RESTRICTED  WORLD TRADE  
ORGANIZATION  TN/TF/M/2 
2 February 2005 
 (05-0417) 
Negotiating Group on Trade Facilitation  
  
 
 
MINUTES OF THE MEETING  
 
Held in the Centre William Rappard
 
on 22-23 November 2004  
 
Chairman:  Mr. Muhamad Noor Yacob (Malaysia) 
 
 
 
1. The Chairman  noted that the proposed agenda for th e present session had been circulated in 
WTO/AIR/2441 and REV.1.  The purpose of the meeti ng was two-fold.  First, to engage in an 
educational and stock-taking process, involving briefi ngs by the Secretariat on relevant issues, as well 
as by UNCTAD, the World Customs Organization and the World Bank on the work they were carrying out on Trade Facilitation and the programmes a nd facilities they were able to offer to support 
developing countries and LDCs through capacity build ing in that area.  Secondly, delegations would 
be invited to make contributions  on the agenda of the Negotiating Group as agreed at the Groups’ first 
session.   
2. Furthermore, Members would be invited to admit relevant intern ational organizations, 
including the IMF, OECD, UNCTAD, WCO and the Wo rld Bank, to attend the next meeting of the 
Negotiating Group on an ad hoc  basis.  
3. Under "Other Business", the representative of Chile
 noted that her delegation wished to offer 
some information on the APEC Ministerial Declaration on Trade Facilitation.   
4. The agenda was adopted .   
A. EDUCATIONAL AND STOCKTAKING PROCESS  
5. The Chairman  recalled Members’ agreement to devote at least part of the meeting to an 
educational and stocktaking process.  That had b een requested by many delegations, and would be 
useful to enhance Members’ understanding of the issues at stake. 
6. The representative of the WTO Secretariat  noted that she would like to dedicate the first part 
of her presentation to a brief analysis of the co re regulatory framework under consideration in the 
negotiations – Articles V, VIII and X of the GATT.   These had been the ma in reference point for 
Members’ engagement on Trade Facilitati on in the WTO since the beginning.   
7. She would look at the main obligations prescrib ed in the Articles and at guidance given by 
GATT and WTO panels on their interpretation.  A second part of her presentation would describe 
technical assistance activities carried out by the Secretariat in the area of Trade Facilitation, touching 
upon the products, principles and programmes of that work.  TN/TF/M/2 
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 8. Article V of the GATT aimed to secure free tr ansit of goods across the territories of each 
Member by setting out a number of specific oblig ations.  The Article cove red goods but not persons, 
despite earlier attempts in the negotiating history of  the provision to include them as well.  On the 
other hand, efforts were successful to broaden the Ar ticle’s coverage to have it extend to other means 
of transport despite initial calls in the preparator y process to opt for a more narrow scope.  The only 
exception to that principle related to the operation of  aircraft in transit, which the drafters of the 
Article wanted to leave for the International Civil Air Organization to deal with.  The other limitation 
to the requirement to allow for free transit was th at it only had to be granted "through the routes most 
convenient for international transit".   
9. Members were required not to discriminate on the basis of several criteria such as flag of the 
vessel, place of origin, departure, entry, exit or destin ation, ownership of the goods etc.  The text set 
out the key requirement that transit traffic was not to be subject to any unnecessary delays or restrictions.  Customs duties, transit duties or othe r charges in relation to transit were not to be 
imposed, except for (i) charges fo r transportation or (ii) those commensurate with administrative 
expenses entailed by transit or (iii) with the cost of  services rendered.  Those charges were required to 
be reasonable, having regard to the conditions of the traffic.  The Article further contained a MFN 
requirement with respect to all charges, regulations and formalities of transit traffic.  An interpretative 
note to Article V:5 specified that, as regards tran sportation charges, the obligation referred to like 
products being transported on the sam e route under like conditions.   
10. As regards relevant jurisprudence, there was no case involving Article V after almost sixty 
years since the Article’s entry into force.  That wa s not to say that there had never been any arguments 
amongst the membership on the Article.  There had even  been some cases involving the initial stages 
of dispute settlement proceedings, but they had all been settled by means other than panel rulings.   
11. GATT Article VIII aimed to limit the fees and formalities a Member could legitimately 
impose on or in connection with importation or expo rtation by requiring them to be (i) limited in 
amount to the approximate cost of services rendered, (ii) not to represent an indirect protection to 
domestic products or (iii) a taxation of imports or  exports for fiscal purposes.  It was important, 
however, to keep in mind that the Article only ex tended to a residual category of fees and charges, 
namely all that were neither import or export duti es nor charges within the purview of Article III of 
the GATT.  Members were required not to impose any substantial penalties for minor breaches of 
customs regulations or procedural requirements.  In  particular, it was prohibited to levy any penalty 
for an omission or mistake in customs documentati on that was easily rectifiable and made without 
fraudulent intent or gross negligence beyond that necessary to serve as a warning.  A recommendation 
adopted by Members in 1952 suggested that no char ge other than that for the replacement of a 
document should be imposed for mistakes made in good faith, and that corrections of the original 
documents should be allowed within reasonable lim its.  Furthermore, the Article offered an 
opportunity for any Member to request another Me mber to review the operation of its laws and 
regulations in the light of Article VIII.   
12. The second part of the Article contained some sort of hortatory statements. Members 
"recognized" the need for (i) reducing the number a nd diversity of fees and charges covered by the 
provision, and (ii) minimizing the incidence and co mplexity of import and export formalities and for 
decreasing and simplifying import and export documentation requirements.  
13. Further guidance on the interpretation of th e Article was available from GATT and WTO 
jurisprudence, involving a number of rulings on various aspects of the provision.  Prominent examples 
of key findings in that context included rulings  on the types of fees and charges covered by 
Article VIII, on the meaning and coverage of the re quirement to limit charges to the approximate cost 
of services rendered, on the elements for the calculation of such services, on the conformity of  TN/TF/M/2 
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 ad valorem  fees, and on the requirements for the determ ination of whether a fee constituted taxation 
for fiscal purposes. Details of those findings could be found in G/C/W/391.   
14. GATT Article X aimed to ensure a certain le vel of transparency with respect to the 
publication and administration of trade regulations.  To that end, the provision set out a number of 
specific requirements, starting with the obligation to  promptly publish all re levant laws, regulations, 
decisions and administrative rulings of general ob ligation in such a manner as to enable governments 
and traders to become acquainted with them.  An ea rlier drafting proposal to extend that obligation to 
the notification of those laws and regulations to  the Secretariat was not taken up, but in 1964, 
Members decided to issue a recommendation to that end.  Protection of confidential information was 
provided by ensuring that there was no requirement  to disclose any data that would impede law 
enforcement, be contrary to public interest or prejudice legitimate commercial interests.  A second 
key requirement of the Article was to prohibit th e enforcement of a measure within the provision's 
coverage prior to its official publication.  
15. Article X 3:a called for the uniform, impartial and reasonable administration of trade 
regulations.  Paragraph 3:b required Members to maintain or institute  tribunals or procedures for the 
prompt review and correction of administrative act ion relating to customs matters.  However, the 
requirement was to do so "as soon as practicable",  leaving room for a Member not to have such 
mechanisms while still being in conformity with the Article under certain conditions.  Article X 3:b 
set out certain guarantees with respect to the i ndependence of those tribunals from enforcement 
agencies.  Guidance on the interpre tation of several aspects of those obligations was available in 
GATT and WTO panel rulings. Clarifi cations were given on matters such  as the scope of the Article 
and the precise meaning of terms like "general application", "published promptly" or "uniform, 
impartial and reasonable".  Further information on those rulings could be found in G/C/W/374. 
16. Turning to the technical assistance work carried  out by the Secretariat in the area of Trade 
Facilitation, she noted that it covered several diffe rent products.  Activities in cluded regional seminars 
and workshops, which would be held in every regi on of the world in 2005, complemented by national 
seminars and workshops.  Trade facilitation sessions  and lectures could also be found in the 
framework of both Geneva-based and regional Trade Policy Courses, as well as in several specialized courses such as the Advanced Training Programmes for Senior Government Officials, Geneva Weeks, 
Introduction Courses, or activities carried out in th e framework of the Joint Integrated Technical 
Assistance Programme (JITAP) and the Integrated Fr amework (IF).  Technical assistance work would 
also take the form of joint activities executed with  other organizations or groupings, the next one 
being the APEC-WTO Roundtable on Trade F acilitation scheduled for February 2005.   
17. With respect to the Trade Facilitation-related technical assistance activities for 2005, there 
would be regional seminars/workshops  in all parts of the WTO universe so that each developing and 
least developed country would have an opportunity to  benefit from those events.  They were planned 
to last 3 to 4 days, targeting participants from both the customs and the trade policy sector, with each 
country being allowed to send officers with such backgrounds.  The reason for inviting representatives 
from those two areas was that it had been found useful to have some kind of exchange and 
coordination between the two institutio ns which were main partners in that process and needed to be 
aware of their respective work as well as of the Ge neva events.  There would also be a number of 
national seminars/workshops , depending on the requests received.  Judging from the input received so 
far, it seemed that Africa could be a focus of tho se events, with a number of requests already having 
been submitted. As for Trade Policy Courses, there woul d be four in Geneva and five in other parts of 
the world, the first one being planned to take place in Jamaica followed by one in Hong Kong, two in 
Africa and one in Latin America.  Activities in the context of specialized courses and programmes 
involved a range of activities spanning from Traini ng Programmes for Senior Government Officials 
over Geneva Weeks for non-resident Members to special courses for LDCs and others.  Examples of 
co-sponsored activities were the upc oming Roundtable with APEC, as well as a number of events TN/TF/M/2 
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 with several UN or Bretton Woods institutions and with certain regional bodies.  Additional 
engagements were planned in the framework of  JITAP and the Integrated Framework.   
18. All of those activities were Member-driven, in that they responded to the extent possible to 
the requests from Members to the Secretariat.  That was sometimes a challenging task as there was 
also a need for the Secretariat to balance its wo rk with available resources.  Therefore, it was 
necessary to identify certain priorities.   
19. A principle of the Secretariat’s technical assist ance work was to carry out its activities in a 
coordinated and cooperative way, both internally and externally .  Cooperation and coordination with 
external partners was important on two levels:  firs t, in planning and executing joint activities and in 
developing common instruments like the database operated with the OECD, and second, in entering 
into a dialogue with other assistance providers w ithin the framework of various groupings.  One such 
forum was the Inter-Agency Meetings on Trade Fac ilitation, a body bringing together all the main 
international players in the Trade Facilitation ar ena like the UN organizations, the World Bank, 
OECD, IMF, WCO and many others, sometimes invol ving the participation of donor governments.  
Meetings were held on a regular basis, mostly in  Geneva, to discuss technical assistance and other 
work, to explore possibilities for joint activities and to ensure that  there were neither gaps nor 
overlaps.  Another key forum was the Global Fac ilitation Partnership for Tr ansportation and Trade, 
where the World Bank was particularly involved.  That forum had a similar objective and a prominent 
product – a joint website – allowing everybody to ge t an overview of technical and other relevant 
Trade Facilitation work carried out by each of the public and private sector partners and offering a 
wide range or related background materials.  Ot her examples of coordina tion and cooperation fora 
included the International Trade Procedures Work ing Group, involving several public and private 
sector players, as well as ad hoc  meetings amongst representatives of key organizations at the margins 
of Trade Facilitation events and activities.   
20. The representative of Pakistan
 said that, with respect to technical assistance, his impression 
was that there were many things happening but some  of the activities were more of a generic nature, 
with not all of them being devot ed exclusively to Trade Facilitati on.  Sessions on Trade Facilitation 
had been about GATT Articles V, VIII and X, with out extending to other areas such as how countries 
should improve Trade Facilitation.  There might be a need for a different policy here.   
21. The representative of the Secretariat  explained that the focus of individual activities varied in 
the sense that there were events (such as nationa l and regional seminars a nd workshops) which were 
exclusively devoted to Trade Facilitation, while othe rs were broader and covered other WTO topics as 
well.  On a general level, technical assistance work  by the Secretariat focussed on the implementation 
of Agreements and briefings on th e relevant legal framework.  The WTO was quite different from 
other organizations such as the World Bank or the UN in that respect, which had a different structure, 
different mandate and different budget.  She agreed  with Pakistan that technical assistance should not 
– and had never meant to be – limited to those activities carried out by the Secretariat, but the 
mentioned activities were what the Secretaria t could do with its limited resources.   
22. The representative of the Philippines  asked whether there had been  an attempt in the context 
of national and regional workshops to ask developing countries about their particular needs with 
respect to Trade Facilitation, especially regard ing Articles V, VIII and X of the GATT.  The 
identification of such needs was one of the key components of the Trade Facilitation mandate.  With 
all the workshops that had taken place over the past  years, she would have hoped that there was a 
compilation of very concrete needs expressed by developing countries with respect to the three 
Articles currently being reviewed.   
23. The representative of the Secretariat  replied that participants had been asked to provide 
information on their country's specific situation re garding Trade Facilitation ahead of the seminar.   TN/TF/M/2 
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 They had been invited to submit country reports in  preparation for the event, seeking information on 
the current status quo in terms of what kind of Trade Facilitation measures had already been carried out in the framework of national, bilateral or regional programmes, what  had been the specific 
problems encountered in that regard, what were s een as the main barriers to  their trade and what 
would be the priorities for Trade Facilitation meas ures to be implemented.  Feedback had been 
received through those reports to a varying degr ee. For some seminars, 70 to 80 per cent of the 
participants had submitted such reports, while for othe rs, the rate had been much lower.  Those reports 
were then used as a basis fo r several working group sessions and practical exercises where 
participants gave further thought to the particular Trade Facilitation situation in their countries and 
prepared themselves for a third step of those events: a mock committee meeting, simulating the 
Geneva process with participants assuming the role s of representatives of their country, developing 
proposals, and presenting them orally in the framework  of the simulation exercise.  It was in that 
context that participants also touched upon their respective Trade Facilitation needs in a more narrow 
sense, by orally presenting ideas as to what could be  done to overcome the remaining trade barriers 
arising from a lack of Trade Facilitation in their co untries, and indicating what they would need in 
terms of assistance to that end.   
24. The representative of the Philippines
 noted that that was very encouraging, and asked whether 
the information could be made available to the Ne gotiating Group as a starting point for its work in 
that area.   
25. The representative of the Secretariat  replied that participants had sometimes indicated that 
they did not want their informal inputs turned  into formal documents.  There were some 
confidentiality issues involved, since the participan ts came from customs or the trade policy sector 
without necessarily representing their governments, w ith several stressing the fact that they were only 
speaking in their personal capacity.  This was also  why there had been objections to the idea of 
making those reports available on the Internet. Furt hermore, much of the more specific information 
had been presented orally.   
26. The representative of Tanzania  asked how the Secretariat was going to fund programmes 
identified by developing countries and LDCs relate d to capacity building and assistance in technical 
facilitation matters such as the formulation of legisl ation, support for the creation of a national human 
resource base for Trade Facilitation, and technical and financial support for government institutions 
dealing with Trade Facilitation.  Would whether technical support take the form of seminars and 
workshops and would activities in the context of JITAP and the Integrated Framework include the 
creation of institutional linkages between the rele vant international organizations, including IMF, 
OECD, UNCTAD, WCO and the World Bank, for the provision of technical assistance and support for capacity building on Trade Facilitation for deve loping countries and LDCs as an additional and 
complementary means of support?    
27. The representative of the United States
 remarked that it was eviden t that the Secretariat was 
not a development agency.  One of the challenge s Members faced in that area was how to bring 
greater focus in the area of technical assistance.  While there was a wide array of ongoing work with 
many potential resource providers, it was necessary for Members to consider how to increase coordination within the specific context of the ne gotiations and the particular results that might 
emerge.  It could be useful to have in writing so me of the descriptions the Secretariat had given under 
the heading of cooperation and c oordination.  Members would have to consider how the necessary 
technical assistance could work in a way that was co mplementary to existing coordination structures.   
28. The representative of India
 noted that Article X required the publication not only of laws and 
regulations, but also of administrative decisions of  general application and of judicial decisions.  
Although the Secretariat had listed the panel cases involving that Article, she wondered whether the 
Secretariat had done a study on whether such administrative and judicial decisions were actually TN/TF/M/2 
Page 6  
 
