Bottlenecks along trade routes are some of the most stubborn obstacles to economic growth and development. Perishable goods go to waste at the border waiting to clear customs. Trucks carrying cargo in western Africa spend over two thirds of their time just sitting idle, sapping resources and contributing to environmental degradation. Facilitating trade and modernizing customs procedures are essential for increasing prosperity for all.
USCIB partnered with the International Chamber of Commerce (ICC) to hold the ICC and USCIB Customs & Trade Facilitation Symposium: Finding Solutions to Cross-Border Challenges a two-day policy conference that took place in Miami, Florida on February 23 and 24.
TFA: need for speed
With Trade Promotion Authority and Customs reauthorization set to drop soon in the United States Congress, and with the implementation of the World Trade Organization’s landmark Trade Facilitation Agreement (TFA) set to begin in WTO member countries, the time is right for thoughtful discussion on how to facilitate trade and eliminate red tape at the border.
“We’re sitting on the most robust trade agreement we’ve ever had,” said Terry McGraw, chairman of ICC and USCIB, referring to the WTO’s TFA. Throughout the conference, participants agreed that government and business leaders need to work together to get the TFA ratified and approved by two-thirds of WTO member states as soon as possible. Ratification of the agreement is not yet a done deal – only Hong Kong, Singapore and the United States have ratified it thus far.
Private-sector support is crucial for TFA to succeed, and the global benefits of improving trade facilitation will be substantial. The ICC estimates that implementation of the TFA will add $1 trillion to the global economy and create 21 million jobs worldwide, most in the developing world.
“It’s heartwarming for me to see private sector interest in this agreement,” said Linscott during a Q&A session with McGraw.
Finding solutions to cross-border trade
Over 100 representatives from government, business and national customs authorities attended this two-day symposium. Discussions on the first day included introductory remarks by Kunio Mikyuriya, secretary general of the World Customs Organization, Yi Xiazhun, deputy director general of the World Trade Organization and ICC leaders, as well as a keynote address by Mark Linscott, assistant United States Trade Representative for WTO and Multilateral Affairs; a stock-taking session on the WTO’s trade facilitation agreement; an overview of trade logistics and customs regimes and a review of ICC’s trade tools.
The second day featured a keynote breakfast by Customs and Border Protection (CBP) Commissioner Gil Kerlikowske and discussion sessions on the Panama Canal expansion and how best to balance border security with trade facilitation.
“The conference offered an exciting and timely opportunity for government officials and business leaders to discuss policies that improve trade between countries and along supply chains,” said Jerry Cook, vice president of HanesBrands and chair of USCIB’s Customs and Trade Facilitation Committee. “HanesBrands has done a lot of work in this area, and we are committed to finding solutions that make it easier for all companies to do business.”
Support from business is essential
Commissioner Kerlikowske stressed the importance of close collaboration between business and Customs authorities to ensure border security in a cost-efficient manner. He noted that if countries can agree on the same security standards, they can collectively improve trade as well.
Secretary General Mikuriya noted the close collaboration between Customs and ICC, and expressed thanks for business’s efforts on trade facilitation, helping to eliminate illicit trade and improving the efficiency of supply chains.
“I applaud the ICC for its unwavering support for the TFA,” said Mikuriya.
The conference ended with agreement that improving trade facilitation will benefit all businesses and create jobs. But there is still a more work to be done: the TFA must first be ratified, and the private sector’s efforts in convincing governments and the public at large about the benefits of the agreement will be crucial for the agreement’s ratification and ultimate implementation.
Speakers also highlighted the challenges on the ground as business, government and customs officials work on trade facilitation implementation. These include problems with infrastructure, lack of intellectual property rights enforcement, corruption and entrenched red tape at the border. Substantial political will must be marshaled by WTO member countries to change organizational cultures, and participation from business will be required.
“It’s encouraging to hear that a lot of members have worked on these efforts already,” said Rob Mulligan, USCIB’s senior vice president for policy and government affairs. “The private sector must continue to move forward on getting TFA done.”