Article No. 40 [UNCTAD Transport and Trade Facilitation Newsletter N°84 - Fourth Quarter 2019]
According to Article 23.2 of the WTO Trade Facilitation Agreement (TFA), countries “shall establish and/or maintain a national committee on trade facilitation or designate an existing mechanism to facilitate both domestic coordination and implementation of the provisions of this Agreement.”
However, while the set-up of such committees seems to be a pretty straight forward business, ensuring their sustainability, meaning the continuation of their work overtime, remains a challenge, as demonstrated by a recent survey conducted by UNCTAD.
Challenges to the sustainability of trade facilitation committees
In Summer 2019, UNCTAD asked chairpersons of 52 National Trade Facilitation Committees (NTFCs) to rate, using a scale from 0 to 100, to what extent they considered their NTFC to be sustainable in time. The average answer was a score of 68. This is a rather low number considering that WTO Member States are obliged by international law to establish, and maintain, such mechanism.
According to the results of this survey, there seems to be a correlation between the level of development of a country and the level of sustainability of its NTFC. From a scale of 0 to 100, developed countries rated the sustainability of their Committees at 90, while the figure decreased to 70 for developing countries and dropped to 56 for least developed countries (LDCs).
What are the reasons behind these low scores in the case of developing countries and LDCs? Two thirds of respondents consider the lack of financial assistance or adequate human resources to be the main obstacles for sustainability of the NTFC. Other key challenges mentioned by half of the respondents included: (i) lack of high-level support and political buy-in; (ii) resistance to change in the Government administration and (iii) lack of awareness of importance of the NTFC and trade facilitation.
These challenges are certainly interlinked. The lack of high-level support and the resistance to change could be addressed through better understanding of the benefits of trade facilitation and of the international obligations that have fallen upon WTO member countries with the entry into force of the TFA.
How UNCTAD supports the sustainability of NTFCs
Since 2016, UNCTAD has been supporting the creation as well as building capacity of NTFCs in many countries around the world with its Empowerment Programme for National Trade Facilitation Committees.
The Programme has been raising awareness on trade facilitation and supporting NTFCs in the ratification and notifications procedures. The programme has been investing in improving stakeholders’ understanding on the importance of trade facilitation, explaining international standards and recommendations but also the link between trade facilitation and development and the benefits of simplification, harmonization and standardization of trade procedures for the society. During the first modules of the Programme, UNCTAD experts work hand in hand with the members of the National Trade Facilitation Committees to ensure that the countries fulfil their ratification and notification obligations towards the WTO. In fact, by October 2019, of the 33 WTO Members supported by UNCTAD since 2017, 30 have ratified the TFA and 29 have submitted their ABC categorizations to the WTO.
In addition, UNCTAD has been providing NTFCs with tangible tools to ensure that the knowledge acquired during the duration of the programme is maintained and transferred, thus contributing to the sustainability of the Committees. Concretely, this is achieved supporting countries to draft a National Trade Facilitation Roadmap, that will be used as multi-annual work plan for the NTFC to steer trade facilitation reforms, irrespectively of changes that might occur in the NTFC membership. It also includes a “training of trainers” module, where key trade facilitation stakeholders draft a Knowledge Transfer Strategy to ensure that new members of the NTFC are properly introduced to the topic of trade facilitation and to their role as members of the NTFC. To support that endeavour, UNCTAD has created a series of online courses which recapitulate some of the key lessons of the Empowerment Programme. The courses are videos of up to one hour each, which answer, in an interactive way, key questions such as:
What is trade facilitation?
Why is trade facilitation increasingly important?
What are the benefits of trade facilitation?
Can trade facilitation support a country’s development policy?
What is the TFA?
How can we legally interpret each of the Provisions of the Agreement?
What is the role of National Trade Facilitation Committees?
Which trade facilitation indicators and indexes should a country take into consideration?
What is the relationship between Technical Barriers to Trade and Sanitary and Phytosanitary measures and trade facilitation?
What other international standards and recommendations, apart from the TFA, are of interest to implement trade facilitation reforms?
In 2019, the courses were developed and later distributed to eight “empowered” NTFCs in the Caribbean Region. In just a couple of months, the online courses have recorded over 2000 views, cumulating over 33.000 watch minutes.
“The courses show that trade facilitation is much more than just the TFA, in that they also help to put the Agreement into a broader perspective by addressing the intricate interplay of the various provisions with commerce and the wider sustainable development agenda”, said Ricky Jnbaptiste, Attaché, Mission of the Organisation of Eastern Caribbean States in Geneva.
UNCTAD approach to support NTFCs from developing and least developed countries seems to be working and this was reflected in the survey undertaken during the summer of 2019, with countries benefitting from Empowerment Programme being more optimistic about the sustainability of their Committees. From a scale of 0 to 100, developing countries that have been supported by UNCTAD rated the sustainability of their Committees at 71, compared to 69 for those committees that were not assisted by UNCTAD. The correlation is even more visible when it comes to least developed countries: the figure goes up to 63 compared to 50 for those LDCs that have not been assisted by UNCTAD.
“Saint Lucia is quite pleased to be benefiting from the online training courses on the TFA being provided as part of the UNCTAD Empowerment Programme to National Trade Facilitation Committees. Even the high-level members of the NTFC are excited about the courses and the wealth of knowledge being attained from each week's offering. The courses are infusing greater interest in trade facilitation nationally and consequently is promoting a greater thrust towards pursuing reforms to expedite the movement, release and clearance of goods. The mode of delivery with the short videos and accompanying script are easy to follow and the information is very useful in allowing the members of the NTFC to better understand why we should keep moving forward with great vigour with our trade facilitation agenda”, highlighted Lydia S. Dariah, Trade Facilitation Focal Point, Ministry of Commerce, International Trade, Investment, Enterprise Development and Consumer Affairs, Saint Lucia.
The development of the online courses was made possible thanks to the financial support of the Commonwealth Heads of Government Meeting via Her Majesty Revenue and Customs of the United Kingdom of Great Britain and Northern Ireland.