In the wake of the ongoing COVID-19 outbreak, characterized by the World Health Organization (WHO) as a pandemic on 11 March 2020, countries around the world have been adopting a series of trade and border protection measures to try to contain the spread of the disease across borders. Such measures have had immediate and severe impacts on economic activities and caused major disruptions in supply chains. Given that trade facilitation is a key policy tool that can help countries mitigate some of the impacts of the COVID-19 pandemic, the WCO has partnered with the WTO, UNCTAD, the CSSO, the GATF, IATA and ITC to develop a COVID-19 Trade Facilitation Repository in which all these actions are consolidated.
The repository acts as a platform that consolidates the initiatives on trade facilitation adopted by organizations and stakeholders, seeking to provide access to these resources in a unique and user-friendly database. It contains a useful listing of all such initiatives broken down by organization, type of measure and subject matter. As the situation evolves and further actions are taken, the platform will be expanded to include other key actors working in the area of trade facilitation.
Since the beginning of the COVID-19 pandemic and its unprecedented sanitary and economic effects, the WCO and other international organizations, NGOs, business associations and other representative entities have redeployed resources to develop new instruments, tools and guidance materials on trade facilitation measures. These documents can be a useful source of information for countries to learn from each other, share best practices and experiences and provide inspiration to design targeted policy responses. However, these resources were scattered throughout a multitude of platforms. This initiative will assist in ensuring that the seamless flow of safe cross-border trade continues, especially with regard to essential goods which are crucial for fighting the COVID-19 pandemic.
The COVID19 Trade Facilitation Repository can be accessed via the following link and will be updated regularly to reflect new guidance material developed.
The WCO thanks its partners, the World Trade Organization (WTO), the United Nations Conference on Trade and Development (UNCTAD), the Commonwealth Small States Office (CSSO) in Geneva, the Global Alliance for Trade Facilitation (GATF), the International Air Transport Association (IATA) and the International Trade Centre (ITC) for this initiative and reiterates its commitment to assist its Members in securing, protecting and facilitating legitimate global trade.
The heads of the World Customs Organization (WCO) and the World Trade Organization (WTO) issued a joint statement on 6 April pledging to work together to facilitate trade in essential goods such as medical supplies, food, and energy.
WCO Secretary General Dr. Kunio Mikuriya and WTO Director-General Roberto Azevêdo said the two organizations would work closely together to minimize disruption to cross-border trade in goods – in particular those essential to combat the COVID-19 pandemic – while safeguarding public health.
They also pledged to establish a coordinated approach to support initiatives that facilitate cross-border trade so that essential goods can quickly reach those most in need, including in least developed and land-locked countries. WCO and WTO members have already been invited to increase transparency by sharing information on new trade and trade-related measures introduced in response to the COVID-19 pandemic.
“As COVID-19 continues to spread globally and governments consider new measures to protect the health and well-being of their citizens, we urge Members to ensure that any new border action is targeted, proportionate, transparent and non-discriminatory,” they declared.
The text of the joint statement is below.
WCO-WTO Joint Statement on COVID-19 related trade measures
The COVID-19 pandemic, while above all a public health crisis, presents the world with unprecedented social and economic challenges. Emergency measures needed to curb the spread of the disease have unintended impacts on the world economy and trade, including the global supply chains that produce and distribute essential goods such as medical supplies, food, and energy.
To support the ongoing efforts to mitigate the social and economic effects of the pandemic, we, the Secretariats of the World Customs Organization (WCO) and the World Trade Organization (WTO), agree to work closely together to minimize disruption to cross-border trade in goods – in particular those essential to combat COVID-19 – while safeguarding public health. We commit to provide appropriatesupport to all relevant stakeholders.
Within our respective mandates, we have already invited Members to increase transparency by sharing information on new trade and trade-related measures introduced in response to the COVID-19 pandemic. To the extent appropriate, we are making such information publicly available through our respective websites.
We are also willing to establish a coordinated approach in support of initiatives that facilitate cross-border trade in goods, in particular those key to combat COVID-19. This would allow that essential goods can quickly reach those most in need, including in least developed and land-locked countries.
As COVID-19 continues to spread globally and governments consider new measures to protect the health and well-being of their citizens, we urge Members to ensure that any new border action is targeted, proportionate, transparent and non-discriminatory – as agreed by G20 leaders. We stress that these measures should be temporary, and we encourage Members to rescind them once they are no longer needed, especially if they restrict trade. We welcome initiatives to facilitate and simplify cross-border procedures and urge our Members to prioritize those for exporting and importing essential goods.
