Mr. Cheick Sidi Diarra
United Nations Under-Secretary-General
and High Representative for the Least Developed Countries,
Landlocked Developing Countries and Small Island Developing States
Thematic Meeting on International Trade
and Trade Facilitation
as part of the
Mid-term Review of the Implementation of the Almaty Programme of Action
30 August 2007
His Excellency Mr. Prime Minister of Mongolia,
Ladies and Gentlemen,
Let me at the outset express my heartfelt thanks to the Government and People of Mongolia for being such a gracious and exceptional host to the thematic meeting on trade and trade facilitation which is being convened as part of the midterm review of the Almaty Programme of Action. I am particularly pleased to come to this beautiful country with an ancient history as my first international trip in my capacity as the High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States. The agenda of landlocked developing countries will be high in my priority. Let me also take this opportunity to thank the representatives from landlocked and transit developing countries and donor countries for accepting our invitation to participate in this meeting. My thanks also go to the representatives of UN system organizations and other international organizations for their active involvement in this important meeting.
Although the difficulties of being landlocked permeate every aspect of the development process and poverty alleviation, their impact on the external trade is particularly severe. The additional transit transport costs, which landlocked countries must bear, constraint export development since this burden limits the range of potential exports and access to potential markets. The price of imports tends to soar. High transport costs remain the single most important obstacle to their equitable access to global markets and competition with other countries. Despite the gains that the international trading system has brought, the landlocked developing countries remain marginalized. 9 of the 31 landlocked developing countries are not members of the WTO. Landlocked developing countries’ share of world trade remains miniscule, though increased due to the recent surge in commodity prices, accounting for only 0.76 per cent of the total exports and 0.74 per cent of the total imports of world merchandise in 2006.
The central objective of the Almaty Programme of Action is to address the specific problems confronted by landlocked developing countries in their external trade. Tremendous efforts have been made, and tangible progress has been achieved since the Almaty Programme of Action was adopted exactly 4 years ago today. Even more needs to be done to further accelerate the implementation of the Almaty Programme of Action.
In and of itself, the decision by the General Assembly to convene the midterm review of the implementation of the Almaty Programme of Action in 2008 reflects the commitment of the international community to the full and effective implementation of the programme. The review is an important exercise to assess what has been achieved so far, what could have been done better, and how the second half of the implementation period could be effectively utilized to advance on the ultimate goals to assist landlocked developing countries in their effective participation in the international trading system. The United Nations system organizations actively embarked on the preparatory process. To kick start the process in more structured and coordinated manner the UN-OHRLLS charted out conceptual and organizational framework for the midterm review.
High transit transport costs and undue long delays are both a symptom and a result of negative factors which fall under two major categories, namely physical infrastructure bottlenecks and non-physical barriers. Bearing this in mind, two thematic meetings are being organized to address these issues. We had the first thematic meeting on transit transport infrastructure development in June this year in Burkina Faso. The outcome document made an assessment of the current situation of transit transport infrastructure development in landlocked and transit developing countries and identified areas strengthening global partnerships for transit transport infrastructure development. Today in Ulaanbaatar we gathered here to address the issues related to the trade and trade facilitation. The outcomes of the two thematic meetings will serve as substantive inputs to the midterm review.
As we all know, the exhaustive procedural requirements, documentation and contracts have a negative impact on external trade performance in landlocked and transit developing countries. It is even severely felt on landlocked developing countries as their goods travel through additional border crossings. According to the World Bank estimate, pre-arrival documents, customs and inspections accounted for 75 per cent of total delays. Each additional day in transport delays costs 0.5 per cent of cargo value for goods transported by ship or rail. Exporting and importing take 52 and 65 days for landlocked developing countries as a group against 30 and 39 days spent by transit developing countries. These statistics illustrate the magnitude of the impact of cumbersome procedures on the external trade performance in particular and economic development in general of landlocked developing countries.
Therefore, landlocked and transit developing countries must aggressively pursue to implement bold trade facilitation measures. Trade facilitation measures do not require enormous capital unlike infrastructure development. But strong political commitment for bold reform and liberalization is a must. Let me share my thoughts on what needs to be done in the area of international trade and trade facilitation.
· Greater market access for agricultural and non-agricultural goods originating in landlocked developing countries is vital for landlocked developing countries. Trade transaction costs of landlocked developing countries are exorbitant compared to other countries. To mitigate these heavy burdens, the international community should act urgently to ensure better market access for goods from landlocked developing countries, establish necessary mechanisms and to provide much-needed technical assistance to boost exports from these countries. Even duty free market access should be considered as an option. To this end, the landlocked developing countries should strengthen their negotiating capability at the WTO trade talks. In this regard, the Asuncion Platform provides solid basis for their concerted efforts.
· At the national level, landlocked and transit developing countries can implement a number of policy measures to ease the export/import procedures. The excessive requirements of licensing should be reduced or eliminated. Also, the requirement for signatures should also be decreased in order to reduce the costs of traders.
· At the bilateral or subregional levels, various trade facilitation measures should be undertaken to ensure the speedy movement of goods in transit. Number of checkpoints and customs convoys should be drastically reduced. The rules and regulations of customs and border crossing should be made transparent; Customs and border crossing documents have to be unified and simplified with a view to introduce a single customs document; Office hours have to be harmonized; third party motor insurance and driver licence should be acceptable at the regional levels; Adjacent border crossing points should be established; Information technology should be broadly used; Consultative mechanisms should be established to address all the bottlenecks in the area of transit trade at the national and regional levels.
· The WTO negotiations on trade facilitation afford an extraordinary opportunity to landlocked and transit developing countries to agree on internationally binding rules on trade facilitation. Article V on Freedom of Transit, Article VIII on Fees and Formalities, and Article X on Publication and Administration of Trade Regulations of the 1994 GATT Agreement cover the most important aspects of traffic in transit. Therefore, landlocked developing countries should vigorously seek to ensure that freedom of access by all means of transport is effectively operationalized; and that national treatment is provided for all facets of traffic in transit. Rules and regulations should be made transparent, simple and easy to understand. And an effective monitoring mechanism should be established.
· Efforts of landlocked and transit and developing countries should be supported by the international community. Donor countries should give greater priority and support to the initiatives aimed at the improvement of trade facilitation measures. Trade facilitation is a complex issue. It is especially difficult for landlocked developing countries by virtue of their dependence on transit policies and facilities provided by their transit neighbours. Therefore, the WTO and other relevant organizations should extend all the necessary technical assistance to landlocked developing countries on a priority basis to strengthen their negotiating capacities. There is an urgent need for an increase in demand-driven, country-specific technical assistance programmes for landlocked and transit developing countries.
· Effective monitoring mechanism is important to measure the progress in trade facilitation. In this regard, the methodologies proposed by the UN-OHRLLS and UNESCAP are welcome start. They should be broadly used.
The outcome of this second thematic meeting will surely be a critical contribution for the midterm review to arrive at the meaningful outcome. Our next step for the preparation for the midterm review is the regional reviews. As requested by the General Assembly in its resolution 61/212, the UN Regional Commissions are expected to play major role. In this regard, I am glad to see the active involvement of UNESCAP and UNECA in this meeting. The outcome of the regional review should focus on deliverables that can be implemented at the regional, bilateral and national levels. The United Nations as a whole, and my Office in particular, will continue to support the efforts of the landlocked and transit developing countries toward the full and effective implementation of the Almaty Programme of Action.