National Farmers' Federation

WTO agreement to reduce supply chain costs for ag exports

Red tape will be reduced and custom and border processes streamlined for agricultural exports with the signing of the World Trade Organisation’s (WTO) Trade Facilitation Agreement (TFA) in Geneva last week.
National Farmers’ Federation Chief Executive Tony Mahar welcomed the move.
“Three quarters of Australia’s agricultural production is export-bound so any move to enhance free and efficient global trade is a positive for our sector,” Mr Mahar said.
The agreement came into force when the threshold 110 nations needed to sign onto the deal was reached.
Specifically the TFA provides a framework for the expedited movement, release and clearance of goods moving across international borders. It also sets out measures for effective cooperation between customs and other authorities on trade facilitation and customs compliance issues.
“The deal comes at a time when the case for liberalised trade needs to continue to be made and the dangers of protectionism reinforced,” Mr Mahar said.
He said Australian farmers operated in a fiercely competitive global market with slim margins and higher operating costs then many of their competitors.
“Australian farmers are increasingly becoming integrated into global food supply chains. Non-tariff barriers to trade add to costs – costs which compound all along those supply chains. Therefore addressing those barriers and clawing back costs at every point in the supply chain needs to be rigorously pursued.”
Economic analysis has estimated that full implementation of the TFA would cut trade costs in WTO member countries by an average of 14.3 per cent through simplifying, modernising and harmonising export and import processes.
A WTO study estimates a boost of $1.3 trillion to global exports as a result of the TFA – with developing countries standing to gain the most.
“The TFA is another tool to assist Australian agricultural exports to continue to increase in value,” Mr Mahar said.
“Preferential trade deals with China, Korea and Japan are also paying dividends for our farmers. The TFA will help Australian exporters make better use of these agreements and will enhance the value of any new trade agreements”
Mr Mahar said the TFA had been a long time coming to fruition and he recognised the efforts of former Trade Ministers Craig Emerson and Andrew Robb as well as current Trade Minister Steven Ciobo in getting it to this point.

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