As the pandemic evolves, we will continue to further explore ways to coordinate the efforts of the two organizations in response to the COVID-19 pandemic aimed at keeping trade flows open for the safety of populations around the world and a strong recovery of the global economy.
To mark International Customs Day 2020 – focusing on the theme of ‘fostering Sustainability for People, Prosperity and the Planet’, the following article from the Spring 2018 edition of World Trade Matters by Jan Hoffmann, the Chief of the Trade Logistics Branch, Division on Technology and Logistics at UNCTAD, is relevant. The article discusses global trade facilitation reforms, the digitalisation of trade and measures towards ensuring long-term sustainability in the maritime industry.
Confronted with growing populism and a surge in protectionist measures recorded by the WTO, policy makers and enterprises are struggling to avoid a backlash in international trade. At UNCTAD’s Trade Logistics Branch, we support these endeavours by helping to make trade work better. Through trade facilitation reforms, the promotion of digitalisation, and ensuring the long-term sustainability of international transport, we aim at ensuring that the international movement of goods is not confronted with unnecessary obstacles and costs.
A multilateral agreement to facilitate international trade
Under the Trade Facilitation Agreement (TFA) of the World Trade Organization (WTO), developing countries commit to implement a number of very practical measures that make trade easier and more transparent. Countries are obliged to publish duties and procedures on the web, traders can transmit their declarations prior to the arrival of the goods, payments can be made electronically, and fees and charges must not become hidden taxes to generate income for the government. These are but some of the 37 concrete measures grouped into 12 Articles of the TFA. They are all useful and help make trade more efficient.
However, many of these measures involve an initial investment or reforms that require human and financial resources to start with, which developing countries many not have. The good news is that the TFA also includes a novel mechanism – the so called “Special and Differential Treatment” – that helps developing countries plan and acquire the necessary capacity prior to being fully committed to comply with all 12 Articles. Concretely, the mechanism puts the developing countries in the position – and obligation – to analyse and notify their own implementation capacity. At UNCTAD, we are working closely with the developing countries to enable them to do so. Our main counterpart in this endeavour are the National Trade Facilitation Committees (NTFCs) that each country must set up under the TFA. UNCTAD’s Empowerment Programme for NTFCs includes training and knowledge development for the members of the NTFC, combined with advisory services and the development of a Roadmap of TFA implementation.
By the same token, UNCTAD also supports developing countries in setting up Trade Information Portals. Under the TFA, members of the WTO are obliged to make relevant information on tariffs and trade procedures available on-line. UNCTAD’s Trade Information Portals not only help countries become compliant with this obligation, but in the process of analysing and publishing applicable trade procedures, a Trade Information Portal effectively helps countries identify the potential for the further simplification of procedures. Thanks to these new insights, NTFCs can then develop programmes and reforms that subsequently ensure the further simplification of procedures.
Technological progress will never be as slow as today
My favourite provision of the TFA is Article 10.1., as it provides for a dynamic dimension of the Agreement. According to this article, countries need to minimize “the incidence and complexity of import, export, and transit formalities”, continuously “review” requirements, keep “reducing the time and cost of compliance for traders and operators”, and always choose “the least trade restrictive measure”. As such, even if a country is compliant with all TFA provisions today, countries will need to continue monitoring if existing procedures are still appropriate in view of technological or regulatory developments.
As trade becomes increasingly digitalised, and new technologies which do not yet exist will be developed, it will be important that governments continuously revise and review the applicable rules and regulations.
Digitalisation comes in stages. First, we optimize existing procedures, making use of cargo tracking, the Internet of Things, blockchain et al. Second, new businesses are developed which could not exist without the new technologies; new platforms come into being and we see more “uberisation”. Finally, there is transformation and science fiction; still in our lifetime Artificial Intelligence will overtake human capabilities to manage international trade and its logistics.
But let us take one step at a time. At UNCTAD, we support developing countries through eTrade readiness assessments, the development and upgrade of technological solutions in Customs automation and Single Windows, and by providing a Forum for our members to analyse and discuss the challenges that come with digitalisation. We encourage the development of global standards that allow for interoperability among new systems. The challenge for policy makers it to encourage private sector investments in new technologies and solutions, while ensuring that no new monopolies emerge that might exclude smaller players.
