Businesses need greater regional support to integrate into global supply chains, recommends Asia Pacific Forum on facilitating trade
Small- to- medium- sized businesses in Asia and the Pacific need regional arrangements that facilitate their entire supply chain, according to recommendations from the Asia-Pacific Trade Facilitation Forum which closed in Beijing yesterday.
The two day Forum included Asia-Pacific policymakers, government officials, trade facilitation service providers, international organizations and development agencies from more than 40 countries, with discussions on more efficient and inclusive supply chains from public and private sector perspectives.
By the end of the discussions, there was wide ranging consensus that reforms to help small-to- medium-sized businesses (SMEs) cannot be limited only to border-related procedures, but need to extend well behind the border. This is to ensure that the business environment is conducive to their direct or indirect participation in international trade, both in terms of the availability of competitive logistics and of financing.
The Forum also recommended that regional arrangements for SME trade finance and cross-border paperless trade should be actively pursued. A draft of a regional arrangement on this is currently being discussed by the member States of the United Nations’ Economic and Social Commission for Asia and the Pacific (ESCAP).
Mr. Ravi Ratnayake, Director, Trade and Investment Division, ESCAP explained: “What is needed is to look at the entire set of import and export related procedures and identify measures that can increase efficiency and inclusiveness. Trade facilitation is not only about making customs or other regulatory procedures more efficient, but finding ways to make the whole supply chain more efficient, including in terms of commercial procedures, transport and logistics, financing and payment processes.”
Mr. Jiang Zengwei, Deputy Minister, Ministry of Commerce, China, emphasized that “with the rapid development of global e-commerce in particular, traditional ways for government to facilitate trade processes may fast become obsolete and there is a pressing need for government to establish a more effective institutional mechanism for trade facilitation.”
Mr. Edy Putra Irawady, Deputy Minister, Coordinating Ministry for Economic Affairs, Indonesia, said that a regional arrangement on enabling paperless trade and the cross-border recognition of electronic data and documents would greatly help integrate SMEs in Indonesia into global supply chains. Such arrangements would also help in reducing trade costs in LDCs and LLDCs.
Limited access to financing was also recognized in the Forum as a key barrier, with initiatives such as the Asian Development Bank (ADB) Trade Finance Programme, (which provides guarantees and loans through banks to support trade in developing countries of the region), highlighted as essential. Participants recommended that complementary regional arrangements such as an Asian trade finance fund or a regional Export Credit Agency be considered as a way to further reduce the costs of trade finance, and spread risk among countries of the region.
This year’s Forum included a high level panel discussion and four thematic sessions on trade logistics, trade finance, paperless trade and single window, respectively. In parallel with the Forum, an exhibition on Trade Facilitation was held to maximize information sharing on practices, case studies and findings of trade facilitation.
The Forum was organized by the United Nations’ Economic and Social Commission for Asia and the Pacific (ESCAP) and Asian Development Bank (ADB), in partnership with the Ministry of Commerce of China and the China International Electronic Commerce Center (CIECC).