Peru and Saudi Arabia ratify WTO trade deal
Peru and the Kingdom of Saudi Arabia have become the latest to ratify the World Trade Organization's (WTO) Trade Facilitation Agreement (TFA) – making a total of four countries this month to have done so and a further sign of support for the landmark global deal.
The ratification by Peru follows that of Mexico and Honduras this month, making it the sixth nation in Central and South America to accept the new accord. Other Central and South American countries that 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.
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 TFA will enter into force once two-thirds of the WTO membership has formally accepted the agreement. With the acceptance by Mexico, the number of ratifications now stands at 89, representing more than three-quarters of the ratifications needed to bring the agreement into force.
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$1 trillion per annum. The report also found that developing countries will benefit significantly from the TFA, capturing more than half of the available gains.
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