Cutting red tape key to promote trade within Asia-Pacific: joint UN/ADB report
Reducing trade transaction costs by cutting red tape can bring significant benefits to economies in Asia and the Pacific, according to a new publication from the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) and the Asian Development Bank (ADB).
Designing and Implementing Trade Facilitation in Asia and Pacific, released today in Bangkok at the first Asia-Pacific Trade Facilitation Forum, says that despite falling tariffs and the removal of import quotas, there remain significant costs to international trade associated with unnecessarily complex customs and border procedures, or with inefficient transit arrangements.
Trade facilitation, or "cutting red tape", is increasingly recognized as the key to unlocking further gains from international trade, especially in Asia and the Pacific, where it takes more than three times longer to complete export procedures than it does in developed countries. It is estimated that Asia's intraregional trade could increase by over $250 billion, or about 21%, if trade facilitation reforms were successful in bringing countries in the region, with below-average performance, closer to the regional average.
Designing and Implementing Trade Facilitation in Asia and Pacific aims to support the implementation of trade facilitation measures, and provides operational guidance on how to assess the status of trade facilitation, what measures and reforms are necessary, how to design trade facilitation initiatives, how to implement them at national and regional levels, and which organizations can help in this process.
Noeleen Heyzer, Under-Secretary-General of the United Nations and Executive Secretary of ESCAP, said the joint publication sends a strong signal to regional policy makers in developing countries that ESCAP and ADB stand ready to assist them in improving trade processes.
“The hidden costs of trade are high – in some cases up to 15% of the value of goods traded,” said Dr. Heyzer. “Timely publication of trade regulations, simplification of trade procedures and documents, and improving coordination between relevant government agencies within and across borders can go a long way towards increased connectivity and integration of the region.”
Ravi Ratnayake, Director of Trade and Investment Division of ESCAP, said the book's release was timely as trade facilitation was vital to the region's efforts to boost resilience to external shocks, such as the global economic crisis.
"Trade facilitation, particularly within and across Asia, is an integral part of the rebalancing required to support increased domestic and regional demand as a source of economic growth," said Dr. Ratnayake. "The book is a practical operational guide of what works in getting goods and services moving across our region’s national borders."
ESCAP and ADB pointed to a number of focus areas in which improvements can be made to facilitate trade, including effective publication and administration of existing trade regulations, rationalization of trade procedures and documents, adoption of international product standards, and development of national quality infrastructures to facilitate conformity assessments. Discussions during the Forum would also cover the importance of logistics infrastructure and services, as well as the need to improve regional transit systems, as key elements for intra-regional trade development.
The two-day Asia-Pacific Trade Facilitation Forum brings together about 100 policy-makers, traders and trade facilitation service providers from more than 25 countries across the region.