PRESENTATION ON COMESA TRADE FACILITATION 1 ST AFRICAN UNION TRADE FACILITATION FORUM: BRAZZAVILLE, CONGO COMESA Secretariat _17 - August _2015

CONTENTS: –BACKGROUND –TRADE FACILITATION PROGRAMME –UPDATES ON IMPLEMENTATION OF TRADE FACILITATION –WAY FORWARD

BACKGROUND  The COMESA Treaty (Articles: 3 & 4) recognise the importance of common trade facilitation, modernization and reform of customs operations, application of modern customs techniques;  On Trade Facilitation, in line with the WTO/WCO principles, the program aims at a balance between the easy trade against the need to ensure compliance with the regions trade rules and to safeguard collection of the revenues required to run national and regional programs.  14/19 of the COMESA MS are WTO Members (Burundi, DR Congo, Egypt, Kenya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Swaziland, Uganda, Zambia, and Zimbabwe) and 4/19 of the MS (Comoros, Ethiopia, Libya,, and Sudan) are WTO observers.

STATUS OF IMPLEMENTATION A regional Workshop on: “Implementation of the WTO Trade Facilitation Agreement in COMESA Member States (MS) discussed in June 2015 to get common understanding on MS’ obligations under the agreement and to guide MS on the categorization of obligations under the Agreement 17 MS (Burundi, DR Congo, Comoros, Egypt, Eritrea, Ethiopia, Kenya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Sudan, Swaziland, Uganda, Zambia and Zimbabwe) attended the workshop.

UNDERSTANDING THE TFA AND ITS IMPLICATIONS Problem of TF in most MS take close to 30 days to export and approximately 35 days to import and cost of doing business very high compared to…. TF problem emanates from poor technology, border procedures, documentation requirements, fees and other formalities. Perceived gains of implementing the TFA of up to 14.5% trade costs reductions for developing countries. TFA should aim at addressing bottlenecks to trade, increase efficiency and reduce business costs.

SPECIAL AND DIFFERENTIAL TREATMENT, AND NOTIFICATION REQUIREMENTS  TFA provided clarifications and improvements on GATT Articles V, VIII and X. ;  MS categorise their obligations into categories A, B and C.  Category A obligations will be implemented immediately after the entry into force of the TFA for that MS,  Category B obligations will need additional time,  Category C will require both additional time and provision of technical assistance for the identified capacity needs to be implemented.

SPECIAL AND DIFFERENTIAL TREATMENT, AND NOTIFICATION REQUIREMENTS …  the TFA has both mandatory and best endeavour obligations, and also contains flexibility regarding implementation of Category B and C obligations.  LDC will have an additional year to notify their obligations.  the period of notification is also determined by the Member Countries themselves.  the need to be aware of implementation challenges that are likely to be encountered once the Agreement is ratified.  Acceding for some MS are currently not under obligation to notify their obligations.

ROLE OF THE NATIONAL TF COMMITTEE  National structures in implementing the TFA play critical role,  MSs are legally obligated to form national committees on trade facilitation under Article 23 of the TFA;  Role of the committees ranging from coordination, foster TF and guide negotiations;  Success and sustainability of national committees largely depend on political will, private sector participation, coordination, capacity building and sustainable funding.  Importance of coordination with other agencies to avoid duplication of efforts.

IMPLEMENTING TFA TO PROMOTE AND DEEPEN REGIONAL INTEGRATIONS The need to integrate TF in regional integration in a holistic manner. Regional integration efforts should include business logic and integrate private sector in regional trade facilitation programs. Private sector can have a role to play in transit related measures, joint border controls, and policy related cooperation. Different approaches to implementing trade facilitation; regional harmonization, regional coordination and regional implementation levels in implementing the TFA.

