Honduras ratifies WTO trade facilitation agreement
Honduras has ratified the WTO's TFA
Honduras has ratified the World Trade Organization's (WTO) Trade Facilitation Agreement (TFA), becoming the fifth Central American nation to accept the new accord.
Concluded at the WTO's 2013 Bali Ministerial Conference, the TFA contains provisions for expediting the movement, release and clearance of goods, including goods in transit. It also sets out measures for effective cooperation between customs and other appropriate authorities on trade facilitation and customs compliance issues. It further contains provisions for technical assistance and capacity building in this area.
The ratification took place on 14 July between Honduran vice-minister Melvin Redondo and WTO director-general Roberto Azevêdo. However, the TFA will only enter into force once two-thirds or 108 of the WTO's 161 member countries formally accepted the agreement. Honduras's acceptance brings the total number to 86, representing more than three-quarters of the number needed.
According to the WTO's flagship World Trade Report published in October last year, implementation of the TFA has the potential to increase global merchandise exports by up to US$1trn per annum. The report also found that developing countries will benefit significantly from the TFA, capturing more than half of the available gains.
Indeed, the TFA broke new ground for developing countries and LDCs in the way it will be implemented. For the first time in WTO history, the requirement to implement the Agreement was directly linked to the capacity of the country to do so. In addition, the Agreement states that assistance and support should be provided to help them achieve that capacity.
Other Central and South American countries to have signed the agreement include Panama, Guyana, Brazil, Paraguay and El Salvador.
At present, Guatemala, El Salvador and Honduras are the main exporters of garments from Central America. More than 90% of these exports go to the US market. According to a recently published report by just-style, these three Central American garment industries must continue investing in growth and ensure factories are safe and ethical if they are to compete effectively against Vietnam for access to the US market.
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