 being published by WTO Members in the light of those panel cases and on the problems that had 
emerged in that context.  She did not recall ha ving seen such information in the background paper 
prepared by the Secretariat on Article X.   
29. With respect to the technical assi stance work carried out by the S ecretariat, she agreed that it 
should be limited to the theoretical aspects of Artic les V, VIII and X and related jurisprudence.  
Considering the fact that the modalities for nego tiations on Trade Facilitation placed emphasis on the 
identification of needs and priorities of Members, she wondered whether it would be useful to gather 
information on those aspects with regard to the three Articles in the context of the technical assistance 
activities carried out by the Secretariat.  That coul d help Members in their efforts to identify those 
provisions of Articles V, VIII and X that requi red further clarification and improvement.   
30. The representative of the Secretariat
 replied that the Secretariat did not have that kind of 
information.  While a proposal had been made in the Council for Trade in Goods to amend Article X 
by introducing a requirement for Members to notify da ta to the Secretariat, no modifications to the 
provision had been made.  Under the Article’s current form, there was no such notification 
requirement.   
31. With respect to the possibility of gaining information on Trade Facilitation needs and 
priorities in the context of the Secretariat’s t echnical assistance activities, she noted that the 
Secretariat had tried to gather input on that matter to  the extent that that was possible in the course of 
a three-day seminar.  There had b een some results, although they we re quite different from what one 
would get from government representatives.  In tho se seminars and workshops, the input had mostly 
come from customs officers, reflecting their personal sense of the problems arising from their day-to-
day operations (which might differ from their govern ment’s position).  That was the reason why some 
participants had wished to see their input regarded as personal views rather than official positions of 
their capital, and why many had felt more comforta ble expressing themselves orally than in written 
form.  The Secretariat had tried to raise awarene ss of the importance of that process.  It also 
encouraged participants to communicate their experience to their capitals so that they could feed into 
their governments’ preparations for the Geneva pro cess, in line with the objective to facilitate their 
work in that area.   
32. The representative of India  asked whether there was some kind of database available on the 
practical problems encountered by customs officials in their daily operations.  While it might not necessarily be a government’s position, it could nevert heless assist in gathering information and in 
raising awareness of problems existing at the ground  level that required atte ntion.  The originating 
source might not have to be named.  That coul d prove to be very important for the negotiating 
process, especially since delegates in Geneva were far removed from field level experience.  Some 
information might reach them through feedback fr om their governments, but other things might 
simply be missed.  A database on that information by the Secretariat, the WCO or UNCTAD might therefore prove to be useful.   
33. The representative of the Secretariat
 informed that there was no such database available.   
34. The representative of China noted that Annex D contained several other negotiating elements.  
Priority should be placed on balancing all those elements to advance the whole negotiations on an 
equitable basis.  Due consideration should be give n to point five of the Negotiating Group's  agenda - 
technical assistance and support for capacity buildi ng.  Members' needs and priorities should be 
identified rapidly. And it would be useful if the Secretariat provided a compilation of the existing 
differences in the negotiations and the way Members proposed to deal with them.   
35. The representative of Costa Rica  commented on the points made by India and the Philippines 
regarding the identification of needs and prioritie s in the context of the Secretariat’s technical  TN/TF/M/2 
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 assistance programmes, noting that he would like to sh are his delegation’s experience in that context.  
Costa Rica had hosted a regional seminar for La tin American and Caribbean countries in August 
2003, where a report had been prepared on its situati on in that area.  In Costa Rica’s view, what was 
important initially was to have internal coordi nation amongst all institutions involved, where the 
problems would identify themselves and where posi tive steps and measures could be taken for the 
facilitation of trade.  What Costa Rica had done was to take a snapshot of its situation, which had 
helped it to prepare for the negotiations.  The seminar had also served as an example to other 
countries of the region in terms of what could be done in that area.  As others  had mentioned, it would 
be important to invite participating countries to do that exercise objectively to see where each one 
stood with respect to measures to facilitate trade in orde r to serve as a basis for the future negotiations.    
36. The representative of th e European Communities  noted that it would be useful if the results of 
the various WTO seminars and workshops could be  provided to Members, as far as possible, as 
experience had shown that they offered concrete a nd specific information about the kind of problems 
faced by customs administrations and the trading comm unity on a day-to-day basis.  The EC therefore 
supported delegations asking for info rmation on those activities to be disseminated widely.  He also 
agreed with India that these workshops and semina rs could be a good way to help identify Members’ 
specific needs and priorities.  Generally, when carrying out development aid programmes in the area 
of Trade Facilitation, a comprehensive assessment of  needs was done.  That was a fairly thorough 
way of assessing a country’s particular development needs in that area. Even the more short and 
sporadic workshops of the kind organized by the WTO Secretariat could be useful in identifying 
countries' specific needs and priorities.    
37. With respect to the issue of coordination a nd cooperation between vari ous organizations, he 
wondered whether the Secretariat or the World Ba nk could provide more specific information on the 
Global Facilitation Partnership, and more particularly on the experience of having the private sector 
involved.  That was of particular interest, as th e private sector was directly interested in Trade 
Facilitation and had an important role to play.   
38. The representative of the World Customs Organization  recalled that the WCO was an 
independent intergovernmental body with responsibility for customs issues.  Initially established in 
1952 as the Customs Co-operation Council, the curr ent working name had been assumed in 1994 to 
reflect the organization’s global presence.  The WC O was located in Brussels, Belgium and had two 
official languages:  English and French.  Its missi on was to enhance the effectiveness and efficiency 
of customs administrations and assist them to contri bute to national development goals, particularly in 
the areas of Trade Facilitation, revenue collecti on, community protection and supply chain security, 
thereby contributing to the development of internatio nal trade and to economic and social well-being.   
39. In order to fulfil that mission, the WCO pursu ed three main strategies:  (1) Through its 
conventions, other instruments and best practice approaches the WCO provided an internationally-
agreed series of models for effective customs admi nistration;  (2) The WCO also provided a forum for 
international cooperation and exchange of information a nd experience between Member 
administrations, other international organizations an d the private sector, which was represented at the 
WCO’s meetings;  (3) Through its training and tec hnical assistance programmes it provided a range of 
high quality capacity building opportunities in areas of relevance to Member administrations.  The 
WCO worked closely with other stakeholders, in  particular the business community and other 
international organizations.  The WCO’s 164 Memb er customs administrations were collectively 
responsible for the processing of 98 - 99% of all world trade.   
40. The functions of customs were multi-faceted and had become increasingly more complex.  
Customs not only had a fiscal function, but also one encompassing the economy, the protection of society, and public security.  Revenue collection was still very important in many countries, even in 
countries where import duties were low.  And even  when customs duties were reduced, as it often TN/TF/M/2 
Page 8  
 
 happened when national infrastructure develope d and companies developed better book-keeping 
systems allowing for the introduction of various sales  taxes which diminished the reliance on customs 
duties, additional roles were often given to custom s, such as the protection of economic interests and 
various security roles to protect society from threat s such as drug trafficking and weapons trade, and 
to support the protection of the environment, of cultural goods, intellectual property rights etc.  
Furthermore, they also got involved in economic  development.  If customs procedures were not 
efficient, a country would have difficulty in attr acting foreign direct investment, and in the present 
highly competitive environment of just-in-time-deliv ery of businesses, customs could not afford to 
delay commodities as they crossed borders.  These were  the core functions of customs and all were 
inter-linked and mutually supportive.  While the fo cus placed on one function might differ from time 
to time and from country to country, depending on national priorities, it was necessary and desirable 
for each customs administration in order to preserve all those core functions to properly discharge its 
responsibilities and to remain well-prepared fo r the coming challenges in the new century.  
41. Customs administrations around the world faced  a number of important challenges.  The 
environment in which they operated would continue to be characterized by globalization, continued 
growth and development of international trade, by growing international awareness of the costs 
associated with complying with inefficient and out dated border formalities, by increased use of new 
information and communication technologies and by he ightened awareness of the need for customs 
administrations to strengthen border controls to pr otect society from a range of social and national 
security concerns including international terrorism, transnational organized crime and revenue fraud.  
Strengthened border controls had to  be implemented while at the sa me time continued improvements 
in Trade Facilitation had to be ensured, often with  no additional resources.  Those challenges drove 
customs to become more efficient and effective.  Trade Facilitation in the context of customs meant 
avoiding unnecessary trade restrictiveness while  improving the qualities of controls in an 
internationally harmonized manner.  That was th e basic principle of the WCO's work on Trade 
Facilitation.   
42. The WCO had already been actively contributing to WTO work on Trade Facilitation by 
submitting several papers on the subject to the Council for Trade in Goods in 2002 and 2003.  
(G/C/W/392, 407, 426, 445 and 467). Those pape rs were available on both the WTO and the WCO 
Website.  The WCO had also actively contributed to the WTO agenda by taking part in regional Trade 
Facilitation seminars such as those in Costa Rica, Sri Lanka, Croatia and Lebanon, and was pleased to 
continue that collaboration in the future.  Th e reason for the WCO’s interest in WTO Trade 
Facilitation work was that it had a very positive vi ew on the WTO process, as had already been 
pointed out in the message issued prior to the Ca ncun Ministerial Conference last year.  The WCO 
saw several potential benefits for the customs co mmunity.  The work could produce sustained and 
high-level political will and commitment for custom s reform, provide a framework for more support 
and cooperation with the trading community, enhanc e awareness of customs requirements leading to 
better customs compliance of businesses and improve cooperation with other border agencies, leading 
to integrated border management and a Single Window  approach.  It could also give impetus for 
customs capacity building, and it could provide a fra mework for better coherence in capacity building 
activities.  
43. Bearing such potential benefits in mind, the international customs community had set out 
those thoughts in the before-mentioned message to the WTO Cancun Ministerial Conference in 2003.  
In order to realize and maximize the potential bene fits, the message advocated the following points:  
participation of customs administrations in the WTO process either in capitals or in Geneva, or both; 
enhanced cooperation in the work of the WCO and the WTO; the involvement of other border 
agencies; and search for the full support for customs capacity building.   
44. The WCO conducted approximately 100 nationa l level activities and 20 regional level 
activities every year.  Technical assistance was carri ed out across a broad spectrum, going beyond the  TN/TF/M/2 
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 three GATT Articles V, VIII and X, usually through,  and with, donor assistance.  It covered issues 
such as customs procedures, enforcement tools, the Harmonized System (HS), Customs Valuation, 
Rules of Origin and institution/management (includi ng the issue of integrity).  Those activities were 
closely linked and there was some overlap.  For ex ample, Customs Valuation training often covered 
post-clearance audit, which was one of the customs procedures.  And enforcement training often 
covered risk management, which was a customs procedure as well.  
45. The WCO had conducted a review of previous capacity building activities and learned some 
valuable lessons, which would contribute to successf ul capacity building in the future.  The findings 
could be summarized as follows:  capacity buildin g would not succeed without sustained and high 
political will and commitment;  there was a need fo r greater ownership and participation of senior 
customs personnel, including a change in the mana gement outlook; there was also a need for an 
accurate diagnosis of capacity building needs and fo r country-specific responses, as well as a need for 
realistic government and donor expectations;  exp ectations had to be cha llenging, but realistic.  
Furthermore, there was a need for adequate hum an and financial resour ces, and for enhanced 
cooperation and coherence betw een assistance providers.   
46. Taking account of the lessons learned, the WC O had developed a new strategy for customs 
capacity building.  The strategy was also a res ponse to the Doha Development Agenda that had 
determined technical cooperation and capacity bu ilding as core elements of the development 
dimension of the multilateral trading system.  Th e new strategy advocated the case for a more 
focused, coordinated and well-resourced approach.  Because of the finding that an accurate diagnosis 
was needed for better capacity building, it proposed  to develop and use the diagnostic tool, the so-
called Customs Diagnostic Framework.  It also proposed key delivery processes of capacity building 
activities.  
47. One of the lessons learned from past capacity building activities was that the one-size-fits-all 
approach did not work.  Taking into account that needs and priorities must be diversified across 
countries, the WCO had produced a Customs Capac ity Building Diagnostic Framework.  It was a 
comprehensive and standardized diagnostic tool and project design/implementation guide for both 
self-assessment and use by practitioners to diagnose capacity building needs and priorities.  The tool 
was a substantial matrix containing common qu estions, commonly observed weaknesses, possible 
solutions and improvement options and related reference materials with respect to a wide range of 
customs issues.  Essentially, it was seeking to identify ga ps in an administration’s capacity to develop.  
48. An extract pertinent to the three GATT Ar ticles was being developed for the Geneva 
negotiations.  By using this, customs administrati ons could identify any difficulties, bottlenecks and 
gaps between their legislation and practices and the WCO instruments pertinent to the three GATT Articles.  The findings might be a basis for a country to identify its Trade Facilitation needs and priorities.  What had to be kept in mind, however, was that the tool was designed for customs procedures only, so it did not cover all formaliti es and procedures related to importation, exportation 
and transit as described in the GATT Articles.  Also, the tool was a living document.  It would be 
constantly modified and updated to  take account of the developments  in the WTO negotiations. A first 
version of the tool was expected to be available by February.   
49. The Time Release Study (TRS) was one of the WCO instruments referred to in the Customs 
Diagnostic Framework.  As one of the negotia ting objectives was to expedite the cross-border 
movement of goods, it might be of particular inter est to WTO Members.  The TRS was used to assist 
the government in measuring the average time taken be tween the arrival of the goods (on the means of 
transport) and their release, and at each step.  By using the TRS, countries might identify problems and bottlenecks in the cross-border movement of goods, and develop possible remedies.  The findings 
could be another basis for a country to identify its  Trade Facilitation needs and priorities.  The WCO 
had learned that several WTO Members (such as the United States, Japan, Philippines and Kenya) had TN/TF/M/2 
Page 10  
 
