The Trade Facilitation Agreement that has now come into force could support the creation of 20 million jobs worldwide, including many in Australia, by cutting red tape at borders, the Australian Chamber of Commerce and Industry said today.
The TFA, an initiative of the World Trade Organization, has been ratified by two-thirds of WTO members so will now formally commence, making it the first multilateral trade agreement to enter into force in over two decades.
James Pearson, CEO of the Australia Chamber, said: “In recent years the growth in trade has slowed around the world, but the Trade Facilitation Agreement is a watershed moment that will create jobs through helping businesses, many of them small, to trade.
“The Australian business community welcomes the TFA coming into force. The TFA is a landmark global trade agreement that could boost global trade flows by over US$1trillion and create 20 million jobs, according to the International Chamber of Commerce. The countries that will benefit most are developing economies, meaning the TFA will be a vital step towards making global growth more inclusive.
“The TFA re-establishes the pre-eminence of the World Trade Organization in global trade architecture. Complex customs requirements in many countries mean that many small businesses struggle to trade internationally. Cutting unnecessary red-tape at borders means the TFA will transform the ability of entrepreneurs to access global markets.
“Australia has work to do. The World Bank has ranked Australia 91st in its Global Ease of Doing Business analysis. We should strive to reach the top 10. The TFA means we will get even greater benefits from steps we take to improve our international competitiveness.”
The Australian Chamber is the National Committee of the International Chamber of Commerce in Australia.
John Danilovich, Secretary General of the ICC, said: “ICC has tirelessly championed the TFA because we know that making trade easier through simple customs reforms can provide a major boost to small business growth. It’s estimated that the TFA could increase SME exports by 80 per cent in some economies. This means more jobs, more consumer choice and-ultimately-more inclusive development.
“The entry into force of the TFA is just one step to making the potential benefits of this landmark agreement a reality. Governments must work without delay to implement the provisions of the TFA working hand-in-hand with local businesses to identify key bottlenecks to trade across national borders.”