Speeding Up Trade Benefits And Challenges Of Implementing The Wto Trade Facilitation Agreement

The 2015 World Trade Report uses a simulation model of the Computable General Equilibrium (CGE) to estimate the export and GDP benefits of the TFA. As previously reported, the expected trade benefits range from $750 billion to more than $1 trillion per year, with higher values corresponding to faster and more comprehensive implementation (see Table 1). Other estimation techniques – called „gravitational models“ – give even larger estimates of the expected benefits if one starts from full implementation, indicating that the CGE estimates might be a bit conservative. The implementation of the TFA requires several investments, including financial and human resources. Although developed countries have committed themselves to using the necessary means to build the capacity of developing countries, these countries account for 24% of WTO members. In addition, trade facilitation in its cooperation agendas targets other urgent priorities, such as the refugee crisis, environmental degradation, gender equality and others. II- Accelerating trade: the benefits and challenges of implementing the WTO Trade Facilitation Agreement 149 WTO members have already ratified the TFA. As a result, only 14 additional ratifications are needed to secure the full commitment of WTO membership to trade facilitation reforms. Although not bound by law, 10 of these 14 countries have announced their intention to use the provisions of the SDT and have shown their intention to soon be part of the TFA. [12] The Aid for Trade 2019 report confirms that trade facilitation has increased by $219 million compared to 2016. Article 23 of the TFA calls on each WTO member to establish or maintain a „National Committee for Trade Facilitation“ bringing together government authorities, customs and businesses. These committees play a central role in supporting the effective implementation of the TFA to maximize benefits for governments, businesses and consumers. Trade facilitation is the general concept of a set of measures to reduce bureaucracy at borders.

Heavy customs requirements pose real challenges for businesses of all sizes to trade internationally, especially for small and medium-sized enterprises (SMEs). Members of the World Trade Organization have agreed on a pioneering global agreement, known as the Trade Facilitation Agreement (TFA). The TFA entered into force on 22 February 2017. The TFA aims to speed up customs procedures; make trading easier, faster and cheaper; clarity, efficiency and transparency; reduce bureaucracy and corruption; and use technological progress. In TFA as in a marathon, the quick finish is not as important as the finish of the whole race. That is why developing countries and LDCs must ensure a cycle of endurance. To date, developing countries appear to be meeting their commitments on transition periods and TACBs. Nevertheless, this group of countries still faces major challenges in the implementation of technical assistance. LDCs are quite late in this race, as they still need to be completed, even at the early stage of ratification. Since the magnitude of the potential benefits depends on the speed and scale of implementation, the TFA contains provisions that help developing countries to fully comply with the rules.

As the first multilateral trade agreement since the creation of the WTO in 1995, the TFA is also a major breakthrough. Although mega-regional trade agreements such as the Trans-Pacific Partnership (TPP) have recently attracted more attention, the multilateral nature of the TFA means that its effects could ultimately be more extensive. The commercial costs to be managed by the TFA are significant and vary considerably from region to region. .