FACILITATING INTRA-OIC TRADE:
Improving the Efficiency of the Customs Procedures in the OIC Member States
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in manufactured goods in 2000-2001 in global trade. The study considered port
efficiency and customs environment as “border” elements and regulatory environment
and service sector infrastructure as the “inside the border” elements of trade facilitation.
The authors estimated the total gain in trade flow in manufactured goods from trade
facilitation improvements as $377 billion. They also found that all the elements have
positive effect on trade flows and noted that port efficiency, regulatory environment and
service sector infrastructure have a more significant positive effect on the exporters than
for importers. Customs environment has a significantly positive effect on trade of the
importing country. They concluded that a country’s trade will change not only through
its own trade facilitation reforms, but also the reforms of its trading partners.
Recently Moise and Sorescu (2013) assessed the impact of trade facilitation measures
(sixteen trade facilitation indicators (TFI) on trade volumes and trade costs of 107
countries (96 WTO Members and 11 WTO Observers). The results showed that
improvement in all TFIs reduce the cost of trade by 14.5 percent for low income
countries, 15.5 percent for middle income countries and 13.2 percent for upper middle
income countries.
Table 1 below illustrates the benefits of trade facilitation for both the governments and
the traders.
Table 1: Benefits of Trade Facilitation
For the Governments For the Traders
1. Increased effectiveness of control
methods
Cutting costs
2. More effective and efficient
deployment of resources
Reducing delays
3. Correct revenue yields Faster customs clearance and release through
predictable official intervention
4. Improved trader compliance Simple commercial framework for doing both
domestic and international trade
5. Accelerated economic
development
Enhanced competitiveness
6. Encouragement of foreign
investment
Source: UNECE “Trade Facilitation: An Introduction to the Basic Concepts and Benefits”
1.3. IMPLEMENTING TRADE FACILITATION MEASURES
Increasing competition among the countries put pressure on them to take extra steps to
increase their trade. In addition to promoting production in different sectors for
diversifying the exports, they also started to think on various measures to make trade
easier. Since the tariffs are no longer so high, trade facilitation became an important
area in this regard. However, before deciding to implement such measures, the