By Francisco X. Santeiro
International trade and access to global markets are key factors contributing to economic growth and business opportunity throughout the world. They are especially beneficial in developing regions like Latin America and the Caribbean.
The World Trade Organization’s agreement that concluded in Bali, Indonesia, in December of 2013 was focused on trade facilitation. The WTO defines trade facilitation as “the simplification and harmonization of international trade procedures”, with “trade procedures” described as the activities and formalities related to the movement of goods in international trade. In simpler language, the trade deal is meant to reduce red tape at international borders and minimize bureaucracy related to customs clearance.
In any successful international trade transaction, transportation and related costs as well as speed to market are key considerations. Tariff reductions have long been the goal of multilateral and bilateral trade agreements. Some observers consider that the Bali trade agreement’s focus on trade facilitation made the agenda unambitious. True perhaps, but trade facilitation can however, if achieved on a global basis, result in significant increases in international trade.It is estimated that effective implementation could boost global trade by $1 trillion; even partial compliance could add nearly 5 percent to the world’s gross domestic product.
Francisco X. Santeiro is the managing director, customs and regulatory …
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