A United Nations report shows that countries around the world have made progress in digitizing international trade procedures during the COVID-19 pandemic, but greater efforts are needed to facilitate trade for small and medium-sized enterprises and other groups and sectors with special needs.
The document entitled "Facilitation of digital and sustainable trade: Global Report 2021" It is based on the United Nations Fourth Global Survey on the subject, carried out jointly by the regional commissions: Africa, Latin America and the Caribbean, Asia and the Pacific, Western Asia and Europe.
The survey covers trade facilitation measures under the World Trade Organization (WTO) Trade Facilitation Agreement, as well as digital trade facilitation measures associated with the Framework Agreement on Facilitation of Cross-Border Paperless Trade in Asia and the Pacific.
Based on the survey covering 144 countries, the report shows that The global average implementation rate of digital trade facilitation measures is 65 percent. It notes that despite the severe impact of COVID-19 on international trade, trade facilitation has made significant progress over the past two years. According to the report, the overall rate of implementation of the measures increased by more than five percentage points between 2019 and 2021.
“Countries should continue and sustain efforts to strengthen cooperation to adapt to the increasingly digital global economy without leaving anyone behind,” said Armida Salsiah Alisjahbana, Deputy Secretary-General of the United Nations and Executive Secretary of the Economic and Social Commission for Asia and the Pacific. “I encourage all leaders to take advantage of all available global and regional mechanisms to move forward, such as the WTO Trade Facilitation Agreement, as well as the Framework Agreement on Facilitation of Cross-Border Paperless Trade in Asia and the Pacific, which is a forward-looking UN treaty that entered into force last year.”
The report also shows that measures related to the WTO Trade Facilitation Agreement are relatively well implemented globally. Furthermore, progress towards paperless and paperless cross-border trade is particularly notable, 64 percent, up 6 percentage points since 2019. However, the implementation of the “Paperless cross-border trade” remains low, of the 38 percent, and bilateral and subregional paperless trade systems remain mostly partial or experimental.
The report finds that digital trade facilitation measures serve as a major catalyst for trade cost reduction. Evidence shows that full implementation of digital trade facilitation beyond the WTO Trade Facilitation Agreement commitments could reduce average trade costs by more than 13 percent, 6,7 percentage points more than what could be expected from compliance with the requirements of the WTO Trade Facilitation Agreement. For this reason, the United Nations suggests that “Countries should work together to develop and put in place the legal and technical protocols necessary for the seamless exchange of regulatory and trade data and documentation.”
In this regard, the report notes that regional and subregional initiatives, such as the Framework Agreement on Facilitation of Cross-Border Paperless Trade in Asia and the Pacific, the expansion of the Association of Southeast Asian Nations (ASEAN) Single Window Agreement and the African Continental Free Trade Area Agreement are initiatives that could help countries gradually move to less paper and then to paperless and paperless cross-border trade by providing an inclusive intergovernmental and capacity-building platform. The implementation of such measures should be based on international recommendations, standards and tools developed by the United Nations Centre for Trade Facilitation and Electronic Business, the United Nations Commission on International Trade Law, the World Customs Organization and other relevant organizations, in cooperation with the private sector.
The report highlights low implementation rates of sustainable trade facilitation measures, or measures targeting specific sectors and groups of traders. While measures for the agricultural sector have been implemented comparatively well, trade facilitation measures targeting small and medium-sized enterprises, as well as women entrepreneurs, face significant challenges, with average implementation rates of 41 and 31 percent, respectively.
The COVID-19 pandemic has revealed many weaknesses in the trading system. The survey results show that most countries have implemented short-term crisis measures. However, the overall level of implementation of the measures in the “Trade Facilitation in Times of Crisis” section is 41 percent, essentially because Many countries still lack long-term trade facilitation plans to improve preparedness for future crises. The report suggests that continued and sustained efforts should be made to further strengthen cooperation, make trade information transparent, and enhance countries' capacity to contribute to transformative recovery for all. (Facilitation of digital and sustainable trade: Global Report 2021)
Aduana News is the first Argentine customs newspaper to launch its digital version. With 20 years of experience, its publications and initiatives aim to provide the most relevant knowledge on customs issues in order to contribute to safe trade in the region.