And it has to be sustainable
While we aim at ensuring continued growth in international trade, there is a catch. The transport of this trade encompasses increasing externalities, such as pollution, green-house-gas emissions, and congestion.
Ports need to minimise social and environmental externalities. Many port cities are among the most polluted places to live, as ships burn heavy oil, and delivering trucks produce noise and cause traffic congestions. In addition, ports need to be resilient in the face of disruptions and damages caused by natural disasters and climate change impacts.
International transport, including shipping, needs to play a larger role in addressing global warming and contribute to mitigating the carbon emissions that are causing climate change. Shipping emits less carbon dioxide (CO2) per ton-mile than other modes of transport, but then due to its sheer volume it also produces many ton-miles. Would it be possible that the industry could be charged by its main regulatory body not per ship tonnage (as is currently the case), but per tonne of CO2 emission?
Currently, the International Maritime Organization is funded proportional to the tonnage registered under the members’ flags. Like this, Panama, Marshall Islands and Liberia pay for the largest share of the IMO budget – and in the end, this is passed on to the ship-owner, who in turn passes this on to the shipper, who will charge the consumer. This is a good established mechanism that could be expanded to also internalize the external costs of CO2 emissions.
Being the most globalized of all businesses, maritime transport should consider adopting a global regime that helps further internalize its environmental externalities – to ensure prosperity for all.
It is all about efficiency
Investing in trade facilitation reforms, making intelligent use of the latest technologies, and ensuring that externalities are internalized are all several sides of the same coin. Trade efficiency is necessary to promote an open international trading system. It requires a continuous effort by policy makers to continuously review current procedures, apply the most appropriate technological solutions, and support an efficient allocation of scarce resources.
Source: Jan Hoffman, UNCTAD – originally published in World Trade Matters, Spring Edition, 2018
The WCO Policy Commission (PC) has seized the momentum garnered in the domain of electronic commerce and has unanimously adopted the Luxor Resolution at its meeting held this week from 4 to 6 December 2017 in the Egyptian city which gives its name to the Resolution.
The Resolution, developed in close collaboration with all stakeholders, outlines the guiding principles for cross-border E-Commerce addressing eight critical aspects, notably Advance Electronic Data and Risk Management; Facilitation and Simplification; Safety and Security; Revenue Collection; Measurement and Analysis; Partnerships; Public Awareness, Outreach and Capacity Building; and Legislative Frameworks.
The Resolution is aimed at helping Customs and other government agencies, businesses, and other stakeholders in the cross-border E-Commerce supply chain to understand, coordinate and better respond to the current and emerging challenges.
Additionally, and taking into consideration the relevance of the topic and the need to better position the work of the WCO and coordinate ongoing efforts, the PC has also issued a Communiqué to the Eleventh WTO Ministerial Conference (MC11), the Organization’s highest decision-making body, attended by trade ministers and other senior officials from the WTO’s 164 Members, that will take place in Buenos Aires, Argentina, from 10 to 13 December 2017.
The Communiqué strongly reaffirms the WCO’s leadership in providing policy and operational frameworks for the effective management of cross-border E-Commerce from both a facilitation and a control perspective, and clearly demonstrates its strong commitment to supporting the WTO’s Work Programme on E-Commerce, moving forward. Source: WCO
A major milestone for the global trading system was reached on 22 February 2017 when the first multilateral deal concluded in the 21 year history of the World Trade Organization entered into force. In receiving four more ratifications for the Trade Facilitation Agreement (TFA), the WTO has obtained the two-thirds acceptance of the agreement from its 164 members needed to bring the TFA into force.
Rwanda, Oman, Chad and Jordan (pictured above) submitted their instruments of acceptance to WTO Director-General Roberto Azevêdo, bringing the total number of ratifications over the required threshold of 110. The entry into force of this agreement, which seeks to expedite the movement, release and clearance of goods across borders, launches a new phase for trade facilitation reforms all over the world and creates a significant boost for commerce and the multilateral trading system as a whole.
Full implementation of the TFA is forecast to slash members’ trade costs by an average of 14.3 per cent, 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 per cent and 91 per cent respectively over the current average.