 conducted the TRS and obtained vital information.  The TRS was also used to  stimulate efforts to 
improve the efficiency and effectiveness of customs clearance procedures.  It should be recalled that 
with respect to individual transactions, the variation from the aggregate average could be quite large.  
The time required for the release of goods varied co nsiderably depending on the mode of transport 
(trucks, ships, aircraft), character  of goods (e.g., cereals, cut flowers, cars, crude oil, electronics, etc.), 
and the compliance records of the traders.  The WCO advocated the use of the authorized traders 
approach, where traders with a good compliance re cord would benefit from simplified procedures and 
accelerated clearance.  The TRS was a snapshot in time, and therefore only comparable with a later or earlier similar snapshot.  The WCO was currently  working closely with the Word Bank on the 
development of a software programme, which woul d be made available to all Members.  The 
programme was in its final stages and should be availa ble before Christmas.  It would standardize the 
approach used.   
50. Another WCO Trade Facilitation instrument was the International Convention on the 
Simplification and Harmonization of Customs Pr ocedures (as amended).  The revised Kyoto 
Convention was the blueprint for modern customs administration in the 21
st century.  It reflected best 
practices and ideas of member customs administrations  and views of business, such as, transparency 
and predictability, standardized and simplified documents, minimum requests and intervention, the 
divorce release from clearance, use of risk assessment , specially simplified procedures for authorized 
traders, maximum use of information technology , cooperation with other agencies and foreign 
counterparts, and partnership with the trade.  It would enter into force when 40 of the 63 contracting 
parties to the current convention had signed the prot ocol of amendment.  So far, 37 of them had done 
so.   
51. Turning to the issue of capacity building, he  stressed the importance of talking about the 
delivery process.  One of the problems arising in that context was the lack of suitably qualified people to do the work.  The WCO was therefore working on developing a pool of experts who could carry out the WCO’s Diagnostic Framework and use it to  its maximum benefit.  There were of course 
people available in the Secretariat who could do th at, and they were currently identifying people 
within national administrations who could do that as well.  A seminar had recently been held in 
Bangkok to identify suitable personnel to that end.  An  investment was further being made in training 
resources to have the necessary personnel available.   Training resources were arranged by the WCO 
Secretariat, national customs administrations and other stakeholders, in particular international 
organizations.  A regional approach had been a dopted as one answer to better communication and 
cooperation amongst the regional members.  It would also give more accurate diagnosis, better liaison 
with local donors and other stakeholders.  The WCO had set up several Regional Training Centers in close cooperation with its members.  In addition,  it had set up the Regional Office of Capacity 
Building for the coordination of activities within  the region in Bangkok, which had been open for 
some months now.  E-learning was a response to th e ever-increasing need for training with limited 
resources by the active use of information and communication technology (ICT).  Currently, a 
Customs Control Module and Valuation and Audits  Module were available, and approximately 
1,700 customs officers from 87 countries were register ed in the system.  More modules, such as on 
HS, customs procedures and IPR would follow.   
52. As advocated in the modalities of Trade F acilitation negotiations, collaborative efforts 
amongst international organizations  were important for delivering more efficient and effective 
technical assistance and support for capacity buildin g.  The WCO was increasingly cooperating with 
other international organizations to that end, exp ecting better synergies in capacity building.  One of 
the ways of doing that was through the Global Faci litation Partnership for Transportation and Trade 
(GFP), which provided a cooperative framework of intergovernmental organizations, private sector, 
and any individuals interested in transport and Trade Facilitation.  The WCO was one of its core 
members managing the GFP.  The GFP meetings we re attended by approximately 100 participants 
from both the public and private sector.  The WCO would host the next GFP meeting in Brussels in  TN/TF/M/2 
 Page 11 
 
 
 January 2005.  The WCO contributed to the recen tly published World Bank’s Customs Modernization 
Handbook which described the WCO instruments as a global capacity building tool and which was 
consistent with and complementary to the WC O Diagnostic Framework.  The WCO had also 
contributed to the OECD research on costs of Tr ade Facilitation by providing the necessary contacts 
and assisting with the data collection.  The WCO ha d further participated in several joint technical 
assistance activities with other international organiza tions and the donor community.  For example, it 
had provided its expertise to the WTO seminars on Trade Facilitation and on Customs Valuation, and 
to diagnostic missions within the Integrated Framew ork for Trade-Related Assistance to LDCs.  It had 
also contributed to the Trade Facilitation capacity  building activities in cooperation with the World 
Economic Forum, USAID, APEC and other orga nizations and donors.  The WCO would like to 
continue enhancing its collaborative efforts to provide more effective and efficient support for 
capacity building and coherence.  
53. The international customs community, as the expert on border procedures and as the 
implementing agency of the outcome of the ne gotiations, was ready to engage in the WTO 
negotiations.  The WCO was unsure about the scope of  the WTO negotiations at that stage, but what 
was certain was that the WTO focu ssed mainly - if not exclusively – on customs.  He assured the 
Group of his organization’s conti nued support and cooperation.   
54. The representative of Malaysia  said that, being new to the pr ocess and not too familiar with 
the work of customs, he had been interested by th e authorized traders approach which seemed as if it 
could be very useful for the facilitation of trade.   He wondered whether there were some kind of 
common international standards with respect to that c oncept.  He had also been intrigued by the fact 
that the Revised Kyoto Convention had not yet entered into force and wondered whether it was 
possible to share information on what the partic ular concerns and reservations were that kept 
countries from signing the Convention.   
55. The representative of India  was interested in the diagnostic  tool which was currently being 
developed in the WCO for the assessment of need s and priorities.  She wondered whether it would 
lend itself to self-administration and whether it would be country specific or rather a general 
diagnostic tool applicable to all Members, noting that a one-size-fits-all approach had been found to 
be inadequate.  She had taken note of the tool re lating to GATT Articles V, VIII and X.  As regards 
the Kyoto Convention, India wondered when the Convention was actually finalized.  Only 37 Members had ratified up to now, whereas 40 ratificati ons were required.  Her delegation would like to 
know the relationship of those 40 ratifications with th e fact that there were 164 Members of the WCO.  
India would like to know what that ratio was, how it was arrived at and what had been the reason for 
setting the threshold at 40.  Furthermore, the Indi an delegation would like to hear why it had taken 
WCO Members that long to ratify the Convention a nd what were the problems associated with that 
process.   
56. The representative of Kenya
 remarked that the presentati on by the WCO clearly underscored 
the importance of infrastructure – in human, financ ial and institutional terms – for the implementation 
of Trade Facilitation measures.  The presentation ha d also highlighted the need for well-resourced 
capacity building if Members were to implement Trad e Facilitation measures.  He recalled that, in the 
discussions leading to the adoption of the negotia ting modalities there had been a strong commitment 
by the proponents to provide enhanced technical a ssistance in the area.  It was important, therefore, 
that the approach to technical assistance went be yond the traditional support provided.  It might be 
necessary to consider having a Trade Facilitation Fund, on which Members could draw in order to 
implement their Trade Facilitation needs.  There was also a need to maintain  a balance between Trade 
Facilitation measures and customs control for the purposes of addressing some of the countries’ development needs, especially for those countries  relying on customs revenue for their national 
budget.   TN/TF/M/2 
Page 12  
 
 57. The WCO's Customs Trade Facilitation self-assess ment tool was extremely important.  For 
Kenya, the identification of its needs was a prior ity, and a starting point.  His delegation was looking 
forward to that tool, hoping that it did not apply a one-size-fits-all approach.   
58. The representative of the WCO
 clarified that the comprehe nsive Diagnostic Framework had 
already been developed, covering all customs proce dures.  That tool was currently available and had 
been used by the WCO in some diagnostic studi es.  What the WCO was still in the process of 
finalizing was an outtake from that which would concentrate on Trade Facilitation within the meaning 
of GATT Articles V, VIII and X, which was expected to be ready by February.  It would be a self-
assessment tool, either for use by the country its elf, or by a consultant.  The purpose of the 
development of both the Diagnostic Framework and the outtake was to help identify the particular 
requirements of each country.  It therefore was th e very opposite of a one-size-fits-all approach.  
59. With respect to Kenya's intervention, he noted that he was conscious of the need to balance 
facilitation and control.  In doing so, one had to co nsider two meanings of control: control in the sense 
of security, due to the ongoing debate in other fora  on the security of the supply chain, and in the 
sense of economic security, which was very important to most Members of the WCO.  As regards the 
authorized traders approach, that was something pr ovided for in the Revised Kyoto Convention.  The 
Guidelines to the Convention gave examples of how that was handled in some countries.  Basically, 
the idea was for a trader meeting certain criteria to achieve certain benefits.  So far, there was no 
international standardized set of criteria.  That could be, if it was so decided, the work of the 
Management Committee to the Revised Kyoto Conven tion once that body started its meetings (which 
would only be the case once 40 countries had ratified the Convention). 
60. As regards the questions raised with respect to the Convention, he noted that the number of 40 
as the necessary amount of ratifications had been determined in the course of the negotiations on 
Kyoto’s revision.  There had been much debate on wh at would represent a correct  ratio of ratifications 
in that context.  The final decision had been to set  the threshold at 40, reflecting the fact that the 
current (original) Convention had been signed by 63  Parties, and the feeling that it should only be 
changed if a significant number of them could agr ee to it.  Forty had been a negotiated number.  
61. As to the reasons for it having taken several years to reach the current 37 ratifications, he 
noted that there were no inherent difficulties with any of the contents of the Convention.  It was 
merely a matter of countries amending their national legislation to fulfil the requirements to sign the 
Revised Kyoto Convention.  A number of countries had said that they would sign when the two main trading blocks – the EU and the United States - had signed.  Almost all Members of the European 
Union had signed, with the exception of some who had not been members to the original Convention 
and therefore could not become par ties to its revision, plus two of the earlier 15 EC Member countries 
which had also not signed.  At a recent meeting in Brussels, the US delegation had said that the 
internal work was now complete so that it was only a matter of procedure for the United States to 
ratify the Convention.  It could take a couple of weeks to a couple of months, although he was not 
aware of any particular difficulties.  One had to bear in mind that, when comparing the old 
Convention with its revision, there were significant differences, the main one being that the element 
of optionality was somewhat restricted in the new C onvention.  The original Convention was an "à la 
carte" menu.  One could decide to accept various an nexes or not.  With the revised Convention, it was 
mandatory to take the central body of the treaty, which applied across a broad spectrum of activities.  
Therefore, some signatories to the original Convent ion had to carry out significant national legislative 
amendments before they could sign the revised versi on.  And that was what had taken the time rather 
than any principle objections to accepting the Convention as such.   
62. The representative of Switzerland
 referred to an audit tool fo r transport and Trade Facilitation 
developed by the World Bank.  She wondered about th e relationship between that tool and the WCO’s 
Diagnostic Framework in terms of coverage.    TN/TF/M/2 
 Page 13 
 
