Philippine products and services are bound to reach an even wider international market once the World Trade Organization’s (WTO) Trade Facilitation Agreement (TFA) is ratified.
“The TFAenables streamlined, transparent, and efficient customs procedures which would result to a more conducive trading environment for business, and reduce prices for consumers and producers,” said DTI Secretary Adrian S. Cristobal Jr.
“The procedures and provisions in the TFA establishes a more efficient and streamlined mechanism for traders which in turn contribute to improving the overall experience of doing business in the Philippines.,” Cristobal explained.
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 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.To ratify the WTO TFA, the Philippines will submit its Instrument of Acceptance signed by President Benigno Aquino III to the WTO through itsPhilippine Mission in Geneva.
The TFA is also consistent with customs reform initiatives in other international fora such as the World Customs Organization (WCO), Asia Pacific Economic Cooperation’s (APEC) Trade Facilitation Action Plans and activities of its Sub-Committee on Customs Procedures, and ASEAN trade facilitation initiatives.Philippine reforms are currently underway through theCustoms Modernization and Tariff Act (CMTA) now pending ratification in Congress.
The CMTA adopts trade facilitation measures that will expedite import and export clearance. This legislation will improve customs services through a simplified, secured, and harmonized cargo clearance process. The CMTA addresses, as well, the country’s international trade commitments and deals with transparency and accountability issues in the Bureau of Customs (BoC).
Through the CMTA, the BoC’s importation and exportation procedures would be faster, more convenient, more efficient – not just for the large businesses – but also for the micro, small and medium enterprises (MSMEs) in the Philippines.
DTI Undersecretary for Industry Development Dr. Ceferino S. Rodolfo said that the TFA will significantly benefit MSMEs since the implementation of rational, efficient, and simple rules would encouragethem toparticipate more actively in international trade.
“Our MSMEs can now easily export goods and finished products as well as import intermediate goods which will serve as industry inputs for processing and re-export, fully integrating our industries into the Global Value Chain (GVC). This will result into a spill over effect to other industries, thus generating jobs, disseminating upgraded technology, and advancing the skills and capability of our local entrepreneurs,” Rodolfo said.
The Philippines serves a crucial processing link along the GVC chain, both as a source and destination for intermediate goods, with a 56% overall participation rate measured by share of foreign value added in total exports. The country was ranked 8th in the list of the top 25 developing economy exporters in the 2013 World Investment Report of the United Nations Conference on Trade and Development.