Driving Trade-led Recovery: Trade Facilitation & Growth Strategies

1. 15th UN/CEFACT Plenary Session Palais des Nations, Geneva 9-12 November 2009 Policy drivers for trade facilitation instruments: UNCTAD’s perspective Ms. Maria Misovicova Trade Facilitation Section/Trade Logistics Branch Division on Technology and Logistics maria.misovicova@unctad.org

2. Trade facilitation driving trade-led recovery agenda • Global trade projected to fall by 9% in 2009 (UNCTAD) • Tariffs are low due to trade liberalization under the WTO and “spaghetti bowl” of RTAs world-wide • Non-tariff and administrative trade barriers create greater barrier than tariffs • Trade transaction costs associated with import and export procedures amount to 7 to 10 % of the value of goods traded (OECD, 2009)

3. Trade facilitation driving trade-led recovery agenda smetimes.indiatrade.comSpeech of the Commerce & Industry Minister on the announcement of trade facilitation measures.Following is the text of speech of Kamal Nath, Union Minister of Commerce & industry, on the announcement of Trade Facility Measures, in New Delhi on Feb 26:"I am happy to be present with you this morning for certain announcements of trade facilitation measures. Unlike the last four years, when the global economic mood was upbeat, today we meet against the backdrop of a global financial crisis. For the first time in more than a generation, two of the engines of global integration—trade and capital flows—are simultaneously expected to shift into reverse. In an interconnected globalized world, when all nations are being impacted, India too cannot escape unscathed. However, I believe that India will suffer less and recover faster due to the nature of our trade, the diversification of our trade basket, our trade facilitation measures and the proactive steps taken by our Government. Backed by strong economic fundamentals, the stimulus packages announced by the Government will stimulate demand, increase confidence, uplift business sentiment and give a fresh impetus to India’s trade and growth story. Leaders Stress Importance of Trade Facilitation amid Downturn Developing countries, though far from the world’s major financial centres, are being hit hard by the declines in aid, investment and export revenues triggered by the ongoing economic crisis. Amid the downturn, world leaders are calling attention to trade facilitation – which the WTO defines as “the simplification and harmonisation of international trade procedures” – arguing that progress on that front could be critical to helping developing country economies emerge from the current crisis. Speaking at a meeting on trade facilitation last week, EU Trade Commissioner Catherine Ashton called for the international community to help Africa’s small and emerging enterprises reach larger markets abroad.“Business is telling us that trade facilitation needs to be put squarely on the political top table,” Ashton said at the conference, which met in Rome on 22 April. “There is a need for simpler trade procedures so as to reduce delays, cut costs, improve the services offered to consumers, and even get into overseas markets in the first place.” www.ictsd.org ADB to increase trade facilitation programme 09 February 2009 ADB's President Kuroda announces significant boost to trade finance facilitation programme and steps up lending operations in response to crisis. In order to stymie the fallout of global financial meltdown on developing countries, the Asian Development Bank (ADB) will step up its lending operations by several billion dollars to help Asian nations tide over the crisis. In addition, the bank would increase the size of trade facilitation programme from $150 million to $1 billion in 2009. www.tradefinancemagazine.com. China, ASEAN to further promote trade facilitation 2009-10-20 21:10:05 Print NANNING, Oct. 20 (Xinhua) -- China and the Association of Southeast Asian Nations (ASEAN) vowed here Tuesday to boost trade facilitation to build closer economic ties amid the lingering global economic crisis. Surin Pitsuwan, Secretary General of ASEAN, urged customs of China and ASEAN to sign cooperation memorandum as to institutionalize cooperation at custom level to further boost bilateral trade. www.chinaview.cn

4. WTO negotiations on trade facilitation Implementation capacity Commitments Capacity Building

5. Regional trade agreements • Over 421 RTAs world-wide: North-North, North-South, South-South (WTO, 2008) • The Asia-Pacific “noodle bowl”: 151 RTAs, out of which 104 in force with over 40+ containing TF provisions incl. simplification of trade procedures, use of int’l standards, customs cooperation, electronic data exchange (ESCAP, 2009)

6. Evolving concept of trade facilitation At-the-border measures Behind-the-border measures • Simplified and harmonized customs and trade procedures, documents and controls • Transport corridors • Supply chain management • Business facilitation • E-commerce

7. Leaders vs. laggers Great demand for traditional trade facilitation standards and instruments IT should be an enabler of TF reforms, rather than a driver Prevailing gaps in the level of trade facilitation reforms Source: World Bank, Doing Business 2010

8. Guides, handbooks International standards, recommendations and best practices International (multilateral, regional bilateral) treaties, conventions and agreements What international instruments? UN/CEFACT, UNCTAD, ITC, UN RCs… UN/CEFACT, ISO, WCO, ICC… WTO, WCO, IMO, UNECE Transport…

9. Guides, handbooks International standards, recommendations and best practices International (multilateral, regional bilateral) treaties, conventions and agreements Implementation remains a challenge… Implementation UNCTAD, WB, UN RC’s

10. …however, challenge can be an opportunity to • Conduct a gap analysis study on standards implementation • Increase deliverables for “traditional” trade facilitation (standards and recommendations) • Target developing countries and countries in transition • Introduce a more inclusive approach to give the potential user countries an ownership • Introduce two-tiered capacity-building program on TF standards: • awareness-raising for senior-level policy makers; and • technical trainings for experts

11. How UNCTAD fits in? Advocacy Technical assistance and capacity building Collaboration Analytical work

12. Forthcoming events • Multiyear Expert Meeting “Public and Private Partnerships for the Development of Infrastructure for Trade and Transport, Geneva, 8-10 December 2009 • Ad Hoc Expert Meeting on Transit and Landlocked Countries, Geneva, 11 December 2009 • Private Sector Forum on WTO Negotiations on Trade Facilitation, Geneva, February 2010

13. THANK YOU QUESTIONS? www.unctad.org