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TRADE FACILITATION IN THE WTO DOHA ROUND. John Clarke, Deputy Head of the EC Delegation To the WTO and the UN, Geneva. Overview of presentation. What is Trade Facilitation? Does it matter? Trade facilitation in the DDA The development dimension State of play of negotiations.

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  1. TRADE FACILITATIONIN THE WTO DOHA ROUND John Clarke, Deputy Head of the EC Delegation To the WTO and the UN, Geneva

  2. Overview of presentation • What is Trade Facilitation? • Does it matter? • Trade facilitation in the DDA • The development dimension • State of play of negotiations

  3. What is Trade Facilitation ? Scope: Laws, procedures, fees and practices, documents for import, export and transit Objective: Simplification, standardisation, modernisation – to reduce business costs and time It is not (in WTO): Services liberalisation and infrastructure (building roads, ports, etc.)

  4. Does it matter? Benefits for business • Saves money and time • “Just-in-time” production • Predictability • As trade increases, bottlenecks increase • Costs of “non-facilitation” high for competitiveness • SMEs and developing country firms gain most

  5. Does it matter? Examples Morocco: Release in Casablanca port fell from 20 days to 1-2 hours Mozambique: In two years, revenues increased by over 50% despite significant tariff cuts Peru: Customs revenue more than doubled at same time as tariffs cut. Costa Rica : Clearance from 6 days to 12 minutes Singapore: Customs clearance in minutes. 1% on GDP

  6. Does it matter? Benefits for government • Improve controls and security • Less corruption, higher revenue collection • Better investment climate • Land-locked countries have particular interest

  7. Does it matter? Macro analysis • An additional 1% of world GDP or €300 billion • Bulk of gains, in relative terms, concentrated in South, especially Sub Saharan Africa

  8. Trade Facilitation in the DDA:Why the WTO ? • Trade facilitation is already part of WTO • Boosts domestic reforms • Boosts export market reforms • Setsglobal standards • Mobilises international aid effort • WTO rules are binding and enforceable

  9. Trade Facilitation in the DDA • TF negotiations launched “late”. July 2004 DDA Package. • 5 aims: • Improve transparency: GATT Article X(publication, consultation, appeals…) • Simplify and standardise procedures: GATT Article VIII(risk management, authorised traders, use of international standards, pre-arrival processing, abolition of PSI, …) • Simplify and modernise transit: GATT Article V (landlocked countries, energy…) • Enhance technical assistance • Improve customs co-operation

  10. The development dimension • Need a development focus: technical assistance, flexibilities • To maximise benefit, TF should be part of broad reform programme • BUT significant benefits can result from targetted actions: Better transparency, lower fees; co-ordinated border opening hours; user-friendly documents…

  11. The development dimension: Technical assistance • WTO commitments and technical assistance: • GATT principles tend to be resource light • Other commitments may require automation and be potentially resource intensive • Resources central element of DDA negotiations • Delivery of technical assistance key

  12. The development dimension: Flexibilities • Outcome will be subject to extensive special and differential treatment • Beyond traditional transition periods, with commitments linked to implementation capacity • Tailor-made implementation plans linked to technical assistance

  13. Third country positions Colorado Group – long-standing friends US, Australia, Canada, Chile, Colombia, Costa Rica, EC, Hong Kong China, Japan, Korea, Morocco, New Zealand, Norway, Paraguay, Singapore and Switzerland Core Group – the former sceptics Bangladesh, Botswana, Egypt, Cuba, India, Indonesia, Jamaica, Kenya, Malaysia, Mauritius, Nigeria, Philippines, Rwanda, Tanzania, Trinidad and Tobago, Uganda, Venezuela, Zambia and Zimbabwe

  14. Third country positions China – constructive with offensive interests Latin Americans – increasingly engaged and influential Taiwan – very ambitious Pakistan – very supportive Africa Group, LDCs, ACP,Economies in transition,LLDCs all active as groups, with a focus on obtaining assistance and some flexibility

  15. International organisations Integral part of negotiations: WCO – standards and assistance World Bankand IMF –supportive and active OECD – analysis of proposals UNCTAD – developing country voice and assistance WTO Secretariat

  16. State of play of negotiations • On track • 100+ submissions from 100+ WTO Members • EC has made or co-sponsored 20+ submissions • Hong Kong Ministerial agreed (end 2005) good basis for development of multilateral commitments in 2007 • Aiming for first draft of new WTO Agreement by March • Conclusion later in 2008 along with the rest of the Doha Round

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