UNNExT Workshops on Trade Facilitation UNNExT Workshop on Trade Facilitation and Paperless Systems for Agrifood Products Almaty, Kazakhstan 4-6 May 2015 1
Status of Trade Facilitation Measures Habibullah Asad Trade Expert May, 2015 Almaty , Kazakhstan
Contents 1. Introduction 2. Foreign Trade trends 3. Economic Development so far 4. Trade Facilitation compliance 5. Conclusion
Heavy Reliance on International Trade Afghanistan has pursued a liberal trade policy and reformed its trade policy regime in line with the WTO requirements with low tariff (Average 7%) and non-tariff barriers. Afghanistan’s exports lack diversity, with carpets and dry fruits accounting for close to three-fourths of total exports. Other exports include fresh fruits and cotton and highly dependent on imports. In fact, the Afghanistan trade balance is generally in deficit and relying on foreign aid heavily. The pattern of the Afghanistan trade is often called ‘processing trade’, because it produces goods by processing imported raw materials. Therefore, the government put a great emphasis on expansion of exports by supporting local producers and infant industries for import substitution and export promotion.
GDP breakdown by economic sectors 22% Services 48% Agriculutre 30% Industry Source: Afghanistan Statistical Yearbook
Shares of main export commodities 20% Dry fruits 27% Carpets 2% Medical herbs 3% Fresh fruits Oil seeds 7% Wool Karkul skins 18% 7% Other 16% Source: Afghanistan Statistical Yearbook
Shares of main import commodities Vehicles and spare parts Petroleum and lubricants 24% Metals 31% Wheat and wheat flour Vegetable oil Fabric Sugar Cigarattes Tyres and tubes 1% Tea 1% 1% 21% Cloths 1% Soaps 1% Other 5% 2% 9% 1% 2% Source: Afghanistan Statistical Yearbook
Selected features of economic development so far Afghanistan has come a long way to achieve remarkable progress in its business enabling environment. This progress is clearly manifested in our ranking improvement from 170 to 164 (out of 185 economies) in the WB Ease of Doing Business. FDI inflows are projected to reach USD 76 million in 2012 where total FDI stocks were USD 1.625 billion, representing 9.4% of GDP. Services have contributed about half of GDP in 2012, mostly sourced from Information & Communication Technology, Finance & Insurance, Transport, and Construction.
The Afghan economy is dominated by agriculture with significant opportunities in agri-business and agriculture distribution and infrastructure. The mining sector is slowly emerging as a source of growth. Need for further investment to finance further mineral exploration - more than 1400 mineral deposits have been identified so far (some are strategically important).
Provision of the Agreement Current Status of conformity Fully, Substantially, Partial, No, not applicable ARTICLE 1 PUBLICATION AND AVAILABILITY OF INFORMATION 1. Publication Partially 2. Information available through internet Partially 3. Enquiry Points No 4. Notification Not being a member of the WTO, Afghanistan has no notification obligations to the WTO. Note however that Afghanistan has provided textual description of its trade policy regime and legal framework to members of the Working party on accession
The legal framework for Enquiry Points for SPS measures and TBT regulations is currently drafted. In practice, MAIL dispatches notes on disease information, namely those receive from Codex Alimentarius, OIE (World Organisation for Animal Health) and IPPC (International Plant Protection Convention)to Customs as circular letter to other agencies, including ACD, and informs traders thereof. All perishable goods require clearance by MAIL inspectors at the entry points.
