Trade Facilitation and WTO
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Transcript of Trade Facilitation and WTO
Negotiations on trade facilitation Negotiations on trade facilitation at the World Trade Organizationat the World Trade Organization
Three presentationsThree presentations
1) Linking global trends and what happens at the WTO
2) Trade Facilitation: An Introduction3) Trade Facilitation at the WTO
[email protected] Geneva, April 2011
Three presentationsThree presentations
1) Linking global trends and what happens at the WTO
2) Trade Facilitation: An Introduction3) Trade Facilitation at the WTO
[email protected] Geneva, April 2011
10 global trendsTrade facilitation
measuresImplications for
development
Trade Facilitation: Linking global trends and what happens at the WTO
10 global trendsTrade facilitation
measuresImplications for
development
Trade Facilitation: Linking global trends and what happens at the WTO
Loooong term
1.1.Exports of manufactured goodsExports of manufactured goods• Today 80% of developing
countries’ exports are manufactured goods, up from only 20% two decades ago
2.2.Globalized productionGlobalized production• About 1/3 of global trade is
intra-company trade• Around 30% of trade is
trade in components and unfinished goods
3.3.Increased security concernsIncreased security concerns• Security measures along
the entire supply chain
4.4.New Geography of TradeNew Geography of Trade• Especially the share of South-South
trade has doubled since 1990
6.6.Within Logistics expenditureWithin Logistics expenditure…inventory
holding decreases, and Transport expenditure increases
Data for USA, via DOT
8.8.Privatizations / concessionsPrivatizations / concessionsPorts, Shipping lines, Railways, Airlines,
Airports
9.9.Tariff reductionsTariff 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
10.10.Negotiations on trade facilitation Negotiations on trade facilitation at the World Trade Organizationat 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
10 global trendsTrade facilitation
measuresImplications for
development
Trade Facilitation: Linking global trends and what happens at the WTO
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
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
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
authorized traders
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
Risk analysis
3. Security concerns
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
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 integration 6. Logistics 7. Technologies 8. Privatizations 9. Tariff reductions10. WTO negotiations
5. Regional
integration
“Regional approaches”
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
Separate release from clearance
Waiting trucks at a border
0%
20%
40%
60%
80%
100%
Admin.Transport
Inventory
Admin. 4% 4% 4% 4% 4% 4%Transport 47% 53% 53% 57% 59% 63%Inventory 49% 44% 43% 39% 37% 33%
1980 1985 1990 1995 2000 2005
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
7. Technologies
Automated payments,Electronic documents
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
Customs to accept commercial information, information platforms
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
Transport costs and trade facilitation more important than tariffs !
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
… a response to trends in international trade, transport, logistics and technologies !
10 global trendsTrade facilitation
measuresImplications for
development
Trade Facilitation: Linking global trends and what happens at the WTO
Trade and Transport Facilitation is not Trade and Transport Facilitation is not only good for trade but also has other only good for trade but also has other
positive side effectspositive side effects The introduction
of ICTs by Customs may encourage smaller companies to also connect to the internet.
Trade and Transport Facilitation is not Trade and Transport Facilitation is not only good for trade but also has other only good for trade but also has other
positive side effects (cont.)positive side effects (cont.) Capacity
building raises the country’s overall human capital.
Trade and Transport Facilitation is not Trade and Transport Facilitation is not only good for trade but also has other only good for trade but also has other
positive side effects (cont.)positive side effects (cont.) A framework for
bank guarantees for transit trade may also generally improve the financial system.
Trade and Transport Facilitation is not Trade and Transport Facilitation is not only good for trade but also has other only good for trade but also has other
positive side effects (cont.)positive side effects (cont.) A single window experience for
trade may help to introduce single windows elsewhere.
Trade and Transport Facilitation is not Trade and Transport Facilitation is not only good for trade but also has other only good for trade but also has other
positive side effects (cont.)positive side effects (cont.) Reforms of legal regimes
that facilitate the use of electronic documents may also modernize other business practices.
Trade and Transport Facilitation is not Trade and Transport Facilitation is not only good for trade but also has other only good for trade but also has other
positive side effects (cont.)positive side effects (cont.)
Mechanisms to consult with stake holders may be beneficial for other policy decisions as well.
Trade and Transport Facilitation is not Trade and Transport Facilitation is not only good for trade but also has other only good for trade but also has other
positive side effects (cont.)positive side effects (cont.) Increased transparency is good for
good governance in general.
Trade and Transport Facilitation is not Trade and Transport Facilitation is not only good for trade but also has other only good for trade but also has other
positive side effects (cont.)positive side effects (cont.) Are poor countries poor
because of red tape?OR
Is 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
The “tipping point”: Start with The “tipping point”: Start with Trade and transport facilitationTrade 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
10 global trendsTrade facilitation
measuresImplications for
development
Trade Facilitation: Linking global trends and what happens at the WTO
Questions?Questions?
