTAD tailors these modules to the needs of the countries as needed, ensuring its sustainability by training trainers to pass on knowledge.
Automated System for Customs Data (ASYCUDA): By fully automating trade procedures, ASYCUDA facilitates trade efficiency and competitiveness by reducing transaction times and costs, promoting sustainable development by cutting down the use of paper, enhancing transparency and improving revenue collection. ASYCUDA has made customs processes easier and faster in 115 countries.
Trade Portal: UNCTAD developed trade portals for 34 countries. Traders no longer have to struggle with acquiring information – all information is published online. Step-by-step procedures, forms and documents, costs and duration of each action, contact information of people in charge, and even the legal basis and complaints procedures are all provided in the trade portal.
Implementation plans and roadmaps for trade facilitation reforms: UNCTAD has assisted over 60 countries in the drafting of national implementation plans and roadmaps for comprehensive trade facilitation, including the implementation of WTO TFA.
The WTO said its members took stock of progress in implementing the TFA at a 12–13 February meeting of the Committee on Trade Facilitation. Members called for the timely fulfilment of commitments and discussed efforts to help each other carry out the agreement, the WTO said.
UNCTAD has supported trade facilitation reforms for more than 40 years, based on good practices, bringing to the table its unrivalled expertise, research and technical solutions.