Trade facilitation encompasses governmental and regulatory practices that expedite the movement of goods across borders through initiatives promoting efficient, transparent customs procedures and controls.
Key Components of Trade Facilitation:
- Streamlined border compliance processes such as single submission points for documentation
- Advanced rulings provide legally binding classification or valuation in advance to reduce unclearances
- Automated customs systems and risk-based controls increase process predictability
- Coordination between agencies permits unified border agency “single window” interfaces
Example:
A WTO agreement established global standards on releasing perishable goods within 24-48 hours through pre-arrival processing and post-clearance audits.
Takeaways:
Simplified trade procedures reduce transaction costs that are especially prohibitive for SMEs. However, balance guards against security/compliance while optimizing velocities key to competitiveness in “just-in-time” supply environments dependent on short lead times.