Implementing the TFA is also expected to help new firms export for the first time. Moreover, once the TFA is fully implemented, developing countries are predicted to increase the number of new products exported by as much as 20 per cent, with least developed countries (LDCs) likely to see an increase of up to 35 per cent, according to the WTO study.
At present, 10 out of 24 Members of East and Southern Africa (ESA) have ratified the TFA. These are; Mauritius, Botswana, Lesotho, Kenya, Zambia, Seychelles, Madagascar, Swaziland, Mozambique and Rwanda. So where to now South Africa?
The following article is published with the kind permission of the author, Tapia Naula who is Principal Transport Economist at African Development Bank, based in the Ivory Coast. He is an international project manager and transport economist with experience in logistics business, research and trade facilitation. This article is a must for anyone associated with or working on the TFA on the African sub-continent, and a bit of a wake up call to those countries who have as yet done little or nothing to progress their participation.
In the World TFA Cup Asia is leading Africa 72 – 35. The first scores of the WTO Trade Facilitation Agreement are out as member countries submit their Category A notifications. Initial results of the African first series are somewhat unfulfilling. Some teams are playing defensive even if attacking tactic is the only way to win.
In December 2013, WTO members concluded negotiations on a Trade Facilitation Agreement (TFA) at the Bali Ministerial Conference, as part of a wider “Bali Package”. Among trade facilitation practitioners the Agreement was received with great enthusiasm: finally there was a legal instrument, which is concrete enough to make a difference! TFA will enter into force once two-thirds of members have completed their domestic ratification process. Section I contains substantive provisions in 12 main Articles. The members are required to categorize and notify each provision of the Agreement as either A, B or C Category. The A Category commits a country to implement the provision upon entry into force of the TFA, or one year after for LDC’s. For B-Category there will be a transitional period. C-Category provisions are allowed a transitional period, technical assistance and capacity building.
First, let it be said loud and clear: the WTO TFA is an excellent collection of modern trade and transport facilitation instruments in one folder. In developing countries its implementation would mean reforms that would save time, money and efforts for regular business people and consumers. These reforms may be painful but the countries that can do it, will be the future winners of their regional competition and they will be the ones that will most benefit from joining the global value chains. TFA is the best vehicle for poverty reduction invented so far and that is why it is so important.
In August, 2015, 14 African countries and 25 Asian countries had submitted notifications for category A provisions. Asian countries had “accepted” 72 % of all the provisions as A-Category commitments on average where the respective share of the African countries is only 35 %. On Article-level African countries lag behind on every Article except one (Table 1).
In addition to the low overall share of category A-notifications, the African notifications generally look like “random picks” of sub-paragraphs, compared to many Asian members that have commonly chosen the strategy of basically accepting the whole Agreement and making exceptions for certain few paragraphs according to their particular needs.
Were African governments well-informed of the impact and substance of each paragraph – or are they just being cautious, perhaps trying to delay the final commitment? The patterns between African and Asian countries are in any case different.
TFA includes also “low hanging fruit” – sections that require little technical expertise to be implemented. At least some of these should have been easy for member countries to accept. “Publication and Availability of Information” is one of those sections. Access to information through internet is routine and affordable. It should not require transition periods or particular technical assistance. Donors are even competing to assist governments with such low cost and high-return activities. Still, less than one third of the African Governments notified this Article.
Here are some other peculiar findings:
Out of 14 African countries only Morocco accepted “Border Agency Cooperation” as A –Category provision. Three of the others countries that did not notify it are landlocked countries;
Only four out of 14 African countries had fully notified “Freedom of Transit.” Transit challenges in Africa are probably the single most significant source of inefficiency in trade logistics;
One of the foundations of modern customs management is the introduction of Risk Management. Only 3 out of 14 African countries had notified this provision;
Only Morocco notified Trade Facilitation Measures for Authorized Economic Operators (AEO), which gives certain privileges to traders and transport operators, who show high level of compliance to regulations. One wonders why Kenya, Uganda, Rwanda, Burundi and Tanzania did not notify it as we know that an AEO program is being piloted in the East African Community;
Only Senegal notified the sub-Article on Single Window, which is probably the most important one of the whole Agreement. Senegal perhaps deserves this honor – being the first truly African-based single window country – and also representing the good practice of SW management. Yet, according to the African Alliance for e-Commerce, currently there are at least 16 other single windows either already operational or under development in Africa. Why weren’t these developments recognized?