 
 63. The representative of Egypt commented on the relationship between WTO and WCO work on 
Trade Facilitation.  He had expected the WCO repr esentative to give his views on the proposals made 
by WTO Members over the course of the past three years on measures to be adopted.  He was seeking 
the WCO’s views on whether there would be some duplication of work between the two 
organizations, given the fact that the Revised Kyot o Convention contained many of those suggestions.  
What could be the additional value of WTO work an d how could the WTO differentiate its work from 
that of the WCO and its Management Committee?   
64. The representative of th e European Communities  noted that his delegation was pleased to see 
that the WCO, like other international organizati ons, was now putting a lot of emphasis, resources and 
focus on the technical assistance dimension of its work .  That was, in some ways, directly related to 
the fact that, over the last three to four years, Trade Facilitation had become an important topic on the 
international trade agenda.  The WCO and many ot her international organi zations were responding 
very well to that.  The EC shared the conclusions drawn by the WCO as to lessons learned and important elements to be taken into  account when providing assistance.   
65. As regards the relationship between the WCO’ s activities and the WTO’s work, it had always 
been the view of the European Communities that th e WCO was first and foremost an organization that 
could develop international standards and instrume nts that could then be drawn upon in the WTO 
context if WTO Members considered it useful to do  so.  That was an approach the EC also found 
useful in many other areas, such as in the field of  Customs Valuation, where the WTO set the broad 
framework, relying upon the WCO for the important area of implementation and the development of 
the standards that underpinned the WTO provisions.  Likewise, in the areas covered by the SPS and 
TBT Agreements, the WTO deferred to the expertise of international standards bodies to fill out the 
broader WTO disciplines.  Certainly, when it came to Trade Facilitation, the WCO’s role would be a 
comparable one.  The WCO was developing some important international standards which, if 
Members regarded them useful, could be drawn upon in whatever they developed in the WTO process.   
66. With respect to the Single Window concept, that  was something already in existence in the 
area of import licensing.  It was embodied in the WTO Import Licensing Agreement, but did not exist more widely.  He wondered to what extent that work  already resulted in an in ternational standard that 
could be fairly readily applied by WTO Me mbers in a Trade Facilitation context.  
67. On Kenya’s comments about the importance of  striking a balance between facilitation and 
control, he wanted to ask the WCO representative to  what extent Trade Facilitation measures, when 
being introduced by customs, actually impeded the ability of customs to carry out other legitimate 
controls, or whether simplified procedures, authori zed traders systems and more modern procedures 
actually improved the ability of customs to collect re venue and to protect the public against dangerous 
goods or fraud.  He wondered whether Trade Facilita tion assisted better controls or whether it got in 
their way.   
68. The representative of the WCO
 said that he was unable to answer to the question raised by 
Switzerland but that he might be able to do so afte r having spoken to the World Bank.  As regards the 
interventions by Egypt and the EC on the bene fits the WCO saw in the Trade Facilitation work 
undertaken by the WTO, he recalled that reference to  them had already been made in his presentation, 
when he listed aspects like it producing a sustai ned high-level political commitment and will to 
customs reform.  It would move customs towards th e center of the stage in some countries and would 
give an additional impetus to the reform and mode rnization of customs administrations throughout the 
world, which was something the WCO welcomed.  It would also enhance awareness of customs 
requirements leading to better customs complianc e of business and it would improve cooperation with 
other border agencies.  It was in that context that  he had mentioned the integrated border management TN/TF/M/2 
Page 14  
 
 and the Single Window.  Work on the Single Window had taken place with the WCO having 
contributed to it.  A draft recommendation was readily available.   
69. On the relationship between the WCO and the WTO, he too saw the WCO’s work to be 
totally compatible with that of the WTO.  The WTO was setting the high principles, while the WCO 
had the implementation tools available.  As rega rds the question of Trade Facilitation enhancing or 
impeding controls, he had no evidence of the intr oduction of Trade Facilitation measures ever having 
impeded controls.  But there was certainly evid ence that Trade Facilitation improved the control 
mechanisms, as it allowed a customs administration to  focus on where the controls should be carried 
out.   
70. The representative of Senegal
 welcomed the initiative to de velop a diagnostic tool.  That 
constituted a positive contribution towards the identif ication of needs and priorities in the area of 
Trade Facilitation as provided for in the negotia ting mandate.  He had understood the WCO to say 
that the WCO’s activities on Trade Facilitation were broader, and that the scope of work done on 
Trade Facilitation in the WTO was far more limite d.  He would like to know the WCO’s assessment 
of the results Members hoped to achieve.  If the WTO limited its activities to the three GATT 
Articles, would Members really be able to speed up operations and would that  have a really positive 
impact on Trade Facilitation?  Furthermore, he would be interested in the conclusions of the study the 
WCO had been carrying out with the OECD on th e costs of Trade Facilitation measures.  He 
wondered whether that study had been limited to the WTO approach to Trade Facilitation or based on 
the WCO scope of work in that area.  As regards th e point made by the EC on facilitation  and control, 
he noted that, in developing countries, there was an  interest to speed up processes, but there was also 
an interest to ensure revenue.  That was different  for developed economies, but for administrations in 
developing countries, customs revenue was essential.  Also, they had to deal with other constraints as 
well, which was why they wanted to have a tight er control on goods.  He wondered whether, in the 
WCO’s experience, the outcome of reforms towards Trade Facilitation had been such that there had 
been a positive impact on customs revenue through a d ecrease in controls.  If that was the case, that 
could encourage other customs administrations to  better integrate Trade Facilitation measures into 
their activities.   
71. The representative of Colombia  stressed the importance of first hand knowledge on the 
activities and strategies of other international orga nizations in the negotiations.  Unfortunately, there 
was no expeditious linkage to customs to obtain th e information referred to by the WCO.  The WCO 
had shed light on certain points relating to the Di agnostic Framework. Colombia would like to know 
the percentage of use of that tool and the pro cedure for accessing it once the WTO-related update had 
been completed.  In particular, Colombia would li ke to know who should ma ke that request, and how 
interaction could be improved so that her country could benefit from the results of the Diagnostic 
Framework in identifying Colombia’s needs and priorities for technical assistance.   
72. The representative of China  agreed with the WCO that customs compliance and Trade 
Facilitation were two sides of the same coin.  One c ould not emphasise just one side of it. If the focus 
was only on customs compliance, trade might be impeded.  And if emphasis was placed merely on Trade Facilitation, it might harm national interests and cause problems in terms of security.  The aim 
of customs should therefore be on strict control and fast clearance.   
73. The representative of Jamaica
 said that things were still not cl ear to him about the relationship 
between the WTO and the WCO.  His impression was that the Revised Kyoto Convention set uniform 
principles for the harmonization and modernizati on of customs procedures, and that it addressed 
issues relating to the clearance of goods, payments of  duties and taxes, customs trade cooperation, 
information supply by customs administrations or a ppeals in customs matters, and that it also covered 
risk management, audit-based verification and mutual administrative assistance between customs 
administrations and other organizations.  That see med to be a duplication of what Members were  TN/TF/M/2 
 Page 15 
 
 
 about to embark on in the WTO.  Jamaica was not sure how the Revised Kyoto Convention, which 
seemed to deal with many of the principles address ed in the Negotiating Group, related to Members’ 
work in Geneva, and whether that work was actually necessary, given the existence of the 
Convention.   
74. He might not have fully understood the point  made by the European Communities on the 
relationship between the two organizations by refe rence to the TBT and SPS Agreements in the sense 
of the WTO setting the principles and the releva nt standard setting bodies then developing the 
standards in those areas.  Those agreements had a specific objective in aiming at protecting animal, 
human and plant life and health, with standards being developed to meet those objectives.  He 
wondered what the objective might be in terms of  customs modernization and harmonization that 
Members would be seeking, and what kind of standards could be derived from that.  Would it be a 
principle that goods should be removed from the bor der without undue delay?  Would the WCO then 
have the responsibility to develop standards to achie ve that across the range of developing countries 
and across the variety of different situations that might apply?  He did not see the analogy with the 
SPS and TBT Agreements to be a perfect one.  The SPS Agreement dealt with certain absolute 
elements such as the protection of life and health, which were of fundamental  importance and, in a 
sense, uniform, where standards could be developed to achieve those objectives.  The development of 
standards in terms of customs modernization and harmonization was somewhat different.  He recognized that taking those issues up in the WTO w ould raise the profile of customs.  But that was 
not the role of the WTO.  For that, one might need a public relations programme by the WCO.   
75. The representative of the WCO
 noted that the scope of the nego tiations had to be determined 
by the WTO.  He personally thought that the GATT Articles Members were looking at in the 
negotiations had an audience wider than customs.  Bu t that was not for him to decide.  The work of 
the WCO had been complementary to that of the WTO.  The WTO would set the high principles with 
the WCO providing instruments for the implementation of those principles.  That was the way things 
had happened in the past. Regarding Colombia’s ques tion, he noted that the general broad Diagnostic 
Framework was already available and could be give n to Colombian customs.  Normally, those tools 
would be free for WCO Members.  If there was particular interest in the outtake, he could come back to that in due time.  As regards the question by Se negal, he noted that, according to his recollection, it 
was found that Trade Facilitation was often the by-produc t of a reform of IT procedures, rather than a 
concentrated effort on Trade Facilitation per se .  But where it was indeed a by-product of a greater 
restructuring, the cost attributed to Trade Facilitati on, if any, was usually recuperated within a short 
period of time.  Costs, where they occurred, were ge nerally attributable to restructuring and training.  
But they were quickly offset by the increase in  revenue, efficiency and productivity.   
76. The representative of Rwanda
 expressed her delegation's interested in initiating a self-
assessment of its Trade Facilitation needs and priorities,  and in using the WCO tool to that end.  For 
Rwanda, one of the most important sources of info rmation on its needs and priorities would be the 
experience gained by its exporters and importers  in transit countries both during importation and 
exportation.  That would help with assessing related costs and the impact of the current situation on 
their businesses.  She wondered whether the WCO tool covered such information and whether, if that 
was not the case, the WCO or the Secretariat coul d provide some guidelines on how to extract such 
information.   
77. The representative of Indonesia  inquired about the scope of cooperation between the WTO 
and the WCO.  The WCO representative had outline d his organization’s engagement in the area of 
technical assistance and capacity building and info rmed about their work on a customs capacity 
building strategy, by which the WCO had res ponded to the Doha Development Agenda.  He 
wondered whether and how the WCO enhanced coope ration and coherence with the WTO in that 
area, especially on the issue of problems encountered  by developing countries.  Reference had already 
been made by previous speakers to cooperation and c oherence, but he was particularly interested in TN/TF/M/2 
Page 16  
 
 cooperation in the more substantive sense.  Indonesi a believed that the WCO had done excellent work 
in compiling problems faced by deve loping countries in the Trade Facilitation area, especially at the 
border.  Indonesia itself had a very big problem w ith capacity building in th at field, due to its 
geographic situation as an archipelagic c ountry with numerous entry points.   
78. He shared the views and concerns expressed by  the Philippines that, in order to commence the 
process, it might be necessary to identify some basi c elements of technical assistance for Members’ 
future work.  He was not sure what the WCO ha d done on the tool they had developed on specific 
problems encountered by developing countries and whether it could also be used in the WTO context to start work on those issues there, especia lly in the area of technical assistance.   
79. The representative of the WCO
 suggested that it might be useful to meet with the delegation 
of Indonesia bilaterally to brief them on the WC O's specific capacity building activities rather than 
going into detail on that matter in the plenary session, in order not to delay the process.  Regarding the WCO’s work with the WTO, the WCO had been invite d by the WTO to participate in their seminars 
in various regions and had discussed customs issues.  With respect to the question raised by Rwanda, 
he offered to provide the Rwa ndan delegation with a recently pr oduced compendium on transit and 
customs-related aspects of transit.   The document went into some detail about the problems associated 
with transit and how they might be solved from a customs perspective.  Based on that document, 
Rwanda could then enter into further ne gotiations with the WCO Secretariat.   
80. The representative of UNCTAD
 noted that UNCTAD had a fairly long history of work on 
Trade Facilitation, going back to the beginning of the organization itself.  The nature of work had 
changed over time.  Today, it was not limited to th e issues related to GATT Articles V, VIII and X but 
went far beyond that. UNCTAD’s current presentation w ould nevertheless relate directly or indirectly 
to those three provisions of the GATT.  When star ting Trade Facilitation in UNCTAD, there used to 
be a programme called FALPRO which dealt with the development of standards at their origins. But 
work had evolved, and UNCTAD was no longer activ e in the development of standards.  Rather, 
UNCTAD functioned as a capacity building organi zation, covering both human and institutional 
capacity building.  UNCTAD believed that capacity building was an important element towards the 
creation of a domestic Trade Facilitation culture .  It was a basic prerequisite for economic 
governance.  
81. Trade facilitation, as UNCTAD saw it, was a wi de embracing activity which lent itself to 
cooperation approaches.  That coope ration extended to vertical and hor izontal cooperation.  Vertical 
cooperation basically implied a division of labour be tween the different types of organizations dealing 
with Trade Facilitation.  That vertical form of cooperation had the rule-mak ing organizations at the 
top, the WTO being the leader in that area.  Sec ondly, there were standard  setting organizations, and 
then implementing organizations which tended to be regional or sub-regi onal organizations. Then, 
there were capacity building organizations , such  as UNCTAD, to support implementation.  In terms 
of horizontal cooperation, there were two basic ty pes of cooperation.  First, there was cooperation 
between the UN and related agencies, including the WTO, in the framework of the so-called Inter-
Agency Cooperation on Trade Facilitation.  Th at cooperation was based on a decision of the High-
Level Committee on Programmes (HLCP), which gove rned the work programme of the United 
Nations and related agencies.  The HLCP created th at mechanism to coordinate activities in the area 
of Trade Facilitation. Regular meetings were held in  Geneva.  On a wider level, there was the Global 
Facilitation Partnership on Transporta tion and Trade, involving all stakeholders, including the private 
sector, other international organi zations and governments. It acted as a private-public sector 
partnership that opened the Trade Fac ilitation agenda to all interested parties.  That was important as 
it was an area where the relationship between the public  and private sector was particularly important.   
82. Trade Facilitation was a process towards the be tter management of trade.  UNCTAD believed 
that it could provide an enabling environment for trade and transport by reducing the overall costs of  TN/TF/M/2 
 Page 17 
 
