TFA implementation problem a ‘real shame’: World Bank chief

October 11, 2014 07:35 pm | Updated May 23, 2016 04:29 pm IST - Washington

World Bank President Jim Yong Kim has described the world’s inability to get across the finish line with the Trade Facilitation Agreement as “really, really a shame,” adding that the market would “punish those who are putting their heads in the sand”.

Speaking on the margins of the Annual Fall Meetings of the Bank and the International Monetary Fund alongside Roberto Azevedo, Director-General of the World Trade Organisation, Mr. Kim said that global trade could have a poverty-reducing impact but “all of this works better if we have this TFA. The more complicated the customs rules, the more complicated the relationships are between countries, the more it favours bigger companies.”

The entire panel discussion appeared to represent a pitch for the TFA, which has additional significance for India, one of the few nations that declined to meet the July 31 deadline for adopting the Bali Agreement citing concerns relating to the lack of progress on food security issues at the WTO.

“Trade Facilitation was one of the important elements of the outcome from the Bali Ministerial and we remain fully committed to supporting implementation of the Bali deal as we see the development benefits of reducing costs to trade,” Mr. Kim however said.

Adding his voice to the strong message of support for the TFA, Mr. Azevedo said, “I have to acknowledge that we are having difficulties in the implementation of the TFA but I am sure that this is not the end of the road. We are going to do it and just have to figure out how.”

Commenting on the convergence of approach across the WTO and the Bank in terms of the campaign to get the TFA deal done, he said, “We’re announcing today that [the WTO and the World Bank] are working together to complement our efforts in providing this kind of technical assistance to countries that need it. The point is to make sure that no country that is a member of the WTO is left behind.”

While Mr. Kim praised the Chinese e-commerce company Ali Baba for creating value chains that surpassed the Chinese mail system by investing in multiple transportation companies to get products from local farmers into the cities, he said that without the TFA in place poor people across countries who wanted to trade with each other were prevented from doing so.

“It’s really, really, a shame that we’re having some difficulty getting across the finish line for the TFA,” he said, adding, “The more complicated the customs rules, the more complicated the relationships are between countries, the more it favours bigger companies.”

Small and medium enterprises across nations would lose out in this scenario, he cautioned.

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