PH ratifies trade facilitation deal under WTO
The Philippines has ratified the World Trade Organization’s Trade Facilitation Agreement (TFA), an accord seen to significantly benefit local industries given the expected reduction in trading costs globally.
“The President has already approved our TFA. We’re just finalizing the paperwork for the Instrument (of Acceptance),” Trade Secretary Adrian S. Cristobal Jr. said in an interview with the Inquirer on Tuesday.
The submission of the Instrument of Acceptance means that WTO member has completed its domestic process, accepts the agreement, and is prepared to start implementing the TFA. This also means all related Philippine agencies have submitted their certificates of concurrence to the Department of Foreign Affairs.
Cristobal said the government would soon be ready to submit all necessary TFA documents to Geneva.
As of Feb. 12 this year, 69 WTO members have already ratified the TFA.
Once the TFA is ratified by at least two thirds of the WTO members, Philippine products, particularly agricultural goods, are expected to have better chances of competing globally as the agreement calls for the removal of subsidies that give some countries unfair competitive advantage.
Cristobal said there were countries that provided subsidies for their export products. This becomes a disadvantage to developing countries that also export the same products to the same markets but whose governments could not afford to give the same kind of support.
The WTO TFA, a key component of the Doha Development Agenda, aims to speed up the movement, release and clearance of goods across borders. The agreement includes provisions for advance rulings and pre-arrival processing, the use of electronic payment and promotion of the use of a single window, provisions for customs cooperation and coordination, and reduced documents and formalities with common customs standards.
Negotiations on the agreement started in 2004 and will enter into force once two-thirds of the WTO members have completed their domestic ratification process.
The TFA was said to have the potential to increase global merchandise exports by up to $1 trillion a year. Developing countries are expected to benefit significantly from the TFA and capture more than half of the gains.
Once fully implemented, trade facilitation measures are expected to have the greatest impact in terms of improvements in the area of formalities (simplification of trade documents; streamlining of border procedures, and automation of the border process), which may translate to cost savings of 2.8 percent to 4.2 percent.
