Implementing the WTO Trade Facilitation Agreement (TFA) could reduce worldwide trade costs by anywhere from 12.5 per cent to 17.5 per cent, according to the OECD , with the greatest benefits accruing in developing countries.
Countries which implement the TFA in full will reduce their trade costs by anywhere from 1.4 to 3.9 percentage points more than those that only implement the minimum requirements.
The greatest opportunities for reductions in trade costs are in low and lower middle income countries.
Trade costs include all tariff and non-tariff costs including transport, border-related and local distribution costs from foreign producer to final user in the domestic country.
The Trade Facilitation Agreement was the most substantive outcome of the WTO’s first multilateral agreement, concluded in December 2013 during the ninth WTO Ministerial Conference in Bali, Indonesia.
The WTO General Council formally adopted the Bali Package measures in November 2014, and the TFA will enter into force once two-thirds of WTO members have completed domestic ratification processes.
The updated OECD Trade Facilitation Indicators are designed to inform governments on potential measures to improve border procedures, reduce trade costs, boost trade flows and reap greater benefits from international trade.
Financial assistance is available to help countries implement reforms.
Nearly $1.9 billion has been disbursed in aid for trade facilitation since 2005, with annual commitments up eightfold between 2005 and 2013.