Commenting on today’s development, Philippe Isler, Director of the Global Alliance for Trade Facilitation, said:
“Entry into force of the Trade Facilitation Agreement sends a strong signal that countries remain committed to making trade work for all. The agreement represents an enormous opportunity for countries to boost trade-led growth and development and the Alliance looks forward to working with the public and private sectors to ensure it is ambitiously implemented—maximizing its potential benefit to local economies.”
Launched to help developing and least-developed countries implement the TFA, the Global Alliance for Trade Facilitation is an innovative public-private partnership for trade-led growth, which draws on business expertise and resources to support effective border and customs reforms. The Alliance will work to ensure that business has a voice in the implementation of the TFA by enabling the private sector to identify key trade bottlenecks and support associated reforms. The initiative is already working in Ghana, Kenya, Viet Nam and Colombia to assess private sector ideas and suggestions regarding TFA implementation measures.
The Alliance comprises the World Economic Forum, the International Chamber of Commerce and the Center for International Private Enterprise in conjunction with the governments of Australia, Canada, Germany, the United Kingdom and the United States.
About the TFA
The TFA aims to make customs procedures more transparent and efficient, reducing bureaucracy and corruption while taking advantage of new technologies. Research has shown that the TFA could have a greater impact on international trade than the elimination of all the world’s remaining tariffs.
Burdensome customs requirements present a particular challenge to small- and medium-sized enterprises (SMEs) which are often unable to deal with complex paperwork and other border regulations. It is estimated that improvements in border administration could boost global trade flows by US$1 trillion a year creating many millions of new jobs in the process.
Following an almost three-year process, the TFA has entered into force now that two-thirds of WTO members have ratified the agreement—meaning that the deal becomes binding on all ratifying member countries. WTO members collectively represent more than 96% of global GDP.
Unlike other WTO agreements, implementation of the TFA is directly linked to the capacity of countries to fulfill their requirements. Of particular note, the agreement provides developing and least-developed countries with the ability to condition their implementation of TFA provisions on the receipt of assistance and support for capacity building.