Customs & Trade Facilitation
On November 27, 2014, the World Trade Organization (WTO) was finally able to overcome an impasse created by India in July which prevented implementation of the Trade Facilitation Agreement reached in Bali in December 7, 2013. As described by WTO Director General (DG) Azevedo, “the impasse related to the political link between two of the Bali decisions – the decision on Public Stockholding for Food Security Purposes, and the Trade Facilitation Agreement.” The WTO General Council was able to address India’s objections after a breakthrough made by the U.S. and India on November 13, 2014 to simultaneously adopt the protocol necessary to implement the TFA and a decision clarifying the terms of an existing food security “peace clause.” Continue reading
Because of an impasse created by India over food security this past July, which prevented ratification of the Trade Facilitation Agreement (TFA) reached in Bali in December 2013, some questioned the continued viability of the World Trade Organization. On Nov.… Continue reading
This article first appeared in Law360 and has been reprinted here with permission.
World Trade Organization Director-General Roberto Azevedo has offered little hope for overcoming the obstacle presented by India in blocking the protocol necessary to finalize the WTO trade facilitation agreement reached in Bali Dec. 7, 2013. Meanwhile, there is a great deal of discussion about what this means for the WTO, but what does it mean for trade facilitation? I would suggest that while this development means a lot to the WTO it means little to trade facilitation. The train has left the station as far as trade facilitation goes because countries and business appreciate the merits of its implementation.
The majority of people have heard the old saying: “the early bird gets the worm.” Well, the same holds true for trade facilitation – and there are a few good reasons why.
Trade facilitation creates a more efficient supply chain connectivity for improved international trading, builds economic and port infrastructure as well as interconnecting region suppliers in a more fluid and cost-friendly way.
But first, let’s back up a bit and give some history. . .
With the finalization of a Trade Facilitation Agreement (“TFA”) at the conclusion of the 9th Ministerial Conference in Bali, Indonesia, on December 7, 2013 (see: https://mc9.wto.org/system/files/documents/w8_0.pdf), the World Trade Organization (“WTO”) proved that it is not dead. Significantly, the TFA is the first WTO trade agreement concluded since 1998 and the first fully multilateral trade agreement negotiated under the auspices of the WTO. The Organization for Economic Cooperation and Development estimates that these customs reforms would lower the total trade cost of shipping goods by 10 to 15 percent depending upon the country. Some expect implementation of TFA’s measures to boost global trade by an estimated $1 trillion and global GDP by nearly 5 percent. As stated by the Office of the United States Trade Representative, “it makes it easier for businesses big and small to participate in trade around the world – and to support jobs through that trade.” In other words, improved customs procedures and trade facilitation should help all companies, large and small, gain access to new export opportunities by providing predictability, simplicity and uniformity in customs and other border procedures.