 
 international trade transactions through the alignmen t on internationally agreed trade and transport 
instruments and commercial best practices.  Ther e was a development issue attached to Trade 
Facilitation.  Trade Facilitation was a development factor as opposed to a mere administrative tool 
with an impact on border crossing operations only.  It aimed at creating commonalities in standards 
and practices, not only between the trading partners ’ respective environments, but also between the 
different actors within the same country.  That domestic dimension of Trade Facilitation issues was 
quite relevant.  When looking at the main compone nts of Trade Facilitation, one could see that it was 
not only customs, but also involved trade and tran sport.  Those were the key elements in Trade 
Facilitation; one could hardly have one without the other.   
83. UNCTAD believed that Trade Facilitation was pervas ive.  It covered institutional, regulatory 
and operational issues, requiring private and public involvement.  It improved the efficiency of a 
government’s control, secured sustainable Trade Facilitation capacity, Information and 
Communications Technologies (ICTs) and linkages be tween national administrations (mainly customs 
and commerce).  Regional trade routes/transport corridors and global transport were needed.  
UNCTAD’s work on Trade Facilitation covered five  main areas:  (i) research and analysis, 
(ii) exchange of experiences and consensus build ing, (iii) information systems development, 
(iv) technical assistance and training and (v) knowledge dissemination.  
84. In the area of research and analysis, UNCTAD carried out work on the improvement of the 
legal framework for transport and Trade Facilitati on.  UNCTAD also developed tools for assessing 
needs and priorities in Trade Facilitation, particular ly for developing countries.  It further developed 
support material for transport and Trade Facilitation platforms.  The earlier mentioned Single Window 
was one type of such a platform, as well as the so-called Trade Facilitation Bodies or National Trade 
and Transport Facilitation Committees which were instru ments to facilitate trade in a country.  Further 
work related to the development of trade and tran sport facilitation clusters.  UNCTAD believed that 
the concept of clusters was important as it brought  people working on trade and transport facilitation 
together.  Finally, UNCTAD was also doing some work on the development impact of security 
measures on developing countries’ trade.  
85. As far as the exchange of experiences and con sensus building was concerned, there were two 
types of meetings:  (i) Expert Meetings, where e xperts shared their views on Trade Facilitation issues 
(examples being the meetings on Trade Facilitati on in November 2002, on multimodal transport and 
logistics services in September in 2003 or the upcoming Expert Meeting on transit transport arrangements) and (ii) intergovern mental meetings.  Last year, a special such event had been 
organized in parallel to the Almaty Conference.   
86. Furthermore, UNCTAD was also doing a lot of work on the development of information 
systems.  There were two basic products which were  closely related to one another.  The first was 
ASYCUDA, an automated system for customs data, which had been installed in 84 countries.  More 
information on the system could be  found on the web under the address: www.asycuda.org
.  The 
second one was called ACIS (Advanced Cargo Inform ation System) a cargo tracking system helping 
the trade to keep track of their containers.  The system had been installed in 18 countries.  More 
information was available on the web under the address www.railtracker.org .   
87. UNCTAD was also engaged in the area of technical assistance, where different types of 
projects were carried out:  (i) inter-regional projects,  such as the one related to the identification of 
needs and priorities in Trade Facilitation, on trans port and Trade Facilitation platforms, on sustainable 
trade and transport capacity for Landlocked Devel oping countries, or IT-based management projects 
like ACIS and ASYCUDA, and (ii) integrated country projects.  Under that category, UNCTAD was currently engaged in two major projects, one in Afghanistan, which had just started, and one in 
Pakistan, which had been going on for several years.  Both of them were executed in cooperation with TN/TF/M/2 
Page 18  
 
 the World Bank.  Furthermore, there were also sev eral smaller projects, such as the one in the ECO 
region for multimodal transport and Trade Facilitation.   
88. Finally, there were activities related to trai ning and knowledge dissemination, such as WTO-
related workshops.  UNCTAD partic ipated in workshops organized by and with the WTO, UNIDO, 
the EU, Japan and others.  UNCTAD also organized tr ade logistics events, such as the one on ICT and 
transport that had been held in Rio, November 2003.  The organization was also involved in longer-
term training based on the mandate given in  paragraph 166 of UNCTAD X relating to the 
International Economic Agenda, which included a chapter on Trade Facilitation. Courses were being 
developed like the one on logistics or the ones deve loped with the World Maritime University dealing 
with legal issues of international trade and transport.  Finally, UNCTAD produced recurrent 
publications, the most prominent example of them be ing the Review of Maritime Transport, as well as 
regular newsletters on Trade and Transport Facilitation.   
89. ASYCUDA was a tool to complement custom s reform and modernization programmes, 
leading to faster customs clearance procedures, be tter valuation of imports  and exports and higher 
customs revenue collection and control.  The implementation of ASYCUDA contributed to the 
formulation of modern customs policies, to the re form of customs procedures, the introduction of 
international EDI standards, to an increase of cust oms yield as well as to a timely production of trade 
statistics.  The latter had been the first pur pose of ASYCUDA.  The main characteristics of 
ASYCUDA included traditional core features like the production of customs declarations, the assessment of customs duties or the production of trade statistics.  ASYCUDA also introduced the Single Administrative Document, the basic document to insert information into the computerized 
system.  Another feature of ASYCUDA was its Direct  Trader Input, allowing traders to launch their 
customs declarations directly into the customs sy stem.  An additional feature of ASYCUDA was its 
Direct Shipping Line Input, enabling shipping lines to provide information c ontained on the manifest 
through EDI to the customs administration.   
90. ASYCUDA also contained two specific modules:  (i) the selectivity transit module, allowing 
customs to identify the shipments requiring inspectio n, based on certain selectivity criteria regarding 
the profile of the trader, the type of product etc,  and (ii) the transit module, allowing customs to 
process information for cargo in transit.  The trans it module was particularly important for landlocked 
countries as a means to monitor tr ansit agreements.  It also prot ected customs revenues for transit 
countries and procured effective monitoring of th e smooth transit of goods, which was especially 
helpful with the process of just-in-time delivery re quired by the industry.  It further supported the 
European T1 and TIR procedures, and took adva ntage of ICT developments.  ASYCUDA was a 
computer software developed and constantly up graded by UNCTAD to take advantage of new 
developments, both in terms of technology and procedures.  It was provided free to customs 
administrations and implemented under UNCTAD superv ision, adapting it to the local conditions of a 
particular country.  Usually, the programme was pa rt of a government’s commitment towards customs 
reform and modernization.   
91. If a country wanted to implement ASYCUDA, a preparatory phase would be initiated, 
involving a diagnosis of the current customs procedures,  of the documents currently in use, and of the 
legal environment.  During that phase, UNCTAD expe rts would work together with customs officials 
to establish a Harmonized System-based tariff th at met the needs of the country. UNCTAD would 
then start modifying the proce dures, introduce the Single Administrative Document, and do other 
work required to run an automated customs system.  Then, the system as such would be implemented.  
That also required the identification of where the system was supposed to be operating in what border 
posts.  A pilot implementation was usually carried out  at headquarters and at airports, as the simplest 
place to run ASYCUDA.  Once it was operating at the p ilot level, preparations began to roll out the 
system at a broader level.  All of that was done in close cooperation with the local customs 
administration.  A lot of training was involved to ensure that the officers fully understood the process  TN/TF/M/2 
 Page 19 
 
 
 – covering both government officials and the trading community.  All further stages were carried out 
by the customs administration itself.  After phase on e, it was up to the local customs administration to 
roll out the system to other places.  They owne d all the elements to implement the system. 
92. As for the logic of Trade Facilitation, as UNCTA D saw it, there had been a coherent approach 
since the very beginning, involving the simplification of procedures, formalities and processes with 
the idea of eliminating all unnecessary elements and duplications.  Another dimension of Trade 
Facilitation was harmonization, involving the ali gnment of national procedures, operations and 
documents with international conventions, st andards and practices.  A third element was 
standardization, which was the process of developing  internationally agreed formats for practices and 
procedures, documents and information.  Those three elements were the basics of Trade Facilitation.  
The use of international standards was basic a nd essential. All trade documents should ideally be 
standardized along the UN layout key.   
93. What had to be kept in mind were the linkag es between different types of Trade Facilitation 
measures. When talking about customs automation, one also had to look at the standardization of 
documents and the simplification of procedures.  Al so, a country’s tariffs had to be adapted in line 
with the HS system.  Only when customs automa tion was available, together with the required 
documentation, the appropriate tariffs etc., could it be  expected to look into matters like customs time 
release, risk assessment, Single Window or post audit control.  Time sequencing was another 
requirement.  The implementation of a particular  measure might require the implementation of 
another measure.  Therefore, when designing  special and differential (S&D) treatment, those linkages must be kept in mind.  Computerization, for inst ance, could not be done until some other work had 
been done on the Single Administrative Document or on the standardization and simplification of 
documents.  For pre-arrival processing or post clearance audit, an automated system had to be in place.   
94. With respect to technical assistance and capacity building, it was clear that, while the scope of 
the WTO focused on the clarification and improvement of the three GATT Articles, it could also 
contribute to a wider scope of Trade Facilitation.  As for the time frame, it would certainly cover the 
negotiating process while also supporting the implemen tation of Trade Facilitation rules in developing 
countries.  One important element of that assistance  related to the identification of Trade Facilitation 
needs and priorities, taking into account a country ’s development dimension.  It included the 
establishment of the capacity to assess those needs and priorities, and to  analyze the cost implications 
of the negotiated commitments.  Finally, technical assistance should also cover training of negotiators 
and officials.   
95. UNCTAD’s contribution to the WTO negotiations  included short-term/immediate technical 
assistance to enable negotiators (both in Geneva  as well as in capitals) to better evaluate the 
implications of the negotiated Trade Facilitation ru les on their development policies and objectives.  
There was also a longer-term technical assistance, which aimed at enhancing national capabilities to 
effectively implement the negotiated Trade Facilita tion rules within the agreed modalities.  That 
would contribute to supporting reforms in nationa l policy-making, as well as to institutional and 
infrastructure development.   
96. A life cycle of an UNCTAD Trade Facilitation project involved an awareness workshop as a 
first stage, leading to recommendations and an ac tion plan.  Based on that, a longer-term project was 
developed, in which diagnostic studies were carri ed out, looking into the institutional, legal, 
operational and human resources-related issues with  seminars being carried out for government 
officials to better understand the issues at stake and co me up with an action plan.  Such plan of action 
was then further developed in phase two, involving  the elaboration of c oncrete proposals through 
thematic workshops, looking into the country’s la ws and regulations in customs, its trade and 
transport sector as well as at its administrative a nd operational measures.  Thought was given as to TN/TF/M/2 
Page 20  
 
 how national associations could be  strengthened with respect to the movement of goods, to freight 
forwarding, customs, customs brokers etc.  Sometimes preparations were started for the implementation of ACIS and ASYCUDA.  All of those activities were accompanied by a Training 
Programme and the development of an implementa tion plan.  The third phase comprised an ad hoc 
implementation of the proposals identified in phase two.  Usually, UNCTAD pushed for the 
establishment of so-called National Facilitation Bodi es and National Trade and Transport Facilitation 
Committees, allowing both the public and the private sect or to sit together,  analyze the issues at stake 
and develop solutions of common interest.   
97. The effective implementation of any Trade Facilitation agenda required integration and 
coordination of trade-related assistance among donors and implementing agencies.  That was also the 
reason for the HLCP and the GFP.  Furthermore,  it was essential to have the broadest possible 
commitment from government institutions, as well as the collective and professional support from the business community, which was lacking in some pr ojects, leading to lacking ownership of the 
programme and the loss of sustainability of the in itiated reforms.  Creating institutional changes took 
time. It did not happen over night.  It did not follow that just because one bought a computer for an 
automated system change would actually occur.  It took time for people to get used to the changes.  
When looking at the implementation of Trade Facilit ation measures, one had to  take into account the 
three main sectors of (i) ministry of trade, (ii) ministry of finance and (iii) ministry of transport.  They had different roles, different agendas and different  functions.  And the private sector had to be 
involved as well.  They had to work together.   
98. UNCTAD’s work was also part of broader coope rative efforts.  UNCTAD was working with 
all UN Regional Commissions, intergovernmental or ganizations such as ITC, UNIDO, IMO, World 
Bank, IMF, WTO, WCO, OECD, and with business sector institutions such as ICC, FIATA and 
IAPH.  Technical assistance and capacity building in the area of Trade Facilitation should not be reduced to the WTO negotiating process.  Multilate ral cooperative action at  national and regional 
levels was required to assist developing countri es in building the capacity to implement Trade 
Facilitation and, particularly, WTO-negotiated rules.  
99. The representative of the Philippines
 noted that her country was a beneficiary of UNCTAD’s 
ASYCUDA Programme which had helped their Bureau of Customs improve its systems and procedures.  Now that the negotiations on Trade F acilitation had started, the Philippines would like to 
know whether UNCTAD had done some specific work related to the three Articles under 
consideration in that process.  If that was the case, it would be interesting to learn about the outcome 
of that research or analysis.   
100. The representative of New Zealand
 sought clarification with respect to a point mentioned on 
slide five of UNCTAD’s presentation.  It talked about the Trade Facilitation components, mentioning 
trade, transport and customs.  He wondered whethe r those had been referred to as all the government 
agencies involved.  He was always concerned when he saw customs being refe renced as the only arm 
of Trade Facilitation, when there were actually ma ny agencies involved at the border.  Customs was 
perhaps the easiest to blame, but, usually, when on e looked deeper, it could be seen that it was often 
quarantine agencies or health ag encies instead, especially for an agriculture exporting country. He 
therefore wanted to check whether th e reference was only to customs.   
101. The representative of UNCTAD  replied that UNCTAD had not worked on the three GATT 
Articles as such.  UNCTAD had been part of the WTO process since Singapore and contributed to it 
with documents for the meetings.  But UNCTAD ha d not looked into the issue of what kind of 
instrument could be implemented for the specific Articles as such.  The current discussion addressed a 
number of issues UNCTAD was dealing with through  its technical assistance programme.  Members 
had put in a lot of work in iden tifying specific measures, which had then been compiled in a document 
by the WTO Secretariat.  Therefore, most of th e measures were already there.  What UNCTAD had  TN/TF/M/2 
 Page 21 
 
