Non-tariff barriers as obstacles to CEFTA intraregional trade

1. Dr Predrag Bjelić Non-tariff barriers as obstacles to CEFTA intraregional trade International Conference "Regional Trade Integration in South East Europe: Benefits And Challenges"Institute of Economics, Skopje, December 2011

2. NON-TARIFF BARRIERS

3. Defining Non-tariff Barriers ”Let me write an administrative regulation and I do not care who sets the tariffs” Benjamin Arthur Levett “Trought the Customs Maze” 1922

4. Defining Non-tariff Barriers Non-tariff barriers are all measures other than tariffs that can serve as obstacle to international trade, not just restricting it but also “unnaturally” promoting the export from one country, and who’s main aim it the protection of domestic market from foreign competition and not just the alimentation of state budget

5. Defining Non-tariff Barriers Barriers to international trade are only those adopted with the protective aim. Many of the measures are necessary for facilitation of transfer of goods and services in international trade in order to protect the health, well-being and security of people and the environment.

6. Types of Non-tariff Barriers 1. Traditional non-tariff barriers like Quotas, Antidumping measures, Compensatory measures etc. Regulated by GATT 1947 2. Technical barriers to trade derived from standards and technical regulation, include labelling, special packaging requirements etc. 3. Administrative barriers to trade derived from laws and administrative procedures, most important border barriers.

7. Regulation of Non-tariff Barriers • Traditional non-tariff barriers regulated during the GATT 1947; • Technical barriers to Trade partly regulated by WTO TBT Agreement; • Administrative barriers to trade are still not regulated by WTO rules, other international intergovernmental organisation have regulated some aspects of these barriers.

8. Non-tariff barriers in Southeast Europe Source: OECD

9. Administrative barriers

10. Administrative Barriers Definition “Administartive contols imposed to imports” Percy Bidwell All obstacles to trade resulting from restrictive national laws and administrative procedures Predrag Bjelić

11. Administrative Barriers • Legal barriers • Procedural barriers • Border barriers (Customs) • Internal barriers • “Natural” barriers • Policy barriers

12. Procedural barriers • Customs valuation • Application of Sanitary and phitosanitary measures • Rules of origin • Preshipment Inspection • Import licences • Special customs formalities

13. Customs related NTB One customs procedure involves: • 20-30 subjects, • 40 diferent documents, • 200 different data, of which 30 is repeated up to 30 times and • 60-70% of data is reentered at least once. UNCTAD

14. Trade Facilitation Trade Facilitation is an initiative to remove Administrative Trade Barriers OECD Trade facilitation is the “simplification of trade procedures” Trade facilitation includes “activities, practices and formalities involved in collecting, presenting, communicatingand processing data required for the movement of goods in international trade”.

15. Trade Facilitation WTO “Trade facilitation is initiative in WTO to remove administrative barriers to trade” Trade facilitation is a process to “clarify and improverelevant aspects of Articles V, VIII and X of the GATT 1994 with a view to further expeditingthe movement, release and clearance of goods, including goods in transit”.

16. Administrative trade barriers in Southeast Europe • Discrepancy between working hours of Customs and working hours of various inspections; • Excess number of forms and documentations for border control; • Nonrecognition of Quality certificates; • Nonrecognition of mutual technical standards and certificates; • Untransparent excize duties. Source: Chamber of Economy of Montenegro, CEFTA week 2009: To European Integration through Regional Economic Cooperation, podgorica, 2009, p. 22.

17. Measuring Administrative trade barriers 1. World Bank – Trading Across Border Indicators In Doing Business Report 2. World Bank – Logistics Performance Index (LPI) 3. World Economic Forum – The Enabling Trade Index (ETI) in Global Enabling Trade Report

18. World Bank: Trading Across Borders Indicators Source: World Bank, Doing Business 2011 Report, Trading Across Borders Indicators, 2011.

19. Trading Across Borders IndicatorsRanks Rank 1 SINGAPORE Source: World Bank, Doing Business 2011 Report, Trading Across Borders Indicators, 2011.

20. Trading Across Borders IndicatorsData SEE

21. World Bank: Logistics Performance Index 2010 Source: World Bank, Logistic Performance Index, Intenet, http://info.worldbank.org/etools/tradesurvey/mode1a.asp, 2010.

22. LPI: Customs efficiency

23. LPI vs. LPI - Customs efficiency

24. World Economic Forum: The Enabling Trade Index (ETI) 1. The market access subindexmeasures the extent towhich the policy framework of the countrywelcomes foreign goods into the economy andenables access to foreign markets for itsexporters. 2. The border administration subindexassesses theextent to which the administration at the borderfacilitates the entry and exit of goods. 3. The transport and communications infrastructuresubindex takes into account whether the countryhas in place the transport and communicationsinfrastructure necessary to facilitate the movementof goods within the economy and acrossthe border. 4. The business environment subindexlooks atthe quality of governance as well as at the overarchingregulatory and security environment

25. World Economic Forum: The Enabling Trade Index (ETI)

26. The Enabling Trade Index (ETI) Source: World Economic Forum, The Global Enabling Trade Report, 2010, 2009, 2008.

27. The Enabling Trade Index (ETI) BORDER ADMINSTRATION SUBINDEX Source: World Economic Forum, The Global Enabling Trade Report, 2010, 2009, 2008.

28. Contact details Dr. Predrag Bjelić THANK YOU FOR YOUR ATTENTION! Faculty of Economics University of Belgrade Kamenička 6 11000 Beograd Serbia t. +381-11-3021044 f. +381-11-2639560 m. +381-65-3835943 e. bjelic@ekof.bg.ac.rs