Boksburg Group Meeting in China Discusses Challenges of Border Management
Beijing, 22 November 2007
The 9th Meeting of the Boksburg Group ended in Beijing, China with participants calling for greater private sector participation in formulating positions towards the possible conclusion of a World Trade Organization Agreement on Trade Facilitation.
Early this month, the WTO Secretariat published the latest compilation of members’ textual proposals for the negotiations on Trade Facilitation. Considerable progress has been made in this area compared to the negotiations on Agriculture and Non-Agricultural Market Access, where it has been more difficult for developing and developed countries to reach agreement. The proposals cover all the articles within the purview of the Negotiating Group on Trade Facilitation (GATT Articles V, VIII and X).
Border Agency Cooperation
One of the areas where proposals have been made is border agency cooperation. The session on Border Management: Challenges and Case Studies looked at challenges, lessons and case studies of border management from Bolivia and Zambia. Julio G. Alvarado Aguilar, the President of the Bolivian Association on the Political Economy of Globalization presented a paper on The Need for a WTO Trade Facilitation Agreement for Landlocked Developing Countries using Bolivia as a case study. The paper traced the history of Bolivia from the Pacific War of 1879 to 1883 when the country lost its 120,000 km sea access to Chile. This has led to high transport and port facility costs, reduced competitiveness of the economy, and non-tariff barriers to trade. Bolivia has signed bilateral border agreements with Argentina, Brazil, Chile, Paraguay and Peru to facilitate the movement of goods to the sea.
Kingsley Chanda, the CEO of Ciltax Consultants Limited and Project Manager of the COMESA/Regional Trade Facilitation Project (Chirundu One-Stop Border Post) presented a paper on Integrated Border Management Systems: A Way Forward in Trade Facilitation. As with other border posts, Chirundu, on the Zambia-Zimbabwe border, has various government agencies carrying out various statutory functions including customs, immigration, health and safety, product standards, security and intelligence. These agencies work in an uncoordinated manner, leading to delays, duplication of effort, ineffective enforcement, increased trade transaction costs and inefficient trade flows. Any harmonization initiative is fraught with various challenges, including different systems, legislation, loss of power, inter-agency rivalry, and developing standard operating procedures.
Speaking at the forum, Mr. Creck Buyonge of CCES – Africa said the border was always a contested area where different interests such as sovereignty, security, and trade facilitation converge, so the issue of border agency cooperation within the WTO Trade Facilitation deliberations is more complex as it goes beyond trade issues in the strict sense. In terms of approach, some countries had adopted a policy of integration of border agencies (such as Canada and USA), while others preferred coordination (most of Europe). The issue of border agency cooperation was made more complex by the fact that while customs agencies were generally aware of the deliberations on the subject at the WTO, the other agencies were not involved in the debate to a comparable level of detail. Changing the mode of operation of the various agencies, while not an impossible task, was challenging because there were legislative, even constitutional barriers to remove before it can be done.
Some of the participants at the meeting Progress in the WTO trade negotiations agenda depends to a large extent on the extent to which developing countries can be assured that they will not sign into commitments without the provision of adequate technical assistance and capacity building to support implementation. For the foregoing reason, the Beijing meeting discussed in detail the related problems of Special and Differential Treatment (SDT) and Technical Assistance and Capacity Building (TACB). How would a Trade Facilitation Agreement incorporate these principles to ensure that it achieves a win-win situation for all countries regardless of their level of development?
Principles on SDT/TACB
The WTO’s Doha Ministerial Conference of 2001 positioned Technical Assistance and Capacity Building as “core elements of the development dimension of the multilateral trading system.” Instead of taking a “one suit fits all” approach, the WTO now admits that different countries have different “implementation-related issues and concerns”. However, capacity to participate in the ongoing trade negotiations is a concern for least developed and developing countries. According to Dr. Mohammad Saeed (Pakistan), those negotiators that have been participating in the Boksburg Group have shown greater mastery of the issues and have contributed to drafting some of the current textual proposals on trade facilitation.