Despite the above “peculiarities” the African situation is fortunately nowhere near as somber as the A-Category notifications indicate. There are plenty of trade and transport facilitation initiatives under implementation – and Africa is indeed “on the Move.” We should on one hand side make sure that the valuable TFA Agreement is not becoming a separate formal process alongside the practical actions on the ground, but rather a framework for coaching governments in climbing up the stairs toward greater competitiveness. On the other hand, the countries should not ignore the existing achievements. A lot has been achieved in Africa in recent years and this process should go on and gain speed. Some sub-regions, which have been less successful in this field need benchmarks, encouraging and coaching. This is where African and international organizations can play a role.
Although the direct cost of TFA implementation is relatively low, the indirect cost may be extremely high. The indirect cost concerns existing structures, which generate income for organizations and individuals, who often greatly benefit from the status quo. Some governments have entered into concessions outsourcing critical government functions such as pre-customs clearance operations and processing and submissions of declarations to customs. Western firms have efficiently seized the opportunity and negotiated deals, which guarantee profits for in many cases for decades to come. Single Windows in certain countries are good examples for these. In an unnamed Southern African country for example, humanitarian aid is exempt from taxes and duties in import. If however a UN agency for example imports a container of pharmaceuticals worth five million USD, it will have to pay for a Single Window fee of 42,500 USD! Such Ad Valorem fee arrangements are against the TFA. Such concessions are often built inside structures, which profit from the concessions and in exchange – protects its operations and continuity. This is why they are difficult to tackle. This is an example of the problematics that African policy makers must deal with when taking a position in committing in TFA provisions. It may be a whole lot more complicated than what it looks like.
Association between % Share of Sub-Article Level A-Category Commitments and the Corruption Perception Index Score (CPI). Sources: WTO and transparency International.
The diagram above shows the association of share of the provisions that have been covered by A-Category notifications and the Corruption Perception Index (CPI) score of the countries. For African countries the correlation is moderate (correlation co-efficient: 0.42) but for Asian countries the association is strong (correlation co-efficient: 0.73). The association of the two variables is understandable: the less corruption a country has (the higher the CPI rank is), the more reforms the government is in liberty to conduct (the higher coverage of TFA as A-category Notifications).
We need to better understand the underlying reasons why policymakers cannot let reforms take off. Traditions, corruption and outdated structures are usually the biggest obstacles. These cannot be overcome by merely providing short-term technical assistance and bench-marking the world best practices but only strong political leadership can make the change. Developing partners should raise this topic on the highest political level and “live together” through the reforms with the counterparts.
The Northern Corridor (Kenya, Uganda, Rwanda) provides an encouraging example how multiple reforms can be carried out in very short time. Only two years ago it took staggering 27 days to transport a container from Mombasa Port and deliver it in Kigali, Rwanda. Today it takes only seven days. The improvement was enabled by series of reforms, which were championed by the Heads of States of the Corridor member countries. The example proves that major improvements can indeed be achieved in very short time. On the other hand, even with the most sophisticated instruments, reforms will not succeed if there the high-level ownership is not there. Author: Tapio Naula
The Namibia’s Ministry of Finance and Namibia’s Customs & Excise, in partnership with the U.S. government has recently launched a powerful new tool to increase and facilitate cross-border trade. The “Namibia Trade Information Portal” is a web-based platform that provides an authoritative “one-stop shop” of readily accessible trade, customs and compliance information. It is designed to significantly reduce the time and effort required for local and international traders to access current information and documentation required for doing business. The portal is the culmination of many years of collaboration between government of Namibia agencies and ministries and the U.S. government, working through the U.S. Agency for International Development (USAID) Southern Africa Trade Hub Project.
In his keynote address, Minister of Finance Calle Schlettwein said that the Trade Portal reflects the commitment of the Namibian government to build a “robust, knowledge-based society” through various modernization projects. However, he cautioned that the portal must be kept up-to-date if it is to be sustainable and relevant.
“For this reason, I strongly appeal to my fellow and counterpart ministers to designate focal points in their ministries who shall administer and avail timely updates, preferably online transmission of such information to our designated team in the Ministry of Finance who will, in turn, keep the portal updated,” Schlettwein said.
According to Namibia Trade Information Portal’s project manager, Melannie Tjijenda, the portal will save people time when they enquire about trade-related matters, so they will no longer be sent ‘from office to office.’
