Negotiations on trade facilitation at the World Trade Organization

Negotiations on trade facilitation at the World Trade OrganizationGeneva, November [email protected]

Draft agreement

10 global trendsTrade facilitation

measuresImplications for

development

Trade Facilitation: Linking global trends and what happens at the WTO



development


1.Exports of manufactured goods• Today 80% of developing

countries’ exports are manufactured goods, up from only 20% two decades ago

2.Globalized production• Intra-company trade• Trade in intermediate products• Logistics part of production process

3.Increased security concerns• Security measures along

the entire supply chain

4.New Geography of Trade• Especially the share of South-South

trade has more than doubled since 1990

5. Regional integration • Increased regional and

transit trade

6.Within Logistics expenditure…inventory

holding decreases, and Transport expenditure increases

7.Technologies• Containerization, shipping networks• Use of computers and Internet

8.Privatizations / concessionsPorts, Shipping lines, Railways, Airlines,

Airports

9.Tariff reductions• For most developing countries’

exports, international transport costs are 2 to 3 times higher than Customs tariffs on imports in developed countries. Aver age

Ar gentina

Ur uguay

Par aguay

Br azil

Chile

Bolivia

Per u

Ecuador

Sur inameVenezuela

Colombia

Tr inidad and Tobago

Bar bados

Gr enada

St Vincent and the Gr enadines

St Lucia

Dominica

Antigua and Bar buda

St Kitts and Nevis

Dominican Republic

Haiti

JamaicaBahamas

Panama

Costa Rica

Nicar aguaHondur as

El Salvador

Belize

Guatemala

Mexico

0%

2%

4%

6%

8%

10%

12%

14%

0% 2% 4% 6% 8% 10% 12% 14%

TARIFF/CUST

International freight

Import Customs duties USA

Source: Miccio/ Perez 2002

10.Negotiations on trade facilitation at the World Trade Organization

1. Manufactured goods

2. Globalized production

3. Security concerns 4. Trade geography 5. Regional

integration 6. Logistics 7. Technologies 8. Privatizations 9. Tariff reductions10. WTO negotiations



development






1. Manufactured goods 2. Globalized production 3. Security concerns 4. Trade geography 5. Regional integration 6. Logistics 7. Technologies 8. Privatizations 9. Tariff reductions10. WTO negotiations

advance ruling


authorized traders


Risk analysis

3. Security concerns


Internet publication

1. Manufactured goods 2. Globalized production 3. Security concerns 4. Trade geography

1. Manufactured goods 2. Globalized production 3. Security concerns 4. Trade geography 5. Regional


5. Regional

integration

“Regional approaches”


Separate release from clearance


7. Technologies

Automated payments,Electronic documents


National Trade Facilitation Committee


Transport costs and trade facilitation more important than tariffs !




integration 6. Logistics 7. Technologies 8. Privatizations 9. Tariff reductions10. WTO

negotiations

… a response to trends in international trade, transport, logistics and technologies !



development


The introduction of ICTs by Customs may encourage smaller companies to also connect to the internet.

Developing ICTs

Developing e-commerce

Reforms of legal regimes that facilitate the use of electronic documents may also modernize other business practices.

Developing Transit

A framework for bank guarantees for transit trade may also generally improve the financial system.

Are poor countries poor because of red tape?

ORIs red tape the result

of a lack of development?

ANSWER: It is both

More income to finance trade facilitation

-> Better trade facilitation-> More Trade-> More income to finance

trade facilitation

Lower Transport Costs-> More trade-> Economies of scale-> Lower Transport

Costs

Better services-> More trade-> More income to

finance infrastructure-> Better services

The “tipping point”: Start with Trade and transport facilitation

Trade and transport facilitation is good

for trade and for development

Development is good for trade

and for trade and transport facilitation



development


Questions?

Documents

Negotiations on trade facilitation at the World Trade Organization