The Bali package
1 May, 2015, 12:00 am
AFTER months of intense negotiations plagued by intermittent inertia and impasse, the much awaited trade facilitation agreement (TFA) was adopted by the 9th WTO Ministerial Conference in Bali in December 2013.
Also known as the “Bali Package”, the agreement will formally enter into force once two-thirds of the members have completed their ratification process.
Thereafter the TFA will be binding on all 160 member states which also include the six Pacific countries namely Fiji, Papua New Guinea, Samoa, Solomon Islands, Tonga and Vanuatu.
TFA is hailed as a win-win outcome for it has resolved most of the contentious issues. A number of significant changes and special provisions have been made in the TFA for the developing and least developed countries, which the members need to be conversant with in order to take full advantage of the opportunities available to them.
It is designed to streamline border procedures, increase transparency, reduce inefficiencies and improve national competitiveness by reducing red tape, and facilitating Customs procedures in an effort to cut down the cost of doing business.
Trade facilitation is not just about only simplifying the documentation required for clearing of goods but more so about streamlining the procedures employed by the border agencies.
Studies such as the time release surveys have noted that in developing countries despite the effort aimed at facilitating trade, goods continue to be delayed at the border for unreasonably long period thus slowing down trade flows and adding costs to business that are often passed on to the consumers.
There is empirical evidence that trade transaction costs are highest in developing countries.
Towards meeting its obligation to assist developing countries and least-developed countries reap the benefits of the TFA, a new initiative was unveiled by WTO on July 22, 2014.
The aim of this new initiative, called the WTO Trade Facilitation Agreement Facility (TFAF), is to help ensure that this assistance is provided to all those that require it.
While launching the initiative the director general of WTO said: “I am delighted to launch the WTO Trade Facilitation Agreement Facility. With this new facility, developing and least-developed countries can be sure that they will receive the support they need to make the reforms enshrined in the Trade Facilitation Agreement and share in the substantial economic gains that it will deliver.
“I am encouraged by the way this initiative has been received, including by donors, some of whom have already indicated their support or will soon be in a position to do so.
“This is an important day at the WTO. With this initiative we are sending the message again that development is at the heart of our work. It is important now that members implement the Trade Facilitation Agreement Facility so that developing countries can receive this technical assistance and so that we can move ahead with the other elements of the Bali package and negotiations on the Doha Development Agenda.”
Next week we will look at the functions and benefits offered under the facility.
* The writer is a former worker of the FRCA and former Adviser for Trade Facilitation with Oceania Customs Organisation. Views expressed here are those of the writer and do not represent the views of the organisations that he had worked for nor The Fiji Times.