The collapse of global trade, murky protectionism, and the crisis:

VOX
Research-based policy analysis and commentary from leading economists
achieving practical trade facilitation reform has become a key development issue in
recent years. This has been reflected in the decision to overhaul and modernize the
now over 50 year old WTO trade facilitation rules as part of the Doha round. What
follows is a brief account of where those negotiations stand and how they could provide
a springboard for a G20-facilitated effort to cut red tape during this global economic
downturn.
The WTO trade facilitation negotiations: state of play
Since the negotiations began, WTO members have submitted proposals for new rules
on the freedom of transit of goods, the fees and formalities faced by traders, and the
publication and administration of trade regulations and customs rules, respectively
Articles V, VIII and X of the GATT agreement. The proposals cover measures that are
considered relatively easy to implement (such as publishing rules and regulations on
the internet) to potentially far more complex and resource intensive ones (such as the
implementation of electronic single window regimes). Moreover, and perhaps reflecting
a growing consensus on the benefits to be obtained from a positive and ambitious
outcome, negotiations have been conducted in a spirit of cooperation and compromise
frequently not evident in other areas of negotiation.
Whatever commentators might think about progress, or lack of it, in the overall
Doha Round, the trade facilitation negotiations have made significant progress and
the prospects for securing agreement on a practical range of new disciplines appear to
be good. Indeed, in several cases industrialized and developing countries have submitted
joint proposals. Trade facilitation is therefore not an issue that splits countries
strictly across levels of development, which is important to bear in mind when considering
the role of the G20 whose members are drawn from the industrialized and
developing worlds.
The key to concluding negotiations on the content of a new accord on trade facilitation
will, however, depend in large part on dealing effectively with the remaining
concerns of developing and Least Developed Country (LDC) members about the
potentially high costs and difficulties they will likely face during implementation.
Essentially, developing countries recognize the trade enhancing benefits of implementing
the measures under negotiation but want some form of guarantee that the
necessary technical assistance and capacity building support will ultimately be made
available as and when it is needed.
Dealing successfully with the concerns of developing countries presents some real
challenges. While the development community is already providing significant and
growing levels of support for trade facilitation reform, they are cautious about specifically
linking such support to hard commitments in a new WTO agreement. Many
donors have worked hard to develop practical mechanisms for client engagement and
dialogue, in keeping with the Paris Declaration principles, and would be reluctant to
see these modalities abandoned in favour of expedient but less sustainable and effective
mechanisms simply in order to secure agreement. In addition, many donors
already have extensive trade facilitation programs and do not want the rather narrow,
yet significant, WTO agenda crowding out the sort of deep and comprehensive
reform initiatives that are typically financed through existing bilateral and multilateral
channels.
The issue therefore is not whether finance for implementation of trade facilitation
related reforms would be made available, but whether negotiators can agree on appro-
100