Three presentationsThree presentations
1) Linking global trends and what happens at the WTO
2) Trade Facilitation: An Introduction
3) Trade Facilitation at the WTO
[email protected] Geneva, April 2011
• Scope of Trade facilitation
• Traders’ main concerns
• At the border• Key areas of work
Trade Facilitation: An Introduction
• Scope of Trade facilitation
• Traders’ main concerns
• At the border• Key areas of work
Trade Facilitation: An Introduction
TRADE FACILITATION
Process of eliminating all unnecessary elements and duplications in formalities, processes and procedures
Simplification Harmonisation
Alignment of national procedures, operations and documents with international conventions, standards and practices.
Standardisation
Process of developing internationally agreed formats for practices and procedures, documents and information.
TRADE FACILITATION
Standardisation
Process of developing internationally agreed formats for practices and procedures, documents and information.
International rules and standardsInternational rules and standards
• IMO
• ISO
• UN-CEFACT
• WCO
• WTO
TRADE FACILITATION
Process of eliminating all unnecessary elements and duplications in formalities, processes and procedures
Simplification Harmonisation
Alignment of national procedures, operations and documents with international conventions, standards and practices.
Standardisation
Process of developing internationally agreed formats for practices and procedures, documents and information.
TRADE FACILITATION
Harmonisation
Alignment of national procedures, operations and documents with international conventions, standards and practices.
TRADE FACILITATION
Process of eliminating all unnecessary elements and duplications in formalities, processes and procedures
Simplification Harmonisation
Alignment of national procedures, operations and documents with international conventions, standards and practices.
Standardisation
Process of developing internationally agreed formats for practices and procedures, documents and information.
TRADE FACILITATION
Process of eliminating all unnecessary elements and duplications in formalities, processes and procedures
Simplification
• Scope of Trade facilitation
• Traders main concerns
• At the border• Key areas of work
Trade Facilitation: An Introduction
What do traders want ?What do traders want ?• Simple and smooth processing of formalities• Means to allow goods to proceed promptly
to their final destination. No longer itineraries, no unpacking, no delays
• A single control point for all public services• Standard forms, assembled into a ‘single
bunch of documents’, compatible with trade documents and transport contracts
• Predictable and transparent rules and procedures
Arrival Notice
Letter of InstructionInvoice, PO
Importer’s Bank
Ocean Carrier
Customs House Broker
Line of CreditProforma Invoice
Shipping & funding detail
Cargo Status
Vessel Booking Request
CargoStatus
Shipping & Funding Detail
Exporter’s Bank
Importer Exporter
Vessel Booking ConfirmationBill of Lading
Rated Bill of Lading
Dock Receipt
Freight Forwarder / NVOCC
Purchase Order
LCConfirmation
AES
Dock receipt
Pick-up & Delivery Order
Vessel Manifest
Dock receipt
Release/Approval
Demurrage guarantee & payment
Inland Carrier
Manifest
Pick-up & Delivery Order
Importer Notice
Converted VesselManifestCustoms (Export)
Port
Customs ( Import )
Original B/L, Invoice, PO, Packing List
Inland Carrier
Marine Insurance Company
Fund Transfer
Confirmed Line of Credit
Release/HoldNotice
Purchase Exportation Importation
ImportTerminalOperator
Proforma Invoice
Export Declaration
Export Declaration
Bill of lading, Documentation
Import Docs
Export Terminal Operator
• 20 actors;• > 200 data
elements;• Manual procedures;• Multiple data
systems;• > 30 documents or
messages.
Data exchangeData exchangein International Tradein International Trade
Too many documents…Too many documents…• Enquiry• Order• Despatch advice• Collection order• Payment order• Documentary credit• Forwarding instructions• Forwarder's invoice• Goods receipt• Air waybill• Road consignment note• Rail consignment note• Bill of lading
• Freight invoice• Cargo manifest• Export licence• Exchange control doc.• Phytosanitary certificate• Veterinary certificate• Certificate of origin• Consular invoice• Dangerous goods
declaration• Import licence• Customs delivery note• TIR carnet
PRE-ARRIVAL & ARRIVAL INFORMATIONPre-Arrival• Vessel’s characteristics or ship’s particulars, kind and tonnage of cargo, vessel’s ETA and master’s requests must
be notified to the Harbour Master Department every 48hrs, 24hrs or at least six hours prior to vessel’s arrival at the port’s anchorage areas.
