Analyzing WTO's Trade Facilitation Agreement: Border Trade Impact

This essay examines the WTO's Trade Facilitation Agreement, resulting from the Ninth Ministerial Conference in Bali, Indonesia, and its impact on global trade, particularly for developing and least developed countries. The agreement, which came into force in 2017, aims to streamline customs procedures, reduce tariffs, and enhance agricultural productivity. It is considered a significant reform in global trade, potentially reducing international trading costs by 14.7%. The analysis highlights the agreement's focus on simplifying cross-border trading, improving customs compliance, and supporting food security in developing nations. Ultimately, the essay concludes that the agreement is poised to boost economies worldwide by fostering faster and more globalized trade, addressing long-standing issues in international trade and promoting universal acceptance among WTO member nations. Desklib offers a range of resources, including past papers and solved assignments, to aid students in understanding such complex topics.

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WTO Agreement on Trade Facilitation: Border Trade Impact and global acceptance
The Ninth Ministerial Conference of the World Trade Organization was held in Bali,
Indonesia between the 3rd and 7th of December in 2013 (Press Information Bureau, 2014).
This conference aimed at streamlining multiple trading procedures between nations and
boosting the agriculture and food security of developing countries who are members of the
WTO. The universal acceptance and introduction of the WTO Bali agreement will contribute
massively to the global trade facilitation of developing and under-developed countries around
the world. It will promote cross-border trade owing to its transparent and streamlined policies
for customs compliance procedures. The reforms are also aiming to make documentation
procedures much more transparent and will boost the agricultural produce of countries that
fall under the poverty line. There are a huge number of advantages that have come out of the
9th international trade facilitation agreement in Bali and most of these are in favour of the
developing nations and the impoverished least developed countries or the LDCs as they are
more commonly known.
One of the main benefits of this conference was seen to be the loosening of the
stronghold on customs duties of traded goods and speeding up the process of cross-border
trading between various nations. This was welcome news for most developing and under-
developed countries which are struggling with cross-border trade due to the high tariffs on
imports and exported goods along with a strict customs compliance protocol at the border
(Jatkar et al, 2014). This agreement finally came into force in 2017 and is being hailed as the
first of its kind by the WTO in recent years. It will be the first multi-lateral agreement by the
WTO that will focus on the standardization and simplification of the procedures involved in
international cross-border trading (Gunnlaugsdóttir, 2017).

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According to the WTO director general Mr. Roberto Azevedo, this agreement is the
“biggest reform of global trade in a generation” as it would bring down the overall cost of
international trading by a whooping 14.7% (Walker, 2017). Amongst the long list of reforms
that have come into force as of 2017, the ones that are being praised the most are the
reduction of tariffs, easier and faster customs procedure and agricultural benefits for
developing nations. The trade facilitation agreement also states that the WTO will henceforth
help the developing and least developed nations to achieve their full potential in international
commerce and food productivity by facilitating all possible trade negotiations and
documentation procedures required. This has come as a fresh breathe of air for the many
struggling countries around the world which have been facing plenty of issues regarding food
security and international trade agreements. Since the agreement consists of two separate
sections, one that has 13 articles and a special S&D section that will serve to uplift trade and
food security of developing and least developed nations (Viljoen, 2013).
The impact of the Bali Trade facilitation agreement on the global border management
will also be huge as the agreement has streamlined and accelerated the cross border trading
procedures between bordering nations with their special list of reforms (Hoekman, 2014).
These reforms are aimed at creating more substantial trade in developing nations all across
the globe and bring about greater agricultural produce as well as increase food security in the
least developed nations. One of the biggest draws that have come out of this agreement has
been the reduction of import and export duties. Import and export of traded goods have been
one of the major causes of concern for companies because of the excessively high tariffs that
were set earlier by the WTO. Another problem that has plagued the global border trading
association has been the rigorous customs documentation and checking procedures that
caused delays which resulted in major losses more often than not. These problems were the

