Trade Facilitation and Regional Trade Agreements in Asia-Pacific

by Yann Duval, Trade and Investment Division,

UNESCAP

ASIA-PACIFIC TRADE FACILITATION FORUM 2009, 25-26 November, BANGKOK, THAILAND

Session 3: Regional Cooperation for Trade Facilitation: Learning from and Building on Existing Initiatives

Presentation Outline

BTAs/RTAs in Asia-PacificTrade Facilitation and RTAsGood PracticesBuilding on existing regional TF initiatives

Bilateral/Regional Trade Agreements in Bilateral/Regional Trade Agreements in AsiaAsia--PacificPacific

Singapore

Sri LankaSri Lanka

Bangladesh

IndiaRep. of Korea

Lao PDR

Thailand

Australia

Papua New

Guinea

Source: APTIAD, April 2008,

Bangkok Agreement

ASEAN

1977

Philippines

PATCRA

MalaysiaIndonesia

Bhutan

Sri LankaSri Lanka

Maldives

Bangladesh

India China

New Zealand

Brunei Darussalam Cambodia

Indonesia

Lao PDR

MyanmarPhilippines

Viet Nam

Nepal

Marshall Is. Micronesia

Palau

Tuvalu

Cook Is. Fiji Kiribati Nauru Niue Samoa

Tonga VanuatuSolomon Is.

Australia

Singapore

Papua New

Guinea

USA

Chile

Japan

Hong Kong, China

Iran, Is. Rep.

Jordan

Bahrain

EU

Turkey

Afghanistan

© APTIAD, June 2009,

not all PTAs shown

Niger

GCC

MexicoPanama

Peru

Qatar

Canada

Georgia

Kyrgyzstan

Armenia

Kazakhstan

Ukraine

AzerbaijanTurkmenistan

Uzbekistan

Tajikistan

CISFTA

SAFTA

BIMSTECAPTA

AFTA

EFTA

PICTA

SPARTECA

MSG

EurAsEC

NAFTA

MERCOSURSACU

Pakistan

Thailand

Malaysia

2009 ECOTA

Korea,Rep.of.

Macao, China

Russian Fed.

BelarusMoldova

PTAs explosion in Asia-PacificAsia-Pacific

0

2

4

6

8

10

12

14

16

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

PTA

s pe

r ye

ar

0

20

40

60

80

100

120

140

Cum

ulat

ive

PTAsUnder NegotiationCumulative

Interest of countries in Asia-Pacific to negotiate had one peak in mid 1990s and then started to rise exponentially after 2002..Asia-Pacific trend broadly follows global trend

PTAs in Asia-Pacific: number and membership

•150+ trade agreements involving Asia-Pacific countries

•Only one Asian WTO Member (Mongolia) has no PTAs (as yet!)

•Asia-Pacific non-WTO members: from 1 to 11 PTAs

• Average per ESCAP ≅ 6 PTAs in implementation per economy, minimum=0 PTA, maximum= 22 PTA

•Often partners from outside the region

Trade Facilitation in Preferential Trade Trade Facilitation in Preferential Trade ArrangementsArrangements

Increased focus on trade facilitationin PTAs involving Asia-Pacific countries

… but often no specifics, and no harmonization

Even “trade hubs” countries have different provisions in their various BTAs

(what is trade facilitation?)Trade facilitation increasingly mentioned in PTAs (or associated agreements/ frameworks)...

Number of PTAs with Trade Facilitation Provisions

(ADB/ESCAP 2009)

Focus of Trade Facilitation Provisionsof PTAs in Asia-Pacific

(Bin and Misovicova, 2008)

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

(Bin 2008)

1Customs administration and cooperationTechnical regulations and standardsTransparency of laws and regulationsUse of ICT and e-commercFees and formalitiesMobility of business personsFacilitation in transitFacilitation in transport and logisticsFacilitation in payment

Focus of Trade Facilitation Provisionsof PTAs in Asia-Pacific

Number of PTAs w/ TF provisions which include

provision(s) in a particular area

Trade Facilitation and PTAs

“All” East / Southeast Asian PTAs refer in some way to trade facilitation

none of the 1990s agreements between former soviet republics mention trade facilitation

Complex/comprehensive agreements (ANZCERTA or ASEAN FTA) have subsidiary agreements/understandings related to trade facilitationAgreements increasingly mention specific TF measures / standards

Particularly those involving Australia or Singapore

Singapore-Australia Free Trade Agreement

• Trade facilitation measures:• Chapter 4: Simplification of customs procedures• Chapter 5: Harmonisation of technical regulations• Chapter 11: Promotion of paperless trading

•Defining characteristics: • Binding trade facilitation obligations, enforceable by dispute settlement• Cross-reference to pre-existing multilateral agreements and international standards

Trade Facilitation and PTAs: Trade Facilitation and PTAs: Emerging Good PracticesEmerging Good Practices

Trade Facilitation in PTAs: Good Practices (1)

Identify trade regulatory/procedural bottlenecks through stakeholder consultations during negotiation; and Include concrete measures to address themEnsure the provisions are consistent with WTO and other commitments (e.g., Article V, VIII, and X)Refer to established trade facilitation instruments, standards whenever possible (e.g., WCO Revised Kyoto Convention, UN/CEFACT Recommendations, TIR Convention,…)Ensure that the trade facilitation measures included can apply to both members and non-members (committing to administer differentiated trade procedures would likely become problematic)

Trade Facilitation in PTAs: Good Practices (2)

Support/seek provisions on customs cooperation and technical assistance (particularly in case the level of development between partners is significant)Consider including TF measures found to be lacking at the national level, taking into account assessed priority and cost of the measure(s) (to accelerate domestic reforms)Keep rules of origins (RoOs) – and related administration procedures - as simple and transparent as possible

Building on Regional Trade Facilitation Building on Regional Trade Facilitation InitiativesInitiatives

Building on Existing Initiatives (1)

“Most progressive” regional trade facilitation initiatives

ASEANASEAN Single Window initiativeMRAs for conformity assessment

APECTrade Facilitation Action PlansIAP Peer review mechanisms

Can these be emulated by the greater Asia-Pacific region? How could ESCAP and ADB support this?

The Asia-Pacific Trade Agreement (APTA)

Links east, Southeast and South AsiaTrade Facilitation Framework Agreement under negotiationSimple and common RoOs

Simple and common Rules of Origin with minimum local value requirement of 45% f.o.b.

Building on Existing Initiatives (2)

Current Members:BangladeshChinaIndiaLao PDRRepublic of KoreaSri Lanka

Disclaimer: The boundaries shown on this map do not imply official endorsement or acceptance by the United Nations.

Summary and Conclusions

Explosion of number of PTAs in Asia-PacificIncreasing number of PTAs feature trade facilitation provisionsTrade facilitation provisions generally not preferential – should be kept this waySimplifying RoOs important for trade facilitationLarge variety of regional trade facilitation initiatives/agreements to learn fromWidening relevant initiatives/frameworks to the greater Asia-Pacific region may be worth pursuing