EXPORT EXPANSION THROUGH TRADE FACILITATION Bucharest Jon Walden - - PowerPoint PPT Presentation

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EXPORT EXPANSION THROUGH TRADE FACILITATION

Bucharest Jon Walden

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Agenda

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• 1. Why is trade facilitation important
• 2. What are the challenges
• 3. Current initiatives in global trade facilitation
• 4. How these initiatives open up new markets for Romania
• 5. Questions / Discussion

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Some headlines……

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In 2016 Romania exported $63.4B, making it the 34th largest exporter in the world. During the last five years the exports of Romania have increased at an annualized rate of 4.92%, from $61.8B in 2011 to $63.4B in 2016. The most recent exports are led by Vehicle Parts which represent 10.5% of the total exports of Romania

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The top ten exports

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1.Electrical machinery, equipment: US$12.3 billion (17.4% of total exports) 2.Vehicles: $11.5 billion (16.2%) 3.Machinery including computers: $7.8 billion (11%) 4.Mineral fuels including oil: $2.9 billion (4%) 5.Furniture, bedding, lighting, signs, prefab buildings: $2.7 billion (3.8%) 6.Rubber, rubber articles: $2.4 billion (3.5%) 7.Optical, technical, medical apparatus: $2.4 billion (3.4%) 8.Cereals: $2.3 billion (3.2%) 9.Clothing, accessories (not knit or crochet): $2.2 billion (3.1%) 10.Articles of iron or steel: $2 billion (2.8%)

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The current international trade environment involves complex international trade processes with disparate systems

Each international trade transaction requires an average of 40 documents of 200 data elements, with 15% repeated at least 30 times and 60-70% repeated more than once. (UNCTAD)

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International Trade Supply Chain

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International Trade International trade in the 21st Century – the reality – Non-tariff Barriers

• Increasing complexity of processes
• Increasing commercial risk to traders
• Increasing country risk to traders
• Increasing banking risk to traders
• Increasing supply chain security issues
• Increasing trackability / traceability requirements
• Decreasing availability of expertise

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Ease of Doing Business

• Romania is ranked 45 among 190 economies in the ease
• f doing business, according to the latest World Bank

annual ratings. The rank of Romania deteriorated to 45 in 2017 from 36 in 2016. Ease Of Doing Business in Romania averaged 38.25 from 2014 until 2017, reaching an all time high of 45 in 2017 and a record low of 35 in 2015.

• Romania falls behind Moldova in Doing Business 2018

ranking

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Market Access Database

• http://madb.europa.eu/madb/indexPubli.htm

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Market Access Database

Applied Tariffs Database

http://mkaccdb.eu.int

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Market Access Database

Exporters’ Guide to Import Formalities

http://mkaccdb.eu.int

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TRADING GROUPS SUPPORT GLOBAL VALUE CHAINS

• Customs Union
• European Community – 28 members – ‘Free Circulation’
• East Africa Community
• Free Trade Areas (FTAs)
• European Economic Area – EEA
• North American Free Trade Area – NAFTA
• European Free Trade Area – EFTA
• Asian Free Trade Area – AFTA

– Brunei; Indonesia; Singapore; Malaysia; Philippines; Thailand; Vietnam

• Asian Pacific Economic Cooperation Forum – APEC
• Preferential Trade Agreements (PTA’s)

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Current Initiatives and Trends in Trade Facilitation

• World Trade Organisation Trade Facilitation Agreement –

Ratified 5 October 2015 Notification 5 March 2018

• Migration to e-Commerce
• Transport – multi-modal connectivity
• Blockchains ??
• Availability of information

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Why the TFA is important for Romania

• EU Level
• Romania level
• Opening up emerging markets
• Global networks and globally networked customs

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The TFA in context

• 1. The Trade Facilitation Agreement is the first

Agreement concluded at the World Trade Organisation (WTO) by all of its Members

• 2. It is a big deal in the context of the evolution of

international trade law as it obliges WTO member countries to adopt, either as mandatory or as best efforts, recognised international best practice into national law concerning the control and regulation of trade across borders

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Merchandise exports

• f WTO members

totalled US$ 16.2 trillion in 2015

International Trade in Context

Source: WTO World Trade Statistical Review 2016 The share of developing economies in merchandise exports increased from 33% in 2005 to 42% in 2015 Merchandise trade between developing economies has increased from 41% to 52% of their global trade in the last ten years

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Where the TFA will Impact

Source: OECD

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Objectives

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What does it all mean for Romania ?

• Reduction in overhead cost of international business
• Opening up of emerging markets
• Increased export diversity
• Promotion of ‘Brand Romania’
• Attract inward investment
• Further expansion in global value chains

All of which supports economic growth and increased prosperity!

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Summary and Questions

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Thank You