Implementing the WTO Trade Facilitation Agreement in SADC: Promise and Pitfalls
The World Trade Organisation (WTO) considers the Trade Facilitation Agreement (TFA), reached in Bali, Indonesia, in December 2013, to be a considerable achievement. An official research paper published by the WTO at the end of September points out that the TFA, the product of a contentious 10 year process, has ‘been hailed as a breakthrough for global (trade) facilitation reforms’. It promises to cut back needless red tape in international trade and thus, according to calculations performed by economists at the OECD, lower trade transactions costs by up to 15 percent.
Although trade facilitation reforms are on-going, often in a piecemeal fashion, in many countries, the TFA has not entered into force yet, although that may be only a matter of months away. That point will mark the proper test of countries’ commitment to genuine reform. The question is whether the TFA will make a real impact and really spur a dramatic increase in the movement of goods and services across borders?
This Trade Brief provides an overview of the TFA process and the obligations that will be implemented by SADC countries when the TFA becomes operational. It goes on to consider the relationship between the TFA and other trade facilitation processes already underway in the region, identifying the major hurdles to improving trade facilitation and thus to full implementation of the TFA.
Underpinning the discussion is the observation that trade facilitation is not new to SADC. Indeed the 1996 SADC Trade Protocol undertook to ‘eliminate barriers to trade within eight years’ and committed countries to refrain from imposing any new non-tariff barriers (NTBs). Even the most generous observers believe the process has been slow, halting and has a long way to go. It is not unreasonable to ask whether the TFA will make much difference.
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