Trade Facilitation Agreement

The Trade Facilitation Agreement (TFA), was confirmed in Bali, Indonesia in December 2013 at the Ninth Ministerial Conference.

[1] After almost 20 years of negotiations the agreement was officially an open invitation for acceptance from the 160 members of the World Trade Organisation (WTO) on 27 December 2014.

[1] This reduction of bureaucratic 'red tape' will have favourable effects on small to medium Businesses, making it easier for them to trade and join global value chains.

However, most of the developing and least-developed countries were more in favour of an approach which encouraged these Guidelines to be followed opposed to a mandate of disciplines.

The earliest proposal indicated that the WTO would be in charge of payments, insurance and other financial requirements concerned with international trade.

[2] In the late 1990s an effort from a number of countries to make the WTO rules binding and not encouraged triggered a response to narrow the scope and focus on selected aspects of GATT.

With numerous countries standing in opposition of each other, the ‘Colorado Group’ looking for certain mandates and the rest preferring to build upon three existing GATT disciplines in order to alleviate ‘red tape’ surrounding the trading procedures, the negotiations ended up breaking down.

In the aftermath, efforts were allocated to trying to identify the positives and benefits that the Trade Facilitation Act can have on its members.

The Ministerial in Hong Kong 2005 represented the first concrete point of reference for Trade Facilitation talks.

[2] Those who were in favour of a timely resolution of Negotiations were concerned that an absence of real drafting would continue to delay processes.

Fred Agah from Nigeria had the task of refining article 10 and finally Michael Stone from Hong Kong looked after S&D under section 2.

Just prior to the Bali Ministerial Conference in December, with the direct help of the Director general, the process of drafting had resulted in almost a clean text.

The Ministerial Conference brought more rounds of negotiation and disagreement, however at the end the members were able to agree on a text for the Agreement.

[4] This is due to a variety of factors including, redundant customs procedures, border fees and unnecessary duplications.

[5] It became evident to the WTO that the provisions and mandates indicated the Trade Facilitation Agreement would be more difficult to implement for developing and least-developed countries.

Therefore, the Trade Facilitation Agreement Facility was developed in order to provide assistance and support to these countries.