SDT and TACB is one of the most important negotiating issues for least developed and developing countries in the WTO’s Doha round. The Boksburg Group held discussions on the two issues, and agreed on “Guiding Principles for technical assistance, capacity building and special and differential treatment in the implementation of a WTO trade facilitation agreement”. The Guiding Principles provide a framework for addressing these issues in a Trade Facilitation agreement in a manner that allows developing countries to progressively implement a comprehensive package of trade facilitation measures, within a flexible framework of rules, at a pace that they can accommodate. The Guiding Principles are as follows: 1. All WTO Members should commit to implementing the same set of measures on the basis of an approach tailored to individual countries’ circumstances. 2. WTO Members should be prepared at least to bind existing levels of trade facilitation. 3. WTO Members should stipulate a time period within which they would be bound to implement specific commitments / measures. 4. Commitments may from the outset be linked to technical assistance (TA) and funds for capacity building (CB) where this is necessary to enable effective implementation. Commitments should not be enforceable if adequate TACB is not provided. 5. Commitments should be contained in individual Member implementation plans, drawn up on the basis of a Member’s needs assessment and working with donors as appropriate. 6. Donor countries (including developing countries in a position to do so) and organisations should prepare and publish an overall donor plan to ensure that all WTO Members’ needs are covered and that there is no duplication. 7. Capacity acquisition should be determined by the Member requesting TACB in partnership with its donor or donors. 8. An early warning system should be established within the WTO to allow advance notice of any implementation delay. 9. A WTO Committee on Trade Facilitation should be established to provide a forum for guidance on implementation and monitoring implementation. 10. Dispute settlement should be a last resort.
The detailed Guiding Principles will be circulated to members of the WTO Negotiating Group on Trade Facilitation for their consideration in preparation of textual, and eventually legal, proposals on a Trade Facilitation Agreement. Unlike other WTO Agreements like the Agreement on Valuation or the Agreement on Trade-Related aspects of Intellectual Property rights (TRIPS) whose scope is very clear, Trade Facilitation is a cross-cutting issue that can take a “soft” as well as a “hard” perspective. Soft issues include review of business processes and border agency cooperation, while hard issues relate to the expensive infrastructure required to support trade facilitation (e.g. building ports, roads, bridges, ICT infrastructure, etc). It is generally agreed that implementation of a WTO Trade Facilitation agreement would include provision of TACB support for soft issues, and not infrastructure. Whether it would include ICT equipment is less clear, because while some like computers may be provided as part of TACB on cost considerations, others like container scanners are generally expensive. It is hoped that the Boksburg Guiding Principles will generate discussion among negotiators and donors on the role of TACB in a Trade Facilitation agreement. Private Sector
The Beijing meeting was also an opportunity for the Boksburg Group to take stock of its work over the years, and to chart out a path for the future. Participants were unanimous that its unique mix of participants and working style made it possible for members to break out of their national cocoons and look at Trade Facilitation afresh with an objectivity that is not possible while in negotiating mode. It had been observed that many developed countries had strong private sector lobbies that influenced the positions of the countries at the WTO. On the other hand, the private sector role among least developed and developing countries was more reduced, as governments tended to negotiate without making adequate consultations with the private sector. However, the situation is now changing.
Dr. Mohammad Saeed (Pakistan) chaired the meeting, which brought together trade negotiators and other government officials from Barbados, China, Colombia, Costa Rica, Guatemala, Nigeria, Sri Lanka, Pakistan and Uganda. Members from the consulting, private and non-governmental organization sector also attended including Axxionar Ingenieria de Negocios (Argentina), the Bolivian Association on the Political Economy of Globalization, the Centre for Customs and Excise Studies Africa regional office (Kenya), China Ocean Shipping Group Company, Ciltax Consultants (Zambia), Cosco Logistics (China), Ernst & Young (South Africa), Gainde 2000 (Senegal), the National Confederation of Industries (Brazil), Phillips Consulting (South Africa) and the Southern Africa Global Competitiveness Hub (Botswana).
9th Boksburg Group Meeting
The meeting was held under the auspices of the Ministry of Commerce of the People’s Republic of China, organized by SITPRO and the Commonwealth Business Council, and supported by the UK Department of International Development (DFID) and the Swedish Ministry of Foreign Affairs.
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