In Practice Trade Facilitation Measures • ACBR streamlined business procedures to 8 steps • ACD improve processes & streamlined its clearance processes • ACD introduced Risk Management in cargo selectivity • ACD implemented SAD nation-wide • At several border crossings, facilities have been upgraded
ASYCUDA is operational in the Afghan Customs Department (ACD) nationwide as below: ASYCUDA++ Transit System is operational on 7 (seven) main transit corridors: - Torkham (border with Pakistan) - Jalalabad - Kabul - Weesh/Spin Boldak (border with Pakistan) - Kandahar - Islam Qala (border with Iran) - Herat - Kabul - Hairatan (border with Uzbekistan) - Mazar e Sharif - Kabul - Towroghondi (border with Turkmenistan) - Herat - Kabul - Andkhoy (border with Turkmenistan) - Kabul - Sher Khan Bandar (border with Tajikistan) - Kunduz - Kabul
ASYCUDAWorld (AW) International Transit is fully operational on the transit corridors: Torkham (Pakistan) – Hairatan (Uzbekistan) Torkham (Pakistan) – Sher Khan Bandar (Tajikistan)
ASYCUDA++ DPS (Declaration Processing System) is operational in 9 (nine) Customs Houses/Offices: Jalalabad, Herat, Kunduz, Mazar e Sharif, Zaranj/Nimroz, Kandahar, Andkhoy, Torkham and Islam Qala.
ASYCUDA World (AW) DPS is operational in 2 (two) main Customs Houses: Kabul, Kabul International Airport. In all computerised Customs sites: - 100% of the declarations are processed through the ACD ASYCUDA, thus replacing the 5 (five) copies of the ACCD form (Afghan Customs Clearance Declaration) and other extra Customs forms previously used; - A new declaration processing-flow was implemented: reducing the previous Customs processing path from 14 (fourteen) steps and signatures to only 3 (three); - The entire Customs clearance process is fully automated and electronically available both for Customs officers and for Customs brokers/traders (100% DTI, Data Trader Input);
EDI • MoU signed with Pakistan, Tajikistan and Uzbekistan; • Implemented EDI pilot project in Torkham, Wesh and Shirkhan bandar • Exchanging electronic information with Iran • ACB planning to introduce EPAY electronic payment system for speed up import/export declarations.
Afghanistan’s Control , Inspection and Approval Procedures will Ensure • No undue delays • Information requirements: limited to what is necessary • No less favourable treatment for imports: – Fees – no discrimination, only to cover costs • Procedure to review complaints 18
Transparency establish an Enquiry Point Afghanistan will AND designate a Notification Authority notify other Members of new or changed SPS regulations when no international standard exists regulation may OR AND have significant the new regulation is different effect on trade than the international standard 19
Information Flows Related to SPS Enquiries and Notifications Ministry of Agriculture, Irrigation and Livestock WTO Incoming SPS Notifications Comm SPS-ENP Veterinary Service Enquiries & SPS Responses Counter- Comments & part Outgoing Notifications Interested SPS Plant Parties Counter- Quarantine part SPS Service Counter- part Sanitary Ministry of Service Public Health 20
TBT Enquiry Point & Notification Authority • Afghanistan joining WTO • Requires complying with TBT Agreement • TBT Article 2: Requires notification • TBT Article 10: Requires establishing Notification Authority • WTO Members expect Afghanistan to have these to be operational.
Information Flows Related to TBT Enquiries and Notifications Ministry of WTO Incoming Agriculture, TBT Notifications Irrigation and Comm Livestock TBT-ENP Veterinary Enquiries & Service TBT Responses Counter- Comments & MoCI part Outgoing TBT Notifications Counter- Interested TBT part Plant Parties Counter- TBT Quarantine part Counter- National TBT Service part TBT Counter- Environmental Counter- part Protection part Sanitary Ministry of Agency Service Public Health
Regionalization • Afghanistan shall adapt SPS measures to characteristics of an area (all or part of a country, all or parts of several countries) taking into account • prevalence of diseases or pests • existence of eradication or control programmes • criteria/guidelines developed by OIE, IPPC • Afghanistan shall recognize concept of pest- or disease-free areas 23
Conclusion Afghanistan has pursued a liberal trade policy and intends to reform its trade regime in line with the global trading rules as it becomes a WTO member. In the context of regional integration and implementation of bilateral and transit agreements, Afghanistan will promote harmonization with international conventions, agreements and standards. To improve business environment with a view to remove the constraints holding back the growth of a private sector. The major focus is on improving the existing regulations (as required) to comply with internationally acceptable business standards and to develop new ones.
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