IMPLEMENTING TFA TO PROMOTE AND DEEPEN REGIONAL INTEGRATIONS IMPLEMENTING TFA TO PROMOTE AND DEEPEN REGIONAL INTEGRATIONS … Article 21 of the TFA which alluded to a regional approach to trade facilitation “Members shall endeavor to include activities to address regional and sub-regional challenges and promote regional and sub-regional integration Coordination of border management, harmonization of policy and addressing NTBs will all aid regional integration efforts Maximize benefits of regional efforts in TF: harmonization of policies, ensuring economies of scale, community level participation in rule making and synchronizing reforms across business supply chains.

SHARING EXPERIENCES ON TFA IMPLEMENTATION Mauritius, Trade Facilitation Committee (TFC) set up in the context of negotiations of the WTO TFA, conducted needs assessment exercises with assistance of the WTO in A second needs assessment exercise was initiated after the conclusion of the TFA –Implementation plan on the basis of a broad based consultation with all stakeholders and notification on category A measures was submitted on the basis of the categories identified in the plan. Malawi, the national committee has been formed which will deal with more than just the trade facilitation issues

SHARING EXPERIENCES ON TFA IMPLEMENTATION... Kenya, a national trade facilitation committee which is chaired by the KRA was formed; –Categorization of obligations was done in April 2015, and notification to the WTO was done on acceptance of the TFA, as well as Category A obligations; –Notification to the WTO was done on acceptance of the TFA, as well as Category A obligations; work on categorization of category B obligations is on-going.

SHARING EXPERIENCES ON TFA IMPLEMENTATION … Egypt, TFA committee started on 2002 and the committee has been reformulated in the year The Egyptian customs authority with the guidance of the committee, made customs reforms which helped in harmonizing the local regulations with the TFA. In 2013 the national committee was concentrating on following up the implementation of the TFA with regard to categories A, B and C obligations. Applying category A and set the time required for category B commitments and determining the areas where technical assessment under category C is needed.

SHARING EXPERIENCES ON TFA IMPLEMENTATION Seychelles, a needs assessment was done in 2014 with support from WTO. Consultations with stakeholders are still on-going and the country will notify Category A obligations to WTO as soon as the process is complete. National structures will also be completed soon. Zimbabwe, the process of categorization of the provisions of the WTO TF Agreement is on-going. Stakeholders workshop involving ZIMRA, several Government Departments and private sector business associations were conducted; A draft working document with proposals on categorization of the provisions of the WTO Agreement has been developed and inputs from the consultative forum were included.

SHARING EXPERIENCES ON TFA IMPLEMENTATION … Swaziland, held a needs assessment workshop before the Bali conference, where categories of obligation were identified. A committee was formed chaired by the International Trade Department and SRA, and a steering committee which reports directly to Cabinet. Preparation for the process of ratification and notification of the TFA is on-going and will be completed with approval from cabinet. Noted that the MS are doing a lot in preparing to notify and ratify the TFA and there will be need to identify capacity building needs especially for Category C obligations.

CHALLENGES COMESA is a pioneer in different trade facilitation initiatives. However, the implementation level is not as high as expected, due to capacity limitation or funding constraints from the MS there will be need to identify capacity building needs especially for Category C obligations. implementation challenges that are likely to be encountered once the Agreement is ratified. Acceding MS like currently are not under obligation to notify their obligations, but will however be required to do so as soon as the accession process is complete.

WAY FORWARD Recognising that implementation of the TFA would bring benefits for the MS; they are encouraged to expeditiously complete the national ratification process and deposit the instrument of ratification to the WTO; There is added benefit in bringing all the relevant stakeholders including from the private sectors together in the design and implementation of the TF reforms. This could be achieved by establishing National Trade Facilitation Committees;

WAY FORWARD … A coordinated approach at a regional level can contribute towards deepening regional integration and achieve economies of scale and this could be achieved by discussing such issues at the regional level Development partners are coordinating their technical assistance activities and MS would benefit if they coordinate their technical assistance needs especially for category C provisions for seeking assistance from development partners; Trade Facilitation Sub Committee under the Trade and Customs committee be established.

THANK YOU FOR YOUR ATTENTION !!! ZEREZGHI KIDANE SENIOR CUSTOMS AFFAIRS OFFICER