 
 been doing recently was to work on assisting countries  in identifying their needs and priorities.  Since 
Doha, UNCTAD had realized the di fficulties countries had in identifying their needs and priorities 
and felt that they could add value to that discussion by developing some kind of guidelines for that work.  UNCTAD was in the process of developing su ch a tool to help countries identify their needs 
and priorities, particularly developing countries.  Th at tool should be available some time in January 
or February 2005, and would probably be the most  valuable contribution UNCTAD could make to the 
Group at that stage.   
102. With respect to the table with  the three components of trade, transport and customs, it was 
true that, too often, Trade Facilitation was looked at as a customs issue, while it was not only customs, 
as even the WCO would agree on.  Customs was es sential and important, but Trade Facilitation did 
not stop there.  Trade should be improved, to o, as well as the way the tr ading community and the 
Ministry of Commerce were working.  And transport had been emphasized as it was often not so much an issue of customs or trade, but of transpor t.  Some countries had very efficient customs, and 
one could clear goods in half a day. But because of inefficient cargo handling, the cargo had to sit for 
a couple of days in the container area, since either  the ports were interested in keeping the cargo for 
some days or there was no sufficient transport capac ity to get the cargo out of the port to the final 
destination.  UNCTAD had also looked at issues such as TBT, where they had worked with UNIDO 
in a workshop, and where UNCTAD had presented issu es related to the confor mity of goods and all 
other problems constituting a barrier to trade.  The reason for only having referred to trade, transport 
and customs was that he had wanted to keep his presentation simple, but clearly,  many other issues 
could have also been added to the table.   
103. The representative of Egypt
 remarked that, when speaking about its possible contribution to 
the negotiating process, UNCTAD had only mentioned the area of technical assistance.  Egypt believed that UNCTAD’s role should go beyond that a nd that research and analysis on the different 
submissions and their impact on the developmen t of developing countries should be an essential 
contribution of UNCTAD.  He wanted to get a response from UNCTAD on that matter.   
104. Furthermore, reference had been made to f unctional linkages, relating most of the Trade 
Facilitation measures like time rel ease, risk assessment etc., to automation.  During the last few 
months, some of the proponents had said that many  of the measures, if not most of them, did not 
necessarily have any major cost implications.  Bu t when seeing that everything was linked to customs 
automation, it became clear that th ere were real costs involved.   
105. The representative of Pakistan
 noted that, like the Philippines, Pakistan had been a beneficiary 
of UNCTAD's technical assistance, and of its ASYCUDA system.  His administration had initially 
thought of switching all software to UNCTAD's system because it was being used by so many countries, but then it reported two serious pr oblems.  The first one was that, although UNCTAD 
claimed the system to be free, a deeper analysis of the overall costs revealed expenses of two million 
dollars which was far more expensiv e than any other customs software.  Secondly, they reported that 
the system had originally been designed for administrations with small volumes of trade and was 
unable to cope with trade volumes beyond that.  He sought comments from the UNCTAD representative on those two points.   
106. The representative of China
 raised a question with respect to slides 25 and 26.  In slide 26, the 
presenter had told the Group that the implementati on of a particular measure might require the 
implementation of another measure.  Furthermore, s lide 25 had outlined the fu ndamental elements of 
customs clearance procedures.  China could see clearl y from that picture that some of those elements 
such as standardized documentation presented a foundation for a Single Window.  She wondered 
whether there was a relationship between risk assessment and Single Window.   TN/TF/M/2 
Page 22  
 
 107. The representative of the European Communities
 fully subscribed to the point made by 
UNCTAD that technical assistance and capacity bui lding must – and did in fact – go well beyond the 
narrow scope of Trade Facilitation work taking pl ace in the WTO.  In the WTO, Members were 
focusing on three particular GATT Articles as the su bstantive scope of the discussion.  But obviously, 
when talking about technical assistance and the whol e development dimension, that went well beyond 
the modest scope of the WTO into areas of transport infrastructure and other fields which were rightly 
high on the UNCTAD agenda.  It had been a ve ry useful reminder to the Group that the 
correspondence was not the same.   
108. With respect to the issue of automation, th e Communities did not completely agree with 
UNCTAD’s suggestion that many facilitation measu res depended upon automation to be successful.  
The presentation by UNCTAD had given the impression that ICT was the key to everything and that 
without it, not very much was possible.  The EC’s experience in that field would suggest otherwise.  
There were many very basic and straightforward simplification measures that could be done without 
any form of automation or ICT such as the use of  the UN layout key and of UN standards for customs 
documentation, the review of one’s formalities and procedures with a view to identifying unnecessary 
ones,  or the  switch  from an ad valorem  system of customs fees to a system of levying fees based on 
the specific service rendered to the importer or the e xporter.  He would even go as far as to say that 
audit controls and risk assessment procedures did not need automation to be successful as well.  Many countries, including most of the EC Member States, had been able to implement those kinds of measures well before computers were invented.    
109. At a recent conference in Southern Africa, speakers from Uganda and Lesotho, from the 
business sector and from the Government had raised  many problems they had in terms of exporting 
their products out of their countries.  Automation was the least of their concerns.  Rather, the problems related to non-harmonization of border openi ng hours, to the requirement to pay a security 
at the border in US$ and having it reimbursed in the local currency with a 20 per cent discount, or to being charged $ 50 for 17 copies of the same document,  or $ 50 per document.  Those were the things 
that worried a lot of traders, especially SMEs.  And nothing of that had anything to do with 
automation.  As the discussion in the Group continued, one would see that automation had an important role to play.  But that was very much at the end of the whole Trade Facilitation 
simplification process and not a pre-condition, nor a beginning.  And if Members could collectively 
reach the same conclusion, that would give some  real comfort to countries worrying about excessive 
costs of implementing measures which in fact should save money for governments and traders.   
110. The representative of Chile
 sought clarification on the issue of customs automation since 
there might be a problem of understanding there.  It was important to be clear as to what was actually meant by that concept, and to know whether one  was merely talking about adopting a harmonized 
system or about standardized documentation.  Fu rthermore, it was also necessary to know whether 
one was talking about something ma ny Members already had.  Finally, she wanted to know whether 
there were any statistics on how many countries had customs automation already in place.   
111. The representative of UNCTAD
 replied to the question by Egypt that UNCTAD was not only 
doing technical assistance, but also research and analysis.  The work it was carrying out on the 
development of guidelines for the iden tification of needs and priorities was one type of such research.  
As for Egypt’s request for UNCTA D to assess the impact of the Trade Facilitation measures, the 
problem was that no specific measures had been pu t on the table so far.  It was an area UNCTAD 
would certainly address as soon as proposals were ava ilable.  UNCTAD would then also look into the 
costs and the difficulties of implementation.  But be fore analysing the impact of a measure, it was 
necessary to know in what context and what form it w as supposed to take place.  It could not be done 
beforehand.    TN/TF/M/2 
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 112. Regarding the linkages with customs automation, he shared the view that many things could 
be done right from the start without automati on, such as simplification, harmonization or 
standardization.  Those issues had been on the ta ble for years – they had been part of UNCTAD’s 
FALPRO programme already 30 years ago.  Basic th ings like the alignment of documents did not 
need automation.  They were essential and one s hould not underestimate their value.  What he had 
wanted to highlight with his presentation was th at automation could not be done without some 
preceding work, and that certain measures could be made more efficient with automation.  But he had not wanted to imply that it was essential.   
113. As for the cost of ASYCUDA, it was a system that had been developed with the assistance of 
governments.  UNCTAD did not sell it. But it was not a system one could just plug in to see it 
function. It had to be tailored to each country’s specifi c situation.  The tariffs used by a country had to 
be fed into the system and it was necessary to re visit one’s procedures and documents.  For all that, 
UNCTAD provided technical assistance to help implement the system.  Some countries had been able to do everything by themselves with only very little assistance from UNCTAD, which was not a 
problem for UNCTAD. UNCTAD was not imposing its support.  The costs varied, depending on what 
a country wanted to put into it. It also depende d on the size of the country and the number of border 
customs points.  The costs could range from perhap s US$ 500 000 to 2 million.  The time spent also 
varied, ranging from 12 or 18 months to 2 years, depe nding on where the country stood in terms of its 
own capacity to absorb the change.   
114. Regarding the question on the relation between risk assessment and Single Window, he noted 
that his reference to that had only been one in terms of a graphic illustration.  What he had wanted to 
highlight was the fact that once an automated system was in place, it would facilitate the work of risk 
assessment and the development of a Single Window.  But it was not a prerequisite, and he shared the 
view expressed by the EC in that regard.  Mo st countries had already established the automated 
system.  It was nothing new.  He could hardly be lieve that a country would process the information on 
its trade without using computers.  What UNCTAD did in the case of ASYCUDA was to try to 
upgrade the system by introducing new technology.  Many countries already had their own systems.  
Computers did cost almost nothing these days and automation had become unavoidable. 
115. ASYCUDA had been implemented in 84 countries.   That was not to say that it was still 
working in 84 countries.  The success ratio varied. In  some cases, there had be en problems.  But that 
was also the beauty of it, as problems led to th e constant improvement of the system.  Another 
interesting aspect was that there were different countries using it.  Right now, UNCTAD was in the 
process of implementing it in Afghanistan, with some of the CIS countries also implementing it.  A 
network could be created of cu stoms being connected through ASYCUDA.  The latest version of 
ASYCUDA was web-based, to ensure that everyt hing was at the most up-to-date stage of the 
available technology.  It was compatible with t hose preferring to continue using the non-internet 
based version.   
116. The representative of Costa Rica,
 commenting on slide four of UNCTAD's presentation said 
that, as a developing country, Costa Rica fully agreed  with the assessment of Trade Facilitation being 
a development factor.  His delegation further shared the comments made by the European 
Communities and by Chile on the issue of automation.  He wanted to take the opportunity to share the 
experience of Costa Rica in that context.  Cost a Rica had implemented the Single Window as a tool 
that did not use electronic formats.  It was yet a nother example which showed that such a measure did 
not require the use of electronic systems or automation.  That was not to say that those issues could 
not help and assist the process of Trade Facilitation, as had already been mentioned.  Costa Rica itself 
had implemented the Single Window, for instance, a nd had in the recent past managed to make the 
system automated so that the documents  were now generated electronically.   TN/TF/M/2 
Page 24  
 
 117. The representative of Malaysia
 noted that the presentations by the WTO, WCO and 
UNCTAD were a good start for Members to prepare themselves for the next stage of the Group’s 
work.  His comments on UNCTAD’s presentation would fo cus on one particular issue that had been 
raised on slide 29 under the heading "UNCTAD's contribution to the WTO negotiating process".  He had taken note of UNCTAD’s reply to the question posed by Egypt on that matter, but wanted to 
expand the question a bit further.  He wanted to be  sure that the reference to UNCTAD's short-term 
technical assistance including UNCTAD help negotiators in Geneva and in capitals better evaluate the 
implications of the negotiated Trade Facilitation rules on government polic ies and objectives was a 
reference to the proposals themselves, not to the negotiated text.  He wondered whether the idea was 
for UNCTAD to assist developing countries in evaluating the proposals that would come in.  
Furthermore, he wanted to learn more about  the process for receiving technical assistance from 
UNCTAD, as many WTO delegates were only va guely familiar with how the UNCTAD system 
worked in that context.  It woul d be useful to know wh at negotiators from developing countries had to 
do to avail themselves of technical assistance from UNCTAD.  He wondered whether there was some 
kind of focal point or whether it was necessary to contact the colleagues dealing with UN matters.  
Finally, he would like to know whether UNCTAD ha d some kind of programme to assist developing 
counties prepare themselves for the negotiations.   
118. The representative of Brazil
 commented on the necessity of using ICT in negotiating Trade 
Facilitation measures, noting that much could be d one without automation and the use of electronic 
forms.  But it could take Members along a different  path. In Brazil, one of the reasons for the 
existence of so many different forms and so many copies of everything in the past had been that each 
of the federal and state administrations involved in trade used to require the same information with 
slight changes.  Negotiating a harmonization of paper forms among such a huge number of 
administrations was very difficult.  It might sound simple, but it was extremely difficult.  Brazil had finally been able to do away with hundreds of different forms, but only at the moment when the 
electronic forms were introduced, as that was the mo ment for completely replacing the entire system.  
With an electronic system, it was no longer necessary to have that many copies as everybody could 
access the information electronically.  Overall, th e question of ICT and automation could not be 
answered beforehand.   
119. Turning to the question raised by Pakistan on whether ASYCUDA could work with larger 
volumes of trade, he wondered whether UNCTAD could elaborate on that.  He had seen in a graph by the World Bank that there was an inverse correlation between the average time spent in customs with 
the volume of trade.  It was important to know wh at kind of measures had a linear correlation with the 
volume of trade, what kind of measures had just on e-off costs and what kind of measures required a 
discrete change.  One had to look at what kind of mone y had to be spent for what level of trade, and to 
know whether those costs increased with a higher leve l of trade.  He wondered whether that was the 
case with ASYCUDA.  The reason for asking that ques tion was that it had often been said that Trade 
Facilitation was something that paid for itself in the end.  But if there was that negative correlation, 
one could get the impression that it was necessary to somehow amortize the costs of Trade Facilitation.   
120. The representative of UNCTAD
 noted that ASYCUDA had been implemented in many 
developing countries where trade volumes were relativ ely modest.  But it could also handle larger 
volumes of trade.  It was currently being implem ented in some European countries with discussions 
also being underway to implement it in Brazil.  And even British Customs had at some stage shown 
interest in upgrading their system by using parts of the ASYCUDA concept.  The problems could rather be found with respect to the rollout of the system.  If the country was large, it required the installation of the system in many border posts.  But there was no limitation in terms of the trade 
volumes it could handle.  There was no need to get a new version of the system because the trade 
volume had increased.  ASYCUDA had been designed for that.   TN/TF/M/2 
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 121. With respect to the Single Window concept, it wa s clear that it did not require automation or 
computerization.  In today’s globalized world, elect ronic data interchange wa s part of international 
trade.  It was something that could not be ignor ed.  Therefore, systems like ASYCUDA, which tried 
to improve trade, would most likely go towards some kind of automation after some basic steps, 
which could not be avoided.  Procedures had to be  re-visited, documents had to be simplified.  
Automation was not always required, but as the development progressed, one would very quickly 
reach the stage where one had to face automation in one way or a nother.  Once the documents had 
been harmonized and simplified, there were syst ems to quickly transform information into EDI 
processable one.  There were UN systems available to help.  One could jump into automation very 
easily.  The techniques and the systems were there, and they did not require major investments.  One 
could not say one would never talk  about automation.  Automation ex isted. It was everywhere.  At 
some point, it had to be taken into consideration.  But one should be careful not to have technology-
depended measures.   
122. With respect to Malaysia’s question on how to  access assistance by UNCTAD, he noted that 
there were country projects available.  Some  countries had approached UNCTAD with certain 
requests, which had then been discussed with th e responsible bodies in the country.  UNCTAD had 
then developed an action plan, drafted a budget and then it was up to the country to find out who was 
going to finance the project.  UNCTAD was not a funding organization.  UNCTAD had to look for partners to finance technical assistance.  Very of ten, UNCTAD was working together with the World 
Bank.  Sometimes it involved infrastructure development, and sometimes it did not.  There were different forms available.  UNCTAD could also work with other donors.   
123. In the context of the WTO negotiations, UNCTAD had received a number of requests from 
countries to organize workshops and similar events.  But the problem was that if UNCTAD started to 
handle those requests individually, it would be qu ickly overwhelmed.  There was a limit to its 
capacity.  Therefore, UNCTAD was in the process of designing, together with its partners from the 
HLCP, the UN mechanism for cooperation on Trade Facilitation and for exploring the best way of 
handling numerous requests for technical assistance in the process of negotiations and, possibly, in the 
course of the implementation stage.  UNCTAD did not want to jump the gun and start before Members had started working.  Once UNCTAD knew a bit more about where the negotiations would 
go, and which shape they were likely to take, they could come up with some kind of solutions. But it 
could not be done beforehand.  That would m ean not making best use of its capacities.   
124. The representative of the World Bank
 introduced his organization, noting that it was a global 
cooperative owned by its 184 member countries which essentially were shareholders.  It was directed 
by a Board of Governors.  The Bank was a developm ent agency that provided policy advice, technical 
assistance, knowledge sharing and development finance.  It consisted of five organizations, but for all 
important purposes, the IBRD and the IDA were the two organizations mostly referred to when 
talking about the World Bank. It had a staff of 11254 in 111 countries and had approved US$ 20 
billion worth of development finance in 2004.  The IDA issued credits for countries with a GDP per 
capita of under US$ 857.  The credit was interest fre e with a service charge of less than 1 per cent and 
had very generous maturity periods.  Loans by I BRD, of which there had been US$ 11 billion that 
year, were for countries with a GDP per capita of over US$ 857.  They were market-based lending 
instruments.   
125. The World Bank’s interest in Trade Facilitati on stemmed from the fact that there was a 
demonstrated strong link between trade, economic  growth and poverty reduction, which was the 
Bank's key vision and purpose.  Significant progress had been made in trade liberalization over the 
last 20 years, leading to reductions in tariffs  and non-tariff barriers. Developing countries had 
increased their share in global trade, but it was an  unfinished agenda.  Whilst there had been a big 
increase in the developing countries’ share of tr ade, it was restricted to a few countries, with 
34 countries not having recorded any increase in inte rnational trade at all over the course of the last TN/TF/M/2 
Page 26  
 