“International traders will now know how they can invest in Namibia,” she said, adding that this will save money on expenses like phone calls.
Tjijenda said the fact that most government websites are not regularly updated will not be the case with this portal. “When something changes, we will update it” she said, further pointing out that they have a team of content managers who will be checking and updating the content on regular basis. Source: The Namibian/USAID
“Simplifying trade documentation”; “automating border procedures”; “streamlining border controls” – all cliche’s of the modern customs and international trade scene, but just how attainable are they? Beyond the pleasantries, and fanfare of ribbon cutting ceremonies, very little seems to happen at the cold face. Sovereign states are inward-looking and jealously wish to preserve their ‘sovereign domains’.
A major World Trade Organization deal on streamlining global customs rules could cut international trade costs by between 12.5 percent and 17.5 percent, a study by the Organization for Economic Co-Operation and Development showed on Thursday.
A deal between India and the United States on the Trade Facilitation Agreement last year, which needs to be backed by all 160 WTO members, had resurrected hopes that the trade body could push through such reforms to cut red tape.
“There are very practical measures that we’ve identified that offer significant benefits,” Ken Ash, the OECD director for Trade and Agriculture, told media.
“Things like simplifying the required trade documentation. Automating border procedures, or streamlining border controls.”
Economists say the Trade Facilitation Agreement could save $1 trillion. Ash declined to endorse this figure, only saying the Paris-based body expected each 1 percent reduction in worldwide trade costs to bring $40 billion in savings.
Australia was to formally accept the agreement later on Thursday, Steven Ciobo, parliamentary secretary to the minister of foreign affairs, said at the news briefing in Paris, making Australia the seventh WTO member to adopt the agreement.
The WTO has launched a new website which will serve as a focal point for members, donors, and others seeking information on the new Trade Facilitation Agreement Facility (TFAF). The TFAF was created at the request of developing country and least-developed country (LDC) members to help ensure that they receive the assistance needed to reap the full benefits of the Trade Facilitation Agreement and to support the ultimate goal of full implementation of the new Agreement by all members. The TFAF will support these countries in assessing their specific needs and identifying possible development partners to help them meet those needs through a diverse number of activities.
The Facility was formally launched on 22 July 2014 by WTO Director-General Roberto Azevêdo and became operational on 27 November 2014. The website can be accessed here! To benefit from this, developing and LDC members must notify the WTO which provisions they will implement when the Agreement enters into force or, in the case of LDCs, within one year after entry into force (Category A commitments); which provisions they will implement after a transitional period following the entry into force of the Agreement (Category B); and which provisions they will implement on a date after a transitional period following the entry into force of the Agreement and that require the acquisition of assistance and support for capacity building (Category C).
The aim of the TFAF is to help ensure that this assistance is provided to all those needing it. The website provides background on the Agreement and the TFAF, information on programmes that support implementation of the Agreement, as well as information on national contact points for trade facilitation in developing and LDC members.
The website also provides information on TFAF support related to the preparation of Category A, B and C commitments, assistance and support for capacity-building, and applications for TFAF grants where no other funding sources are available to developing and LDC countries to meet their implementation needs. The website is a “work in progress” and will be continuously updated to provide useful information for WTO members. Source: WTO
Secretary General of the WCO, Mr. Kunio Mikuriya, welcomes delegates to what is now one of WCO’s premium external events bringing together representatives of the software industry and Customs policy makers.
The 14th annual WCO IT Conference & Exhibition was officially opened on 6 May 2015 in Freeport (Bahamas). Senior Government representatives of The Bahamas Government opened the 3-day Conference in the presence of over 400 participants from 75 countries.
The Right Honorouble Perry Gladstone Christie, Prime Minister and Minister of Finance of the Commonwealth of The Bahamas thanked the WCO for choosing The Bahamas for this very important global Conference. The hosting of this WCO event is an example of the government’s commitment to bring business opportunities to Grand Bahama!
The Prime Minister further continued by reminding the delegates that the WTO concluded negotiations on a Trade Facilitation Agreement at the Bali Ministerial Conference in December 2013 and about its potential of reducing international trade costs of approximately 12%. He underlined that the WTO Trade Facilitation Agreement owes much to the technical work that had already been carried out at the World Customs Organization.
In his speech, the Prime Minister stressed: “Our efforts are very much consistent with the theme of this Conference “Inclusiveness Through Information Technology”. It is in our interest here in The Bahamas to pursue an inclusive approach to the introduction of the new IT systems. These new systems must bring benefits, not only to government, but also to commercial operators and to the general public who will use these services. We recognize that with the introduction of these IT systems we must adopt a more client focused and customer orientated approach to make it easier to conduct business.”
The Secretary General of the WCO, Mr. Kunio Mikuriya, welcomed the delegates to what is now one of WCO’s premium external events bringing together representatives of the software industry and Customs policy makers. The Secretary General emphasized the theme of this year’s Conference “Inclusiveness Through Information Technologies”, adding that it addresses three key priorities of the WCO Members – Implementation of the WTO Trade Facilitation Agreement, Regional Economic Integration and Coordinated Border Management.
Mr. Charles Turner, Comptroller of Customs and Excise Department of the Commonwealth of The Bahamas, stressed that the IT Conference & Exhibition comes at an important juncture for The Bahamas as the Customs Department implements the Trade Sector Support Program. Having such a broad range of exhibitors and international delegates provides a rare opportunity to share ideas and learn from the experiences of others. Source: WCO
The role of the private sector in the implementation of the World Trade Organization’s (WTO) Trade Facilitation Agreement (TFA) will be the focus of the 2015 edition of the Global Facilitation Partnership for Transportation and Trade (GFP) meeting. With the world’s customs administrations currently identifying their respective TFA implementation commitments and setting up National Trade Facilitation Committees, trade and logistics operators can learn how they can participate in such initiatives by attending these sessions.
Organized by the International Trade Centre (ITC) in partnership with the United Nations Conference on Trade and Development, the United Nations Economic Commission for Europe and the World Bank, the event will bring together representatives of the private sector, WTO member states and international organizations to discuss how best support trade facilitation implementation.
The GFP meeting will be held at Palais des Nations, Geneva, on 22 April, and will be divided into three thematic sessions.
The first session, ‘Governments’ Priorities: Strategies for Fostering Private Sector Participation in the TFA Implementation Process’ will look at how governments are planning to implement the TFA.
It will focus on how the private sector is consulted and how an effective participation of the private sector can be facilitated to implement the Agreement.
The second session, ‘Priorities, Perspectives, and Expectations from the Private Sector on TFA Implementation’ will assess how the private sector – including large corporates and small and medium-sized enterprises – view TFA implementation. It will look at the potential benefits from a private-sector perspective, and how the sector can contribute to national and international initiatives to implement the agreement.
The third session, ‘International Organizations’ Co-ordination and Partnership for Supporting TFA Implementation’, will provide an opportunity to share information and experiences on how the TFA can be implemented with public-private partnerships in mind, as how national trade facilitation committees can better support this process.
ITC invites all interested stakeholders to join the GFP meeting at the Palais des Nations on 22 April from 9:00. Click here for link to online registration.
The U.S. and India have reached an agreement that promises to pave the way toward global implementation of the WTO Trade Facilitation Agreement (TFA). The breakthrough agreement between India and the U.S. should now make it possible for member countries to begin implementing the requirements of the agreement, providing potentially significant financial benefits to businesses trading goods around the world as local customs procedures are streamlined. The target date for ratification of the agreement is 31 July 2015. Upon ratification by two-thirds of the membership, the agreement will enter into force for all WTO states. Member state will then begin the process of adopting conforming legislation.
The Trade Facilitation Agreement
Concluded in December 2013, the TFA is intended to streamline, and to some extent harmonize, customs clearance procedures around the world by imposing new multilateral disciplines on customs procedures in all member countries. The agreement imposes basic globally applicable principles for transparency, due process, and reasonableness in the development and implementation of customs clearance requirements across a broad spectrum of activities related to importing, exporting, and transiting of goods.
The U.S.-India agreement
While the specific details of the bilateral agreement are not publicly available at this time, a press release from the Office of the U.S. Trade Representative states that there are two key elements of the deal:
the U.S. and India agree that the multilateral TFA should be implemented without conditions, on the basis of a standard legal instrument for implementing new WTO agreements; and
the “peace clause” agreed upon by WTO members in December 2013, under which WTO members will refrain from initiating challenges to certain food security programs under the WTO dispute settlement process, will remain in place “until a permanent solution is found.”
