Understanding non-tariff measures remains vital to increase global trade, speakers agree at MC11

14 December 2017

Trade ministers and diplomats recognize that complex trade regulations must be understood if trade is to thrive and development goals met.

Transparency regarding “behind the border” trade regulations is vital to boosting incomes, creating jobs and growing economies in developing countries, speakers agreed at an event at the World Trade Organization’s Eleventh Ministerial Conference in Buenos Aires, Argentina, on 11 December.

The event – Transparency Matters: The unseen impact of NTMs – heard trade ministers, envoys and leaders of intergovernmental organizations say that non-tariff measures (NTMs) are an often-underestimated brake on trade with and between developing nations which can impede economic growth.

"Getting market access depends more on non-tariff measures than anything else,” UNCTAD Deputy Secretary-General Isabelle Durant said in a discussion moderated by Anabel Gonzalez, a senior director at the World Bank Group.

UNCTAD actively collects information about NTMs by analyzing countries' official laws and regulations and feeding it into a database covering around 80% of world trade and 109 countries.

Its relevance was heightened during MC11 negotiations which saw the European Union and several other countries make a proposal to strengthen the WTO notification system.

Legitimate goals

While the WTO notification system is based on proposed measures and allows for comments, UNCTAD's database contains a comprehensive list of all regulations actually in force, including all sanitary and phytosanitary measures and technical barriers to trade as well as non-technical measures such as quantity and price measures, Ralf Peters, Chief of UNCTAD's Trade Information Section, said.

Many NTMs are set up to pursue legitimate goals, such as health and environmental protection. Nevertheless, they often hamper exports and affect competitiveness.

Amelia Kyambadde, Uganda’s Minister of Trade, Industry and Cooperatives, said that NTMs were important for trade and sustainable development, while Albert M. Muchanga, the African Union’s Commissioner for Trade and Industry, agreed that knowledge of NTMs was important for deep, continent-wide economic integration in Africa.

UNCTAD collects data on Africa in collaboration with the African Development Bank Group and the secretariats of the East African Community, the Common Market for Eastern and Southern Africa, and the Southern African Development Community.

Alejandro de la Peña Navarrete, Secretary General of the Latin American Integration Association (ALADI), said that the longstanding cooperation with UNCTAD on NTMs has contributed significantly to enhance the transparency of trade regulations in Latin-America.

UNCTAD has been working closely with ALADI for more than a decade to collect and disseminate data on NTMs for ALADI members.

Meanwhile, Walter Werner, Germany’s ambassador to the WTO, noted that the work of the G20 had done on NTMs during its presidency of the group in 2017 was handed over to Argentina two weeks before.

Report and helpdesk

A new report by UNCTAD and the World Bank Group on the unseen impact of NTMs, based on the latest release of UNCTAD’s NTM database was also launched during the event.

The report, which was financially supported by Japan, was received by Mitsunari Okamoto, Japan’s Parliamentary Vice-Minister for Foreign Affairs, who confirmed during the meeting how important NTMs are for a trading nation like Japan as well as for economic development.

Eldar Abakirov, Kyrgyzstan’s Deputy Minister of Economy, thanked UNCTAD, the World Bank Group and United Nations Economic Commission Commission for Europe for its support in the area of NTMs during his country’s integration into the Eurasian Economic Community. He condemned unjustified barriers to trade and said how important market access and transit was for landlocked countries such as Kyrgyzstan.

Ambassador Anibal Cabral, Director General for Economic International Affairs, Uruguay, said regulatory cooperation was important for regional integration, referring to a recent UNCTAD publication on regulatory cooperation in Mercusor, the Southern Common Market of Latin America.

For developing countries and especially the least developed countries, Ms. Kyambadde added, problems are linked not only to getting a clear understanding of NTMs, but also to having national bodies in charge of inspection, certification, and so on, that have sufficient human and financial resources to carry out their tasks efficiently. This is an area where substantive improvements are needed.

Earlier on 11 December, the International Trade Centre, UNCTAD and the WTO jointly launched a Global Helpdesk to support small and medium size enterprises get information on tariffs, taxes and NTMs so that they can export their goods. The helpdesk was launched by Ms. Durant, WTO Deputy Director-General Yi Xiaozhun, and ITC Executive Director Arancha Gonzales.