 20 years.  Trade Facilitation was part of that unf inished agenda.  Furthermore, customs and other 
border-related regulatory formalities were increasingl y considered as a more significant barrier than 
tariff rates.  Border formalities were still costing a lot of money.  However, unlike tariff reduction, 
where negotiation was difficult but implementati on was relatively easy, im proving border-related 
procedures and regulatory institutions was a complex process.   
126. While Customs and other border related ins titutions understood the importance of Trade 
Facilitation, they also performed a range of cr itically important functio ns, including revenue 
collection, community protection and national secu rity.  People running customs and other border-
related agencies all said that Trade Facilitation was one  of their key priorities.  But when talking to the 
Ministry of Finance, it became clear that what  they mostly cared about was budget collection.  
Customs collected between 30–50 per cent of all re venue in many developing countries with that 
amount going up to 70 per cent in some countries.  Customs and other border–related agencies also had a huge role to play in community protection.   And, increasingly, they were also very much 
interested in national security concerns.  All of th at had to be balanced against the Trade Facilitation 
aims.  A lot of discussion had taken place on whethe r Trade Facilitation and customs control could be 
managed together.  The Bank was of the view that th at was the case.  There was a lot of evidence to 
suggest that Trade Facilitation measures, which redu ced clearance times, also had a positive effect on 
revenue collection and control.  Reduced clearance times also brought about an increase in detection 
and in revenue collection at the same time.   
127. Discussions had also taken place on whether it was just a customs agenda, or whether it also 
extended to all other agencies working at the border.   The World Bank, in cooperation with the WCO, 
had funded some time-release studies.  They had found that some of those other agencies were at least 
as responsible for border delays as customs.  They al so found that things like port infrastructure could 
be an important cause for delays.  But custom s was a key national institution as the only body 
responsible for the processing of every single impor t, export and transit c onsignments and it could 
work with others to ensure all trade and border-re lated agencies worked together to simplify and 
harmonize systems and procedures.  Customs coul d therefore play an important role.    
128. The Bank recognized that Trade Facilitation work was not easy.  But the Bank had many 
years of experience of working in that field, and had come to the conclusion that productive 
investment in Trade Facilitation based on cust oms and border-processing reform and modernization 
could deliver value for money and sound development results.  The challenge was to help everybody 
benefit from increased trade.  There were three ways for countries to do that:  (i) by improving market 
access through trade policy and tariff liberalization, where a lot of work was already being done;  
(ii) by doing work at the border, involving work  on Trade Facilitation, including regulatory and 
procedural harmonization, simplifica tion and institutional reform of the agencies involved;  or (iii) by 
working behind the border, involving things like improving the investment climate, improving trade and transport infrastructure, and dealing with s upply side constraints.  The Bank was providing 
advice, technical assistance and development financing in respect to all that.   
129. The Bank’s activities in support of trade included several aspects.  The Ba nk elevated trade to 
a prominent role in a country policy dialogue.  For least-developed countries, trade was now reflected in the Poverty Reduction Strategy papers, in all c ountry assistance strategies the Bank had and in its 
day-to-day negotiations and discussions with Memb er governments.  Also, work being done on Trade 
Facilitation in separate parts of the Bank had been brought together into the International Trade 
Department, combining research, poverty reduction a nd economic management work.  Furthermore, 
the Trade Logistics Group had been established, br inging together Trade Policy, Infrastructure and 
Customs/Border Management teams.  They coordina ted their activities and shared information.  The 
Bank was further stepping up its trade– related lending and project operations.  TN/TF/M/2 
 Page 27 
 
 
 130. In Cancun, the World Bank had announced a major initiative to support the Doha 
Development Agenda, involving enhanced support a nd lending for trade-related reforms.  The Bank 
was also involved in improving coordination with do nors and other international organizations.  The 
Bank was a member of the Inter-Agency Meetings  on Trade Facilitation, and was involved in the 
Integrated Framework for TRTA.  They did research, analysis and advocacy work, and prepared 
several publications, like the Customs Modernizat ion Handbook, covering all issues of customs 
reform, including valuation, rules of origin, IT, transit and integrity.  The Bank also published a 
Customs Modernization Initiatives book, consistin g of eight case studies on reform processes, 
highlighting what had worked and what had not, as well as related costs, and lessons learnt.   
131. The Bank was further supporting constituencies fo r reform.  Reference had already been 
made to the Global Facilitation Partnership for Tran sportation and Trade.  This was a Group that had 
been set up a few years ago, involving many members from, inter alia, the private sector, from international organizations and government agencies.   An  important website had been created, which 
was a wonderful source of information on border pr ocessing reform.  The Bank was also involved in 
Diagnostic Trade Integration Studies with the other IF partners including the IMF, WTO, ITC, UNDP 
and UNCTAD.  It also offered diagnostic trade inte gration studies for non-IF countries, looking at the 
entire trade process, including trade policy, transpor t infrastructure and trade-related regulations, and 
producing a report and a matrix for action and priorities.   
132. The World Bank further conducted Trade and Tr ansport Facilitation Audits, looking at the 
whole trade supply chain process and searching for ways of improvement.  So far, these had been conducted in Malawi, Chad, Benin, Zambia, Gu inea, Mozambique, Bangl adesh, the Dominican 
Republic and Tajikistan.  The Bank was also invol ved in supporting Trade Facilitation seminars like 
the ones conducted in Cairo in April 2004, in Geneva in May 2004 (with UNCTAD), in Dhaka in 
June 2004 and in Shanghai in November 2004 (in cooperation with the EU).   
133. Looking at World Bank projects with Trade Facilitation component s between 1996 and 2003 
one could see that there had been 26 projects in 34 countries with a total value of US$ 304 million.  
For the time between the current year and 2006, those activities had been further stepped up with 
respect to Trade Facilitation, with 49 project s in 51 countries and a total expenditure of 
US$ 1.2 billion.     
134. World Bank support for Trade Facilitation within the Doha Round included the provision of 
balanced and accurate information to negotiators  in Geneva and in capitals, including customs 
officials and trade officials.  The Bank tried to fi nd useful and balanced information on the costs and 
benefits and carried out relevant research.  A compe ndium would be prepared on useful materials that 
were available.  Furthermore, the Bank assisted countries in their needs and priority assessment and 
provided advice to that end.  The main difficulty the Bank had in that respect, as had already been 
highlighted by others, was the question of how to do such an identification when not being exactly 
sure what the commitments would be.  How could one assess the difficulty of implementing a 
measure that was not even known?  How did one lo ok at the cost of technical assistance required to 
that end?  And how did one determine what laws wo uld need to be changed, and what administrative 
procedures were required?  How could that be do ne before getting a more precise idea on the scope 
and nature of the negotiations, a nd without knowing what would and would not be included?  What 
was clear  was that the Bank would build on the work of others.  UNCTAD was doing some work on 
a self-assessment tool and the WCO had prepared an  excellent Customs Capacity Building Diagnostic 
Framework.  And they had taken that one step furt her, breaking it into the key elements dealing with 
Articles V, VIII and X to arrive at a smaller, more  manageable checklist.  The Bank would work with 
those organizations to ensure there were no attempts  to re-invent the wheel.  The last thing Members 
needed was another self-assessment checklist or questionnaire that would compete with the others.  
Rather, the Bank would work with those organizations.  TN/TF/M/2 
Page 28  
 
 135. The Bank was also looking at sharing practical  information and best practice approaches and 
provided development finance for long-term Trade Facilitation projects.  All of that was done in 
coordination and partnership with others.  In the last  20 years there had been over 120 loan operations 
with significant customs/border management mode rnization components such as the Russian Customs 
Modernization Project ($ 140 m), the Vietnam Cust oms Modernization Project ($ 70 m), the Tanzania 
Tax Administration Project  ($ 70 m – involving the World Bank , UNCTAD,  DANIDA, DFID, EU, 
FINNIDA, SIDA and IMF) or the Cambodia Trad e Facilitation and Competitiveness project 
(involving a $ 10 million grant, carried out in  cooperation with EU and AUSAID). The Bank 
therefore had a great deal of experience in that area.   They knew what worked and what did not.  And 
they now had some formula they could use to im prove the quality of the Bank’s project work.  The 
Bank was not working alone, but involved other interested partners.   
136. It was important to engage in Trade Facilita tion at the multilateral arena to ensure Trade 
Facilitation commitments from neighboring countries and in one’s key export markets.  The Bank 
wanted to use the WTO to leverage political suppo rt for domestic reform and to lock-in hard won 
reforms.  The principles embodied in GATT Articles V, VIII and X already underpinned many 
bilateral and regional agreements .  Reforms did not start from scratch. Almost everybody was 
engaging in reform.  Organi zations all over the world were looking at transparency.  Thirty per cent of 
all developing countries had already websites to list thei r legislation.  Thirty per cent were also in the 
process of reviewing and simplifying their customs and trade-related legislation.  In terms of appeal 
procedures, the WTO Customs Valuation Agreement al ready involved commitments to establish such 
procedures.  And there were huge benefits associat ed with that.  They all delivered tremendous 
benefits to traders, and they were neither particul arly difficult or onerous, nor particularly costly.  
Those things were feasible. And in many cases, those measures were already part of regional and bilateral agreements.  In APEC, for instance, of the 13 Collective Action Plan items developed by the 
APEC Sub Committee on Customs Procedures, sev eral mapped directly to the WTO Trade 
Facilitation agenda like, for example, Item 2 (Public availability of information, laws, regulations etc), 
Item 3 (Simplification and harmonization in lin e with the Revised Kyoto Convention), Item 7 
(Introduction of Appeal provisions), Item 8 (Advance Classification Ruling Systems) and Item 11 (Risk management).  Likewise, most regional trading arrangements throughout the world were 
typically underpinned by similar provisions whic h mapped to the WTO Trade Facilitation agenda.   
137. What the Bank hoped to see from the Trade Facilitation negotiations was a meaningful 
agreement that delivered real benefits and wh ich left no countries behind.  What the Bank was 
concerned about was LDCs not moving forward throu gh that process.  Trade Facilitation was a global 
good.  It made good sense for all countries.  The Bank also wanted an agreement that took into account the legitimate capacity constraints and impl ementation issues facing developing countries.  
That was what the Bank was all about. And they w ould like to see the Trade Facilitation negotiations 
supporting the overall Doha  Development Agenda. 
138. The representative of Malaysia
 noted that one of the critical points in the negotiations was 
that many Members were not as fortunate as some of their major trading partners, both in terms of infrastructure and resources.  The negotiating moda lities made clear that any commitments would be 
subject to the availability of funding and assistan ce.  Nevertheless, additional support was required 
and he sought clarification on the kind of assistance the World Bank could offer in that regard.  Its 
representative had given the example of Cambodia where some 10 million had been given to assist in 
their Trade Facilitation efforts.  What he would like to know was whether that support was provided 
in the form of a grant.  He also wondered whether,  if similar requests for such support were made by 
maybe 80-90 countries to implement the outcome of  the negotiations, the Bank had the same capacity 
to take up those requests.  Given the fact that  many countries were facing financial problems, he 
wondered whether the Bank was willing to extend its assistance to grants for infrastructure 
development or other projects.  When talking about real infrastructure, the necessary amount would 
be much higher than $ 10 million.    TN/TF/M/2 
 Page 29 
 
