The multilateral agreement promises to streamline, simplify and standardise customs procedures and was finally approved after ratification from four additional countries.
Needing two-thirds of its members on board before any agreement can come into force, the WTO’s proposal were implemented when Rwanda, Oman, Chad and Jordan added to the previous endorsements of 108 other nations.
And according to the body that represents freight forwarders across the globe, The International Federation of Freight Forwarders Association (FIATA), the agreement could turn the tide and remind governments that trade and logistics are crucial to economic growth.
Steve Morris, chairmen of FIATA’s Customs Affairs Institute said: “The World Trade Organisation trade facilitation agreement is hailed by the freight forwarding industry as a great achievement for the international trading community.
“As the coin turns to implementation, FIATA and its members in 160 countries stand ready to play its part and collaborate with all governments, as appropriate.”
Though the trade agreement is not a direct reaction to the resurgence of protectionism, in which countries shield their own domestic industries from foreign competition by placing increased taxes on imports, it will help to boost multi-lateral trade by highlighting the importance of free trade to international economies.
Furthermore, while the agreement does not essentially mean free trade due to the various taxes, duties and other quotas that are in place internationally, forwarders should expect to pay less as administration, procedures and formalities are simplified.
Robert Keen, director general of the British International Freight Association (BIFA), commented: “This agreement aims to simplify and clarify international import and export procedures, customs formalities and transit requirements.
“It should make trade-related administration easier and less costly, thus helping to provide an important and much needed boost to global economic growth.
“Of course, of late, some nations have made it clear that they intend to scale down multi country free trade deals and switch to bilateral relationships, marking a return to the bad old days of protectionism.
“BIFA believes that the world has benefited immeasurably from liberalised trade. Not only has consumer choice been enriched in many countries, but also out-sourcing of production has brought valuable employment to developing economies throughout the world.”