Third Anniversary of Trade Facilitation Agreement Sees Increasing Implementation Rate

Three years since the Trade Facilitation Agreement (TFA) entered into force on 22 February 2017, WTO members have continued to make steady progress in its implementation. Director-General Roberto Azevêdo, on the occasion of the TFA’s third anniversary, welcomed members’ efforts to ensure traders can reap the full benefits of the Agreement.

The TFA, the first multilateral deal concluded in the 25-year history of the WTO, contains members' commitments to expedite the movement, release and clearance of goods across borders. As of the TFA's third anniversary, 91% of the membership have already ratified the Agreement. It entered into force three years ago when the WTO obtained the two-thirds acceptance of the Agreement from its 164 members.

“Through this landmark reform, WTO members are working to ensure that the global trading system creates more prosperity for people,” Director-General Roberto Azevêdo said. “Delivering easier and faster trade through the TFA is a bright spot in international economic relations. WTO members are building upon the Agreement with continued cooperation and commitment.”

The chair of the Committee on Trade Facilitation, Ambassador Mohammad Qurban Haqjo (Afghanistan), said: “On this third anniversary, we now have a roadmap for the implementation of the Agreement by all developing country members in addition to those members which are already implementing the TFA in full. This is a very significant achievement.”

The Agreement is unique in that it allows developing countries and least-developed countries (LDCs) to set their own timetables for implementing the TFA depending on their capacities to do so. They can self-designate which provisions they will implement either immediately (Category A), after a transition period (Category B), or upon receiving assistance and support for capacity building (Category C).

As of 22 February 2020, over 90 per cent of developing countries and LDCs have notified which provisions they are able to implement after a transition period, and the ones for which they will need capacity-building support to achieve full implementation of the Agreement. Developed countries committed to immediately implement the Agreement when it entered into force.

“We look forward to additional clarity about the implementation of the TFA with the notification by LDC members of their definitive dates for the implementation of Category B provisions,” the chair added.

Based on members' notifications of commitments, 65 per cent of TFA provisions are being implemented today compared to the 59 per cent implementation rate recorded on the Agreement's first anniversary. Broken down, the latest figure equates to a 100 per cent implementation rate for developed members and 64 per cent for developing members. As for least-developed countries, the improvement in the implementation rate is particularly notable at 31 per cent today versus the 2 per cent recorded a year after the Agreement entered into force. The implementation rate for each WTO member can be viewed here.

The Agreement has the potential, upon full implementation, to slash members' trade costs by an average of 14.3 per cent, with developing countries and LDCs having the most to gain, according to a 2015 study carried out by WTO economists. It is also expected to reduce the time needed to import and export goods by 47 per cent and 91 per cent respectively over the current average.

Members have also made strides in establishing the body of information needed to ensure transparency in trade procedures. Roughly half of the membership have submitted information that will help traders understand procedures for import, export and transit, the operation of single windows, use of customs brokers, and customs contact points. Much work remains, including in members' provision of information needed to channel technical assistance and capacity building into areas of implementation that need most help.

A TFA Facility (TFAF) was created at the request of developing and least-developed countries to help ensure they receive the assistance needed to reap the full benefits of the TFA. Further information on TFAF is available at www.TFAFacility.org.