Arrival• The component of the committee that performs vessel clearance consists of 10 members from Harbour Master
Department, Department of Customs and Excise, Immigration Police, National Shipping Agency and Broker, and Quarantine Authorities. Ten copies of cargo manifest are required to be provided to the Department of Customs and Excise.
• Entry permit (arranged by official shipping agency), • Last port clearance certificate, • 15 lists of last port of call (at least 10 last ports), • 5 declarations of vessel’s arrival, • 10 import cargo manifests, • 3 bills of loading, • 2 transit cargo manifests, • 7 crew lists, • 7 passenger lists, • 3 lists of vessel’s provisions, • 3 lists of crew personal effects, • 1 copy of health declaration certificate, • 1 copy of vaccination list, • 1 copy of drugs and narcotic list, • 1 copy of fresh water origin, • 3 cargo plans, • 1 copy of valid original ship’s certificates, • Certificate of vessel's registration,
– International load line certificate, – International tonnage certificate, – International oil pollution prevention certificate, – Cargo vessel safety equipment certificate, – Cargo vessel safety construction certificate, – Cargo vessel safety radio certificate, – Minimum safe manning certificate.
• Exemption Certificate (to be inspected by quarantine officers ).
• Scope of Trade facilitation
• Traders main concerns
• At the border• Key areas of work
Trade Facilitation: An Introduction
Crossing theCrossing the
Country Destination
BORDER
Commercial regulationsand practices
Traffic regulationsand operational practices
Vehicle standardsand regulations
Design, construction,maintenance and inter-operability
Country Origin
SERVICES
OPERATIONS
VEHICLES
INFRASTRUCTURE
GOODS Products conformity,standards & regulations
Infrastructure
Operations
Services
Vehicles
Goods
Fina
nces
Custo
ms
Comm
erce
Indu
stry
Inter
ior
Trans
port
Fore
ign A
ffairs
Cham
bers
of C
om.
• Scope of Trade facilitation
• Traders main concerns
• At the border• Key areas of work
Trade Facilitation: An Introduction
Role assigned to CustomsRole assigned to CustomsRevenue Collection of import taxes (duties & excise)
Protection of society <health, safety> (drug trafficking, firearms, environment, counterfeit etc.)
Economic development <trade, investment> (trade facilitation)
Protection of Economic Interests (domestic production & services industry)
Security <terrorism>(shifting focus to supply chain)
CCUUSSTTOOMMS S FFUUNNCCTTIIOONN
Functional linkagesFunctional linkages
CustomsCustomsAutomationAutomation
CustomsCustomsTime ReleaseTime Release
RiskRiskAssessmentAssessment
SingleSingleWindowWindow
Post-auditPost-auditControlsControls
AdaptedAdaptedH.S.H.S.
StandardizedStandardizeddocumentationdocumentation
SequencingSequencing
ID Linkages betweenTrade Facilitation measures
Q2 05
27.3
1 Standardization and simplification
2 Introduction of single administrativedocument (SAD)
3 Computerization and automation of Customsprocedures
4 Risk management, pre-arrival processing andpost-clearance audit
5 Customs-related judicial or administrativemeasures
Q4 04
13.22.1 30.116.1 10.46.2
Q1 05
20.27.11 3.46.35.12 9.1 27.2 13.3 20.323.1
Cooperation at the Cooperation at the national national levellevel
• Between the government institutions concerned by foreign trade: Finance, Commerce, Transport
• With the trading community: importers and exporters
• With service providers: transport operators, banks, insurance companies…
Cooperation at the Cooperation at the regionalregional levellevelBORDERCountry A
GovernmentAuthorities
Min. Trade,Finances (Customs),Transport, Interior,
Foreign Affairs, etc.
Private sectorChambers of Commerce,professional associations,corridor-based interests
(around projects such as:ICD, Free Zones, etc.)
NTTFC, Clusters,Public-Private Partnerships
Country BGovernmentAuthorities
Min. Trade,Finances (Customs),Transport, Interior,Foreign Affairs, etc.
Private sectorChambers of Commerce,professional associations,corridor-based interests
(around projects such as:ICD, Free Zones, etc.)
NTTFC, Clusters,Public-Private Partnerships
Bilateral consultationson trade & transport issues
Professional networks
Regionalcoordination
• Scope of Trade facilitation
• Traders’ main concerns
• At the border• Key areas of work
Trade Facilitation: An Introduction
Questions?Questions?
Three presentationsThree presentations
1) Linking global trends and what happens at the WTO
2) Trade Facilitation: An Introduction3) Trade Facilitation at the WTO
[email protected] Geneva, April 2011
From early 70’s to 1996…From early 70’s to 1996…• Work of the UNECE and UNCTAD
– UNECE Recommendations– UNCTAD FALPRO
• UN International Symposium on Trade Efficiency (UNISTE) in Columbus, Ohio (1994):– Banking & Insurance;– Customs;– Business Information for Trade;– Transport;– Telecommunications.
