How does the entry into force of the WTO’s Trade Facilitation Agreement (TFA) in February 2017 affect African countries’ efforts to join and move up global value chains (GVCs)? The WTO’s Trade Facilitation Agreement (TFA) provides a new global benchmark for customs and border procedures. Its objective is to provide countries with a framework for helping firms move goods more quickly, reliably, and cost-effectively across borders. Trade facilitation is particularly important in the context of global value chains (GVCs), as this business model requires producers to move intermediate inputs from one country to another multiple times during production. World Bank research shows that trade flows in intermediate goods of the type traded within GVCs are more sensitive to improvements in trade facilitation than flows of final goods. So the stakes are high for Africa: joining GVCs, which are still in the early stages of development across the continent, provides a new incentive for governments to move forward on trade facilitation. The TFA: Benchmark or goal? To date, 19 African countries have ratified the TFA. This relatively low figure is surprising given the innovative structure of the TFA. For developing countries, including those in Africa, only those provisions notified by each...
Written by Ben Shepherd