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centre of attention during the Bali conference as the WTO pulled out many harmful plugs
from the international trading pipeline to ease the flow of cross border trade and help the
economies of many developing countries across the world. The basic tariff rates on imported
and exported goods have also come down quite a bit according to the special reforms as have
the custom duties that were previously applicable on most imported leisure goods. Border
trade issues have been plaguing both government and non-governmental organizations for
many years now. This agreement hopes to bridge the gaps that were previously found to be
the root cause behind many business delays and losses. This will ensure that the cross border
trading process is expedited and a new day dawns on the international trade of under
developed nations (Bellmann, 2014).
It may be concluded that the 9th Ministerial conference of the world trade organization
at Bali was a huge success and now that it has come to force, global trading can expect to see
a major boom in the coming years. Most WTO member nations have welcomed the reforms
with open arms as they have nothing to lose from the policies that have been declared in the
reforms. The countries that are most likely to be gainers from this agreement are the
developing nations like India. Other nations that fall under the category of LDCs or the least
developed countries are also the biggest gainers of this treaty. Some of the least developed
countries that have been under the scanner of the reforms are nations like Yemen,
Afghanistan, Angola, Bhutan, Bangladesh, Somalia, Sudan etc. Many more under developed
and impoverished nations are going to receive maximum benefits from this agreement and all
the reforms that have come into force along with it. All in all, the global border trading scene
will witness major changes for the better and this will boost the economies of many countries
worldwide. Not only will it help the economy of the world as a whole, this agreement will
ensure that there is a faster and more globalised trade that happens between nations (Dhar et
al, 2013). The reforms are bound to be welcomed and accepted universally by nations

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everywhere as they have focused on some of the most long-standing issues that have been the
worry of the international traders for quite some time. It remains to be seen as to how much
the global GDP increases as a result of the trading reforms that have been introduced by the
Bali agreement. The actual results of this reform should be visible within a few years from
now as the trading duties and export import tariffs have been reduced quite drastically in this
agreement.

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REFERENCES
Bellmann C.(2014), « The Bali Agreement: Implications for Development and the
WTO », International Development Policy 5(2). Retrieved from:
http://journals.openedition.org/poldev/1744 ; DOI : 10.4000/poldev.1744
Dhar B., and Kishore R. (2013), “Prospects of the Bali Ministerial”, United Nations
ESCAP, Retrieved from: http://www.ris.org.in/images/RIS_images/pdf/wp13613.pdf
Gunnlaugsdóttir S.(2017), THE WTO TRADE FACILITATION AGREEMENT, ANTI
CORRUPTION AND CUSTOMS: A NEW TYPE OF ANTI CORRUPTION
INSTRUMENT, Lagadeild School of Law, Retrieved from:
https://skemman.is/bitstream/1946/29739/1/Sigfr%C3%AD%C3%B0ur
%20Gunnlaugsd%C3%B3ttir_ml_ritgerd.pdf
Hoekman B. (2014), “The Bali Trade Facilitation Agreement and Rulemaking in the
WTO: Milestone, Mistake or Mirage?”, Global Governance Programme-132, RSCAS
Retrieved from:
http://cadmus.eui.eu/bitstream/handle/1814/33031/RSCAS_2014_102.pdf
Jatkar A., and Mukumba C.(2014), “Unpacking the Bali Package A Snapshot of the Bali
Ministerial Decisions of the WTO Members”, International Trade, Economics &
Environment (CUTS CITEE), Retrieved from:
http://www.cuts-citee.org/pdf/Unpacking_the_Bali_Package-
A_Snapshot_of_the_Bali_Ministerial_Decisions_of_the_WTO_Members.pdf

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Press Information Bureau, Impact of Trade Facilitation Agreement in 9th Ministerial
Conference at Bali , 12-February-2014, Retrieved from:
http://pib.nic.in/newsite/PrintRelease.aspx?relid=103590
Viljoen W. (2013),”A summary of the Bali package”, TRALAC.ORG, Retrieved from:
https://www.tralac.org/discussions/article/5348-a-summary-of-the-bali-package.html
Walker A. (2017), “WTO's new global trade deal comes into force”, BBC News, Retrieved
from: http://www.bbc.com/news/business-39049074