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The issue of trade facilitation brings the WTO right to the customs’
gate. Traders from both developing and developed countries have long
pointed to the vast amount of red tape that still exists in moving
goods across borders. Documentation requirements often lack
transparency and are vastly duplicative in many places, a problem
often compounded by a lack of cooperation between traders and official
agencies. Despite advances in information technology, automatic data
submission is still not commonplace.
With the lowering of tariffs across the globe, the cost
of complying with customs formalities has been reported to exceed in
many instances the cost of duties to be paid. In the modern business
environment of just-in-time production and delivery, traders need fast
and predictable release of goods. An APEC study estimated that trade
facilitation programs would generate gains of about 0.26% of real GDP
to APEC, almost double the expected gains from tariff liberalization,
and that the savings in import prices would be between 1–2% of
import prices for developing countries in the region.
Analysts
point out that the reason why many small and medium size enterprises
— who as a whole account in many economies for up to 60% of GDP
creation — are not active players in international trade, has more
to do with red tape rather than tariff barriers. The administrative
barriers for enterprises who do not regularly ship large quantities
are often simply too high to make foreign markets appear attractive.
For
developing-country economies, inefficiencies in areas such as customs
and transport can be roadblocks to the integration into the global
economy and may severely impair export competitiveness or inflow of
foreign direct investment. This is one of the reasons why
developing-country exporters are increasingly interested in removing
administrative barriers, particularly in other developing countries,
which today account for 40% of their trade in manufactured goods.
In
all countries, trade facilitation will not only benefit importers and
exporters, but also consumers, who currently face higher prices due to
red tape in their own import administration. Despite many advances,
traders are currently still confronted with severe obstacles in moving
goods across borders, as voiced by the trading community at the 1998
WTO Trade Facilitation Symposium, where private-industry
representatives gave an overview of the wide range of problems they
encounter in their daily trade transactions.
While
the WTO has been always been dealing with issues related to the
facilitation of trade and WTO rules comprise a variety of provisions
that aim to enhance transparency and set minimum procedural standards
(such as GATT Articles V, VIII and X or several provisions in
agreements like the ones on import licensing, TBT, SPS and others),
the WTO legal framework sometimes lacks specific provisions,
particularly with respect to customs procedures and documentation and
transparency issues. As a separate topic, trade facilitation is a
relatively new issue for the WTO. It was added to its agenda less than
five years ago, when the Singapore Ministerial directed the Council
for Trade in Goods “to undertake exploratory and analytical work...
on the simplification of trade procedures in order to assess the scope
for WTO rules in this area”.
A
lot of such exploratory and analytical work has been done since, with
members engaging very constructively in the debate. Delegations agree
that simplifying trade procedures can result in considerable savings
in time, money and human resources that would benefit each and every
economy. Members are also in agreement on the developing countries’
need for substantial and comprehensive technical assistance to
strengthen their administrative capacities and support their national
reform efforts. The importance of such assistance has recently been
underlined by donors and recipients at a WTO Trade Facilitation
Workshop held in May 2001, calling for the development of a more
cooperative and coordinated approach in the future.
Many
delegations consider trade facilitation as being ripe for negotiations
in the WTO. They believe that after more than four years of exploring
and analyzing the scope for WTO rules on this issue, it is now time to
move to the next stage and enter the negotiating phase. A group of
members advocating the negotiation of new binding trade facilitation
rules proposed a two track approach, centered around commitments on
border and border-related procedures to expedite the movement, release
and clearance of goods. Such rules are suggested to build upon
existing WTO provisions (in particular GATT Articles V, VIII and X)
and principles such as transparency and due process, simplification,
efficiency and non-discrimination. The proposal further provides for
the development and implementation of a comprehensive technical
assistance program in parallel to negotiations.
On
the other hand, there are many developing country members, which,
while generally supportive of the objectives of trade facilitation, do
not want to take on new legal commitments in the WTO at this point in
time. They are concerned that additional rules will exceed their
implementation capacities and expose them to dispute settlement.
Several delegations also voiced scepticism as to whether there is the
need for new binding rules. Some further indicated a preference for
trade facilitation work on the national, bilateral or regional level.
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