Existing non-compulsory Existing non-compulsory international instrumentsinternational instruments
and best practicesand best practices• Internationally-accepted customs and practices,
negotiated by interested Governments through international organizations and private sector institutions: WCO, ECE, IMO, ICC-UNCTAD …
• However: Lack of effective implementation of the instruments.
• Non-binding feature of these commitments.
Existing non-compulsory Existing non-compulsory international instrumentsinternational instruments
and best practicesand best practices• Internationally-accepted customs and practices,
negotiated by interested Governments through international organizations and private sector institutions: WCO, ECE, IMO, ICC-UNCTAD …
• However: Lack of effective implementation of the instruments.
• Non-binding feature of these Non-binding feature of these commitments.commitments.
GATT 1994 (i.e. binding WTO)GATT 1994 (i.e. binding WTO) Article V Freedom of Transit Article VIII Fees and Formalities connected with
IMP/EXPortation Article X Publication and Administration of Trade Procedures Agreement on the Implementation of Article VII (Customs
Valuation); Agreement on Preshipment Inspection; Agreement on Import Licensing Procedures; Agreement on Rules of Origin; Agreement on Technical Barriers to Trade; Agreement on Sanitary and Phytosanitary Measures.
• Work on areas of particular interest to developing countries and LDCs:Identification of TF needs and priorities
““Annex D” - ModalitiesAnnex D” - Modalities
PrioritiesPriorities• Imports/ Exports• Trade partners• Commodities• Mode of
transport• User / provider• Transit /
land-locked
Trade and Transport Facilitation is Trade and Transport Facilitation is “good business” for the countries“good business” for the countries
• It tends to have a high rate of return• However, it requires:
– Infrastructure– Capacities– Initial investment... Which developing countries may
not necessarily be able to assume easily
Negotiating positionNegotiating position
Depends on: • The prioritiespriorities of my own trade and
service providers• The needsneeds to receive assistance or
special and differential treatment
Taking into account Annex DTaking into account Annex D
Costs of implementation
Country priorities
- +- +AccomodateAccomodate
+ -+ -ActiveActive
subj. to.subj. to.T.A. , S&DT.A. , S&D
+ ++ +Pro-activePro-active
- -- -PassivePassivesubj. to subj. to
S&DS&D
Costs of implementation
Country priorities
- +- +AccomodateAccomodate
+ -+ -ActiveActive
subj. to.subj. to.T.A. , S&DT.A. , S&D
+ ++ +Pro-activePro-active
- -- -PassivePassivesubj. to subj. to
S&DS&D
Recent situationRecent situation
• Negotiations in 2 key areas:– Substantive provisions regarding the
Articles– Special & Differential Treatment; and
Technical Assistance & Capacity Building
• Draft Agreement in document TN/TF/W/165
ARTICLE 1: PUBLICATION AND AVAILABILITY OF INFORMATIONARTICLE 2: PRIOR PUBLICATION AND CONSULTATIONARTICLE 3: ADVANCE RULINGSARTICLE 4: APPEAL PROCEDURESARTICLE 5: OTHER MEASURES TO ENHANCE IMPARTIALITY, NON-
DISCRIMINATION AND TRANSPARENCYARTICLE 6: FEES AND CHARGES CONNECTED WITH IMPORTATION AND
EXPORTATIONARTICLE 7: RELEASE AND CLEARANCE OF GOODSARTICLE 8: CONSULARIZATIONARTICLE 9: BORDER AGENCY COOPERATIONARTICLE 9 BIS: DECLARATION OF TRANSHIPPED GOODSARTICLE 10: FORMALITIES CONNECTED WITH IMPORTATION AND
EXPORTATIONARTICLE 11: FREEDOM OF TRANSITARTICLE 12: [CUSTOMS] COOPERATION [MECHANISM FOR [TRADE
FACILITATION AND] [[CUSTOMS][TRADE]] COMPLIANCE]ARTICLE 13: INSTITUTIONAL ARRANGEMENTSARTICLE 14: NATIONAL COMMITTEE ON TRADE FACILITATIONARTICLE 15: PREAMBLE/CROSS-CUTTING MATTERSTRANSITIONAL / SPECIAL AND DIFFERENTIAL TREATMENT PROVISIONS FOR
DEVELOPING COUNTRY MEMBERS AND LEAST DEVELOPED COUNTRY MEMBERS
Three presentationsThree presentations
1) Linking global trends and what happens at the WTO
2) Trade Facilitation: An Introduction3) Trade Facilitation at the WTO
[email protected] Geneva, April 2011Thank You!
Thank You!