 
 139. The representative of Pakistan  noted that the World Bank was doing a great job in the area of 
Trade Facilitation as it applied a more holistic appro ach than most other organizations.  The Bank did 
not only offer technical assistance, but also came up with funding.  He appreciat ed the fact that it was 
also offering support for important things such as infrastructure, building ports and customs houses. The World Bank would be one organization with the ability to help countries with respect to their 
infrastructure needs as mentioned in Annex D. 
140. The representative of Japan
 remarked that many delegations had talked about the 
identification of particular needs and priorities of developing countries, as well as about the need for 
coordination amongst the various agencies. The Wo rld Bank had already addressed the coordination 
issue, but Japan would like to know more about how  that coordination actually worked when carrying 
out Trade Facilitation projects.  By way of an ex ample, he wondered whether, when assessing the 
needs of the recipient country, the Bank would bring in experts from the WCO or UNCTAD, and 
whether they would use the Diagnostic Framewor k developed by the WCO.  Japan would be 
interested in the types of operational collaboration executed by the World Bank.  
141. The representative of Jamaica  thanked the World Bank for indicating the importance of Trade 
Facilitation for developing countries.  Jamaica had ta ken note of the view that bilateral and regional 
arrangements did address many of the issues ta ken up in Articles V, VIII and X and that the 
autonomous measures taken by developing countries al so addressed many of those issues.  That was 
important as it led Jamaica to believe that Articles V,  VIII and X were in fact being implemented in a 
current process, leading to the question of what the problem really was.   
142. His delegation had also taken note of the point made by the World Bank on it being important 
to lock in the reforms taking place.  That was an important issue.  From the presentation, he had had 
the distinct sense that what was taking place was a process of institutional and other development.  He 
wondered whether the important thing was not to lock  in the principle of reform rather than any 
specific measures as such, since the process was on -going and evolving, and whether a locking-in 
process would be productive or count er-productive in that context.   
143. The point on it being important to have one’s  neighbours move in a like manner to improve 
access to one’s major export markets through Trade Facilitation measures was significant.  In the case 
of Jamaica, 70 per cent of its imports comprised raw materials or capital goods.  His delegation had a 
distinct interest in ensuring that those raw ma terials and capital goods cleared customs and reached 
the productive process as quickly as possible.  Jamaica  therefore had a distinct interest in Trade 
Facilitation and in the customs functioning as efficiently as possible.  But in terms of improving 
access to major export markets, most  of those export markets were in developed countries.  He 
wondered whether the World Bank – which had been  doing a great deal of work in developing 
countries – had any kind of inventory of Trade Facilit ation barriers in developed countries, and if any 
such inventory existed to which Members, as ne gotiators, could have some access to help them 
understand how one might improve access to deve loped countries through the Trade Facilitation 
negotiations.   
144. The representative of Colombia  raised two questions with respect to the diagnostic studies 
carried out by the World Bank.  Reference had been  made to the importance of coordination between 
the different bodies.  Her delegation would like to know more about such coordination and about the 
experiences on how that coordination had worked.  She wondered how one c ould have access to those 
diagnostic studies.  Only very few projects had been  carried out in Latin America and the Caribbean 
on Trade Facilitation, although it was quite a large ar ea involving many countries.  And yet, only 
three projects had been undertaken in the period fo r which the Bank had provided information.   
145. The representative of the World Bank  explained that the Bank took a holistic view to 
undertaking a diagnosis of issues.  The WTO Trade Facilitation agenda was impor tant, but reform as a TN/TF/M/2 
Page 30  
 
 process did not start with the negotiations and would also not finish with them.  Reform was an 
ongoing process.  All countries, whether they were developed, developing or least-developed, were 
undertaking some form of reform process in their border management agencies.   
146. Japan’s question about the identification of n eeds was important.  Coordination was a difficult 
thing.  A hundred years from now, people would still call for more coordination.  There should always 
be more coordination.  But, in fact, it was sometime s much easier at the national level than it was at 
the regional and international level.  What one found at the national level – such as with respect to the 
example given regarding Cambodia – was that there we re a lot of agencies working in those countries.  
If one had a project, it was relatively easy to bring them together.  In most cases, everybody wanted to do that because it was very difficult to achieve the ta rgeted gains alone.  But in many cases, there was 
an enormous amount of activities which were not very well coordinated.  Therefore, the donor 
partners were very interested in coordinating.  In that case, it was a matter of bringing them together.  
There were usually, at the country level, existi ng mechanisms for doing so.  When the government 
was interested in a particular project, it was simp ly a matter of asking the donors what they were 
interested in doing and of bringing them together. 
147. With respect to the mentioned mechanisms for undertaking the diagnosis, reference had 
already been made to the Vietnam Customs Moderni zation Project.  Within the terms of reference for 
the development of that process, the Bank had specifi ed that the consultants undertaking that work 
used the WCO Customs Capacity-Building Diagnosti c Framework as their core tool for undertaking 
their diagnostic study.  They had done so for good reason since they believed in a comprehensive 
approach.  And one of the strengths of the WCO tool  was that it covered not just the technical issues, 
but also the management-related issues.  Therefor e, it paid due attention to issues such as human 
resource management and development.  It gave attention to matters such as good governance, and to 
supporting issues such as having a sound legal framewo rk.  It was a very comprehensive tool which 
was why the Bank had used it, and would probably continue to use it in the future.   
148. As for the issues raised by Colombia, the di agnostic trade integration studies had essentially 
been undertaken for least-developed countries unde r the Integrated Framework.  Benefiting from 
those activities was essentially a case of requesting such  a tool.  If Colombia met the criteria, the Bank 
would be very interested in supporting those programmes with the support of the Integrated 
Framework partners.   
149. The Working Group of the Integrated Framewor k had met earlier that day with several 
colleagues participating.  The six agencies involve d had been working in close collaboration.  The 
Bank had taken the lead in the so-called diagnostic  trade studies.  Trade Facilitation had increasingly 
come up in the context of those diagnostics as an important issue, and it was also becoming more and 
more common as regards the priorities identified in  policy interventions as a follow-up to the IF.  
Therefore, a mechanism had been set up for the LDCs  in the form of the IF, which provided a channel 
for collaboration and coordination between the six ag encies active in the area of Trade Facilitation.   
150. With respect to grants, the World Bank responded to the demands of its shareholders.  There 
was a debate going on in terms of increasing the pro portion of grants in the Bank’s type of financial 
assistance.  It was an area where demand existed in  a very clear manner.  For the fiscal year 2004 
alone (which ended on 30 June 2004) – the Ba nk had financed roughl y US$ 500 million between 
credits and loans in the area of Trade Facilitation.   And there were another US$ 800 million in the 
pipeline for the next two fiscal years, with the exp ectation of the final amount even going beyond that.  
It was an area on which most developing countries were quite willing to vote with their own purses, 
and even negotiated loans or credits on a case-by-case  basis.  For the highly-indebted developing 
countries, there were options to be discussed.  The situation of Cambodia was that the Bank would be glad to explore other opportunities when the conditi ons so applied.  The Bank was considering all  TN/TF/M/2 
 Page 31 
 
 
 options. The important point was that many of the governments were quite willing to borrow on Trade 
Facilitation right now because there was a strong rec ognition of its potential economic benefits.    
151. The Chairman  noted that, judging from the interest shown by delegations in the presentations, 
it had been a useful exercise which had provide d a good start to the substantive work of the 
Negotiating Group.   
152. Members had heard many comments and ques tions from delegations on the technical 
assistance and capacity building activities of the international organizations that had made 
presentations under that agenda item. There were tw o areas in which Members could usefully ask the 
WTO Secretariat to follow-up on their behalf.  One was to help Members clarify how best to encourage and support the collaborative effort amongs t international organizations that was called for 
in paragraph 8 of the Group's ma ndate, "in order to make technical assistance and capacity building 
more effective and operational and to ensure better coherence" in the area of Trade Facilitation.   
153. The second was to help Members identify how they  could individually make best use of the 
technical assistance and capacity building activities that were available from those international 
organizations in a practical way to target their indi vidual needs and priorities.   Such an exercise would 
help the Negotiating Group appreciate what was alr eady available in that area, and would assist in 
identifying any gaps Members wanted to fill, as well as any improvements which could be made.   
154. Suggestions had been made by several dele gations about using WTO technical assistance 
activities to help developing and l east-developed countries identify thei r priorities and needs in that 
area.  One might wish to think about whether that was a practical suggestion, and whether were there 
were other ways to achieve that result through the activities of other organizations.   
155. Suggestions had also been made about getting input from the private sector in developed and 
developing countries.  And questions had been raised  about how funding would be made available for 
Trade Facilitation projects.  Some of those issues  might be better handled by other international 
organizations than by the WTO Secretariat, which was limited both in terms of its resources and its 
core mandate.  One of the objectives of the negotiatio ns was "to aim at enhancing technical assistance 
and support for capacity building in this area".  In  order to do that, it was necessary to have a good 
foundation to build on, and he would like to suggest for Members to turn in the first instance to the 
WTO Secretariat to provide the Group with a work ing document covering the issues that had been 
raised by delegations that day on which it could base its further negotiations.   
156. The representative of the OECD
 briefed the Group about OECD activities in the area of Trade 
Facilitation.  In the OECD, the main activities were  about research and analysis and were aimed at 
knowledge sharing.  All of those aspects were not  limited to the OECD’s membership, but expanded 
to developing countries, with development aspects  and concerns by developing countries more and 
more having been taken into account.  In the area of Trade Facilitation, work was directly led by the 
discussions in the WTO.  Whatever the OECD had d one over the course of the last 3-4 years followed 
closely the Geneva discussions and the concerns expr essed in that context.  Work had been geared 
towards analysing different issues in discussion in  Geneva and providing material and supporting 
documents to help Members with their work.  Pr ior to Cancun, a series of documents had been 
prepared on country (best) practices and appr oaches relating to the three GATT Articles under 
discussion.  Those documents had been made ava ilable to the CTG and would also soon be made 
available to all WTO Members in a compiled form as a reference document.  What she wanted to refer to more specifically was an ongoing work in the OECD on analysing and identifying costs of 
introducing and implementing Trade Facilitation meas ures.  Members had already received a progress 
report relating to that work and she was now able to provide more specific information of its content.  TN/TF/M/2 
Page 32  
 
 157. Work had been initiated to address concerns  of WTO Members with respect to cost 
implications of possible Trade Facilitation measures.   It had also been started in response to the 
observation of there being very little informatio n available that would allow for a clearer 
understanding of what those cost implications of proposed measures would be.  The OECD Trade 
Committee had issued a request to  collect information on that matter.  The WTO document compiling 
all the proposals made by WTO members on how to clarify and improve GATT Articles V, VIII and 
X had been taken as a reference (G/C/W/434).  From  that document, 11 measures had been identified 
as being of particular importance for providing e fficient and effective procedures for international 
trade, and countries were identified which had r ecently introduced, or were in the process of 
introducing those measures, asking for their coope ration in identifying the costs of putting those 
measures in place.  
158. As a first phase, four countries had been cove red: Chile, Latvia, Moro cco and Uganda, with 
the help of delegations of those countries, especially  from Chile, and with the help of the WCO.  All 
countries had been visited with data being collect ed about the measures under examination, e.g., 
transparency, publication and availability of inform ation, consultative and feedback mechanisms and 
communication with traders, review and appeal procedures and due process, advance lodgement and 
processing of data, procedures for the assessment, co llection and repayment of duties and taxes, risk 
assessment, audit-based controls, special procedures for authorized traders, separation of release from 
clearance, security for duties and taxes and coopera tion and coordination among different authorities.  
Information technology and automation had not been examined as a separate item, but had been taken 
into account to the extent they were used to put th e listed measures in place.  On the other hand, the 
study did not attempt to evaluate the costs of wide r infrastructure measures such as the introduction of 
a telecommunications network since that was not the subject of the disucssion in Geneva.   
159. The first stage of the study allowed a number of  observations with respect to the methodology 
for assessing Trade Facilitation costs.  For instance, it became clear that trying to obtain cost estimates 
exclusively in monetary terms did not render suffi cient results.  The analysis had therefore been 
extended to include information on human resource variations.  It also emphasized the value of 
elaborating performance indicators in order to prop erly assess the effectiveness of reviewed measures.  
The study strongly pointed to the importance of  coherence between various Trade Facilitation 
measures as well as to the fact that certain measures could not happen without other measures.  It also 
underlined the need to factor in linkages betw een measures that could not be implemented in 
isolation.  Finally, it stressed the significance of the time factor:  in order to get an accurate picture of 
a measure's cost implications, its costs and benefits needed to be assessed on a comparable time scale.  
There might be cases with significant starting costs,  with the benefits sinking in over a longer period 
of time.   
160. Although the current country sample was very small and the selected countries were very 
different from each other, some common observations could be made after reviewing their recent 
endeavours.  Most facilitation measures were not th e prime objective for reforms, but were part of 
larger efficiency-enhancing endeavours.  Because  of that, they had helped in introducing new 
approaches for achieving traditional mandates. Resources for introducing and implementing them 
were in many cases absorbed in normal administra tive operational costs.  While that clearly meant 
that countries which were already more advanced in the area of Trade Facilitati on, were able to move 
faster and found it easier to make progress with a minimum of change and expense, it also showed 
that even those countries, which were still in thei r first steps, were able to obtain important and 
significant benefits from their endeavours.   
161. Among the measures selected for review, the most significant costs were incurred in the 
technically demanding areas of risk assessment, audit-based controls and special procedures for 
authorized persons, because of the n eed for infrastructure and training.  However, those costs were by 
no means very important when looking at the overall endeavours and the benefits obtained.  All other  TN/TF/M/2 
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 measures did not entail any significant costs, in the sense that usually resources which had been used 
in other, less productive tasks, were transferred so  as to do things differently.  The overall bill was 
therefore not significant.  Among those measures, the publication and availability of information, 
consultative and feedback mechanism, review m echanisms, or cooperation and coordination among 
authorities had been able to put in place without automation.  Automation was not necessary for those 
measures.  However, there was need for at l east partial automation for measures like advanced 
lodgement.  And measures such as risk assessment and audit presented much better efficiency when 
done with the support of automation.  
162. Further studies would follow.  The OECD was in the process of seeking cooperation with a 
number of other counties, especially in Asia and a number of LDCs in Africa, and was hoping to have 
a sample of 15 to 16 countries by mid-2005.   
163. The representative of Chile  expressed her delegation’s satisf action with having been one of 
the countries where costs had been an alyzed.  As the question of cost s was very interesting and very 
important in the area of Trade Facilitation, it was im portant to have a methodology that could help 
Members in that process. Her question to the OECD related to the benefits of Trade Facilitation.  
Those measures under consideration did generate a num ber of benefits, some of which had also been 
recognized, but she would like to learn more about the OECD's view on those benefits.  
164. The representative of the OECD  noted that, while the present study had indeed not 
particularly focussed on the benefits, previous studies by the OECD showed that there were 
significant benefits in all of those measures.  Trade facