EAC – Business Leaders demand shift to New Trade Rules

eabc-flagsThe East African Business Council, the umbrella body of the region’s private sector, has asked governments in the five-member East African Community (EAC) to expedite implementations of the new WTO trade facilitation agreement.

Council chairperson, Felix Mosha, made the appeal on Tuesday during a breakfast meeting with trade facilitation institutions and the business community in Arusha, Tanzania.

WTO members in December 2013 adopted the Agreement on Trade Facilitation during the Ninth Ministerial Conference in Bali, Indonesia after 10 years of negotiations. The Bali deal aims at boosting poor countries’ ability to trade and allow them more flexibility in food security. The agreed text is currently under review by legal experts and will come into force once two thirds of the 159-member World Trade Organisation accept it.

Trade and Industry minister, Francois Kanimba, told The New Times that implementation of the agreement cannot be done immediately because WTO is yet to give member countries the requisite legal implementation modalities.

“By July, we’ll have got it, so that the process can start,” Kanimba said. He added that Rwanda, after a recent self-assessment on how it stands on the implementation road map, realised most requirements had been attained.

Steps made in facilitating cross-border trade such as the ongoing EAC one-stop border posts, and the 2012 launch of the electronic single window system, were some of the steps taken by Rwanda.

Benefits

“Everything, by nature of trade facilitation is always good. The trade balance for Rwanda is negative and if the Bali agreement helps us improve, it will help us address our development challenges,” the minister said.

“Rwandan traders will also benefit as trade facilitation is about easing things for them. For example, improvements in communication will ease access to vital information they need in different member countries and this will enable many to conduct trade more efficiently.”

With the agreement, WTO members established a new legal framework that fills gaps in the existing General Agreement on Tariffs and Trade (GATT), in effect since in 1947. The new agreement stipulates obligations and provisions on special and differential treatment for developing and least developed country members as well as the provision of technical assistance and capacity building. Obligations include publication and access to trade related information, appeal procedures, simplification of trade procedures and goods clearance processes, agency cooperation, as well as cross-border customs cooperation.

Calling for the “swift” implementation the WTO Bali Agreement on Trade Facilitation, Mosaha said: “This will go a long way in lowering transaction costs, enhancing competitiveness of the businesses as well increasing intra EAC trade”.

Mosha said that while some progress had been made in ensuring free movement of goods, persons, labour, services and capital, challenges continued to constrain full realisation benefits from integration. Among them he cited 33 non-tariff barriers, non-recognition of the certificate of rules of origin, additional taxes and charges and lack of harmony in domestic tax regime such as excise duty, VAT and income taxes. Source: The New Times.

Implementing the WTO Agreement on Trade Facilitation

WTO Agreement on Trade Facilitation

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It is anticipated that most Customs and Border Authorities have at least one common item on their national capacity building agenda’s for 2014 – the Agreement on Trade Facilitation. Many countries, being members of the WCO, would have already acceded to a level of commitment to the Revised Kyoto Convention (RKC). This requires of them to introduce, at an agreed time, the principles of WCO standards and policies according to the level of their sovereign commitment.

The General Annex to the RKC is the bare minimum a country would be expected to implement in order to for it to be considered compliant with the RKC. From a trade perspective, this also indicates the extent to which your country’s leaders have committed itself towards ‘global integration’.

What the recent Trade Facilitation Agreement (ATF) in Bali does is bind member states to a compendium of requirements necessary for the enactment of certain conditions and obligations as set out in the various articles contained in the agreement. Countries should also note that certain of the ATF provisions include items under the Specific Annexes to the RKC. For a quick reference to see how the RKC and other WCO standards and conventions stack up to the ATF, refer to the WTO Trade Facilitation Toolkit by clicking the hyperlink.

In addition to this, the ATF also makes provision for ‘special and differential treatment’ in regard to developing and least developed countries (Refer to Section II to the WTO ATF).

In essence this allows those countries and opportunity of identifying their (capacity building) needs and setting themselves realistic targets for implementation and compliance to the ATF. To this end 3 Categories are identified for national states to consider in the event they are not at present in a position to accede to some or all of the ATF conditions.

The WCO has also prepared various tools which aim at assisting its members in assessing their national position in regard to the ATF. Members are likewise encouraged to regularly visit the WCO website for updates in this regard.

The following working papers are available from the WCO website and, for ease of access, are listed below together with their hyperlink to the WCO site –

Other related Trade Facilitation documentation can be found at the following link – WTO Trade Facilitation Negotiations

Text of the WTO Free Trade Agreement

WCO to develop Implementation Tool for WTO ATF

WCO and WTO leaders meet in Geneva (WCO)

WCO and WTO leaders meet in Geneva (WCO)

At the invitation of WTO Director General Roberto Azevedo, WCO Secretary General Kunio Mikuriya met with Mr. Azevedo at WTO headquarters in Geneva, Switzerland on 20 January 2014. They agreed that close cooperation between the two organizations is vital for successful implementation of the WTO Agreement on Trade Facilitation (ATF).

Secretary General Mikuriya emphasized the consistent and complementary nature between the ATF and the WCO Revised Kyoto Convention (RKC). He also described how the WCO Economic Competitiveness Package, that includes the RKC and all other Customs trade facilitation instruments, guidelines and best practices, will support implementation of ATF. Mr. Mikuriya also confirmed his readiness to involve other international organizations, development banks, donors and other stakeholders at a WCO forum to contribute to cooperation in support of the ATF.

Director General Azevedo was pleased to hear that the WCO was planning to publish an implementation tool to connect each provision of the ATF to WCO tools as well as a briefing document enabling Customs administrations to communicate with trade ministries. He expressed his willingness to leverage WCO expertise and experts for the WTO Preparatory Committee on Trade Facilitation as well as ATF needs assessment and implementation. Mr. Azevedo also suggested that the ATF provides another opportunity for the two organizations to enhance the good working relations that already exist in many areas beyond trade facilitation.

The two leaders also discussed how multilateral institutions could work on regional integration matters and agreed on the importance of adopting global standards and best practices to ensure connectivity at borders. Source: WCO