Just as global trade was recovering from the supply chain snarl-ups caused by pandemic-era lockdowns, businesses are now tackling more delays and rising costs due to new geopolitical issues and environmental disruption.
Global supply chain issues not only negatively affect how companies operate, they can delay goods and raise prices for consumers also. National Trade Facilitation Committees (NTFCs) can play a crucial role in easing such problems and in helping all countries to participate more efficiently and effectively in global trade.
What are National Trade Facilitation Committees (NTFCs)?
NTFCs are set up by governments to bring together all key players involved in trade including public agencies and business representatives. These committees are mandated for all countries that are members of the World Trade Organization (WTO). Their primary goal is to simplify and streamline the complex procedures that can slow down trade across borders such as customs, paperwork and compliance.
In its latest research paper, Bringing business to the fore: Enhancing private sector participation in NTFCs, the Global Alliance for Trade Facilitation highlights the importance of engaging the private sector in NTFCs.
Drawing on projects in Kenya, Colombia and Jordan, along with insights from private sector interviews, the Alliance report has found that NTFCs with strong public-private collaboration tend to produce more impactful and lasting trade reforms. This is because businesses directly affected by trade policies have a chance to shape new rules and regulations.
This research highlights 5 reasons why governments should include the private sector if they want to use NTFCs to drive successful, sustainable global trade reforms:
1. To give business a voice
Successful NTFCs provide a platform for businesses to collaborate with governments to ensure that trade policies reflect the real challenges companies face. Without the input of businesses, policies may miss the mark, causing unnecessary delays or costs. By involving the private sector in decision-making, NTFCs help make sure that the rules governing trade are more practical and effective. This collaboration results in smoother operations, benefiting everyone from small businesses to large multinational corporations.
2. To build trust and cooperation
Trust is needed for businesses and governments to work together effectively. NTFCs foster this trust by creating regular opportunities for dialogue and problem-solving. When both sides understand each other’s challenges and work together to find solutions, it leads to better outcomes – not only for trade but for the broader economy. In an NTFC, businesses should be seen as equal partners in creating solutions, not just as rule followers.
3. To turn ideas into action
NTFCs are most successful when they are well-organized and structured in a way that encourages meaningful participation from all stakeholders. This means having regular meetings, clear agendas and dedicated teams to keep things running smoothly. These structured processes make it easier to track progress, address issues as they arise and ensure that everyone stays committed to the goals of improving trade. When organized properly, NTFCs can turn ideas into action, rather than becoming mere discussion forums.
4. To track progress and show results
One of the biggest challenges for any initiative is making sure it delivers results. NTFCs that use monitoring tools to track how well they are meeting their goals, such as reducing delays at borders or cutting down on unnecessary paperwork, tend to deliver better results. This transparency is crucial for keeping businesses engaged and motivated. When businesses see that their input is leading to real changes, it strengthens their commitment to working with governments.
5. To drive innovation and growth beyond global trade
The benefits of NTFCs extend far beyond global trade facilitation. These platforms drive innovation by bringing businesses into direct contact with policymakers, encouraging the sharing of new ideas and solutions that can enhance the entire economy. Businesses that regularly engage in cross-border trade often have insights into new technologies or best practices from around the world, for example. Through the NTFC, they can share these insights with governments, leading to more modern, efficient systems that benefit all sectors of the economy.
Why do NTFCs matter beyond global trade?
While NTFCs are primarily set up to improve global trade, their impact goes much further. By improving coordination between governments and businesses, NTFCs can increase efficiency across industries and support economic growth. This is particularly important for countries that rely heavily on trade as a driver of development. More efficient trade processes mean more opportunities for businesses of all sizes to access international markets. This, in turn, can lead to job creation, increased investment and stronger economies.
NTFCs also foster a culture of cooperation and problem-solving that can extend beyond the realm of global trade. When governments and businesses work together to address complex challenges, they invariably build a foundation for tackling other important issues such as infrastructure development, sustainability and social equity.
NTFCs are much more than technical groups that manage trade processes. They are essential platforms for fostering collaboration between governments and businesses, ensuring that policies work for everyone involved. By creating space for dialogue, trust and joint problem-solving, NTFCs contribute not only to better trade practices but to broader economic development and cooperation.
In a rapidly changing world, where collaboration is key to solving global challenges, successful NTFCs can stand out as models of how the public and private sectors can work together for the greater good. Whether you are a small business owner looking to expand into new markets or a government official tasked with implementing policy, the success of NTFCs matters because their impact extends well beyond borders and into the everyday lives of people everywhere.