This paper presents the state of play of trade facilitation endeavours around the world at the moment of entry into force of the WTO Trade Facilitation Agreement, based on 2017 TFI data. It identifies strong and weak points of those endeavours and highlights advances achieved since the last iteration of the TFIs.

The potential of trade facilitation measures to reduce the time, cost and uncertainty involved in importing and exporting, improve the operation of international value chains, and promote a more efficient production and allocation of resources is well known. Implementation of the WTO Trade Facilitation Agreement (TFA), which entered into force on 22 February 2017, is expected to generate trade cost reductions of between 14% and 18%, boosting global growth and leading to significant welfare gains.

At the moment of entry into force of the TFA, the OECD Trade Facilitation Indicators (TFIs) offer a snapshot of the state of play on trade facilitation around the world, highlight the main advances and challenges that countries will have to address on their path to implementing measures in areas covered by the Agreement, and provide a baseline for monitoring future progress on trade facilitation. The OECD TFIs are the most precisely targeted tool for monitoring and benchmarking country performance on trade facilitation and their extensive coverage of the full spectrum of measures related to the TFA's substantive provisions for more than 160 countries positions them to potentially play an important role in supporting TFA implementation and accompanying technical assistance and capacity building efforts. While the TFIs seek to measure effective trade facilitation endeavours, based on worldwide best practice in the areas covered by the WTO TFA, they are not designed to assess the compliance of countries with specific TFA provisions.

The 2017 iteration of the TFIs shows that in early 2017, implementation of measures falling under significant portions of the TFA is well under way. The evolution from the worldwide trade facilitation performance observed in 2015 to the performance in 2017 confirms the positive momentum generated by the negotiation and adoption of the TFA.

The most challenging areas across the board remain those related to internal and external border agency co-operation, which remain work in progress around the world. Deepening the TFIs in these areas enabled the identification of more specific implementation challenges, such as sharing results of inspections and controls among agencies involved in the management of cross-border trade, control delegation, or coordinated and shared infrastructure and equipment use at the domestic level. Significant progress has been achieved on cross-border cooperation since 2015 in the alignment of working days and hours and the alignment of procedures and formalities, but other areas remain difficult for most countries around the world.

Progress on a number of policy areas, such as advance rulings or automation, appear to be closely related to income, with less advanced economies faring less well than more advanced ones, suggesting that investments in extensive capacity building in these areas are likely to yield considerable benefits. On the other hand, worldwide performance is relatively even in areas such as disciplines on fees and charges and the streamlining of border procedures. Regional averages confirm the picture from income group averages. Beyond internal and external border agency co-operation, formalities (documents, automation and procedures) and information availability also present challenges in all regions.

High and low performers can be found in all income groups, and performance within groups is far from homogeneous. Policy areas displaying a wider variation, including the involvement of the trade community, advance rulings, appeal procedures, automation, and border agency co-operation, may suggest greater challenges as regards implementation.

Observations based on the 2017 TFIs appear to be very much in line with the categorisation notifications submitted up to now by WTO Members. Of the approximately 36 notifiable TFA measures, almost 80% received immediate implementation pledges by over 50% of eligible Members. Many of the measures notified under Category A correspond to areas where the TFIs indicate that good progress has already been made.

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Key policy messages

• Implementation of the WTO Trade Facilitation Agreement (TFA), which entered into force on 22 February 2017, is expected to generate trade cost reductions of between 14% and 18%, boosting global growth.

• At the moment of entry into force of the TFA, the OECD Trade Facilitation Indicators (TFIs) offer a snapshot of trade facilitation endeavours around the world, highlight the main advances and challenges that countries will have to address on their path to implementing measures in the areas covered by the Agreement, and provide a baseline for monitoring future progress on trade facilitation.

• The 2017 series of the TFIs show that, in early 2017, implementation of measures in areas covered by the TFA provisions is well under way. The biggest challenges lie in the areas of domestic and cross-border agency co-operation, while notable improvements have been achieved in other areas such as involvement of trade community, automation or streamlining of procedures.

• A number of policy areas, such as advance rulings or automation appear to be closely associated with income, suggesting that investments in extensive capacity building in these areas are likely to yield significant benefits. But high and low performers can be found in all income groups and performance within groups is far from homogeneous in most policy areas.

• Observations based on the 2017 TFIs appear to be very much in line with the categorization notifications submitted up to now by WTO Members under the TFA. Many of the measures notified under Category A correspond to areas where good progress has already been made, according to the TFI data.

• The progress demonstrated in the 2017 TFIs over the 2015 data indicates continued positive momentum on trade facilitation worldwide. It is expected that, as countries see benefits from reforms undertaken to date, along with the recent entry into force of the TFA, will spur even greater efforts towards full and timely implementation of the TFA, with the boost to global growth it promises to bring.