Since announcement of the agreement last December, India has raised concerns that developing countries need greater assurances regarding their ability to maintain government agricultural buying programs and other farm subsidies until an agreement could be reached among WTO members on how to bring such programs into conformity with the body’s trade rules. The U.S. and India had previously disagreed on the form such assurances should take.
Under the new bilateral agreement, the U.S. and India will seek a General Council decision on the two key elements outlined above. A General Council decision will require the consensus of all WTO members. Source:Hogan Lovells International Trade Alert
The World Trade Organisation headquarters in Geneva [AFP Photo]
The World Trade Organization got a surprise setback on Thursday when India, pushing for concessions on agricultural stockpiling, vetoed plans for universal customs rules. The deal could have added $1 trillion and 21 million jobs to the world economy.
The July 31 deadline on the first proposal for major global economic reform in two decades – a series of customs procedures known as “trade facilitation” – left negotiators empty-handed after India refused to sign up to it.
India, with its large number of poor and new nationalist government, had demanded the exclusive right to subsidize and stockpile grains which is not permitted by WTO rules.
The WTO, experiencing what may be its worst setback in its 19-year history, reluctantly admitted defeat.
“We have not been able to find a solution that would allow us to bridge that gap,” WTO Director-General Roberto Azevedo told negotiators in Geneva just hours before the deadline was set to lapse.
Some analysts are of the opinion the failure represents the beginning of a new era of trade deals, which will depend more on individual economies forging their own initiatives, as opposed to attempting to force global reform.
“Today’s developments suggest that there is little hope for truly global trade talks to take place,” Jake Colvin at the National Foreign Trade Council, a leading US business group, told Reuters.
“The vast majority of countries who understand the importance of modernizing trade rules and keeping their promises will have to pick up the pieces and figure out how to move forward.“
Whether or not other countries will pick up the dropped ball and try to move forward despite the loss is not yet clear, but the present mood is noticeably downbeat.
“We’re obviously sad and disappointed that a very small handful of countries were unwilling to keep their commitments from the December conference in Bali, and we agree with the Director-General that action has put this institution on very uncertain new ground,” US Ambassador to the WTO Michael Punke told reporters.
Meanwhile, there is speculation that some countries may decide to go ahead with the plan without India’s support.
However, Azevedo said that while the world’s largest economies had choices on how to respond to the failed talks, the poorest economies would suffer the brunt of the fallout.
“If the system fails to function properly then the smallest nations will be the biggest losers,” he said. “It would be a tragic outcome for those economies – and therefore a tragic outcome for us all.”
The World Trade Organization agreed on Monday this week to side with claims against the United States made by both China and India concerning US-imposed tariffs on products exported to America.
In both instances, the WTO ruled against the US and decided in favor of the major BRICs countries, who for two years now have each asked the organization to intervene and weigh in on America’s use of tariffs to tax certain imports dating back to 2007.
With regards to both cases, the WTO’s judges ruled that the US acted “inconsistent with its agreement on subsidies and countervailing duties,” or taxes imposed on goods sold by “public bodies.”
In China, the panel agreed, US officials improperly levied those taxes against state-owned enterprises that the WTO does not consider to be “public bodies.” Instead, the WTO said, those entities were majority-owned by the Chinese government, but did not perform “government function” or exercise “government authority,” according to the Financial Times. With respect to India, the WTO again agreed that the US was wrong to similarly treat state-owned National Mineral Development Corporation as a public body, according to the International Business Times.
At issue were billions of dollars’ worth of Chinese steel products, solar panels, aluminum, paper and other goods shipped to the US after being taxed as originating from public bodies. The panel’s decision, Reuters reported, “reflected a widespread concern in the 160-member WTO over what many see as illegal U.S. protection of its own producers.”
“China urges the United States to respect the WTO rulings and correct its wrongdoings of abusively using trade remedy measures, and to ensure an environment of fair competition for Chinese enterprises,” China’s commerce ministry said in a statement.
Mike Froman, the US trade representative, responded by saying Washington was “carefully evaluating its options, and will take all appropriate steps to ensure that US remedies against unfair subsidies remain strong and effective”.
Nevertheless, Froman added that the WTO’s ruling in the Indian case constituted at least a partial victory for the US.
“The panel’s findings rejecting most of India’s numerous challenges to our laws and determinations is a significant victory for the United States and for the (US) workers and businesses making these steep products,” he told Reuters. Source: Russia Today.
The 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.
“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.