Regional integration through joint trade facilitation reforms: Boosting regional trade with coordinated and harmonized implementation of the Trade Facilitation Agreement.

• Date: 01 October 2018
• Author: Tuomisto, Victoria

Regional implementation of trade facilitation reforms can bring more significant --benefits to regional economic communities (REC) and their member states rather than uncoordinated measures applied by each country autonomously. Regional approaches can ensure that traders in the same region are not burdened by differing customs formalities and cross-border requirements that hinder cross-border trade in the region. Importantly, uniform formalities and procedures conceived and coordinated at the regional level can remove bottlenecks, increase the participation of small and medium-sized enterprises (SMEs) and enhance the competitiveness of regional value chains, thus deepening regional integration.

A healthy business environment and the ease of doing business are critical for thriving regional cross-border trade. A poor cross-border trading environment partly explains why only 14% of total African trade is intraregional compared to approximately 50% for Asia and 70% for Europe. In fact, when shipping goods between two countries in West Africa, it may be cheaper to ship them through Europe than directly. This is partly due to highly cumbersome customs procedures, high transportation costs and poor infrastructure throughout the region, which seriously hamper regional trade and integration.

To overcome these problems, RECs have aimed to coordinate reforms for trade facilitation. A notable example is Association of Southeast Asian Nations (ASEAN) Single Window initiative, which connects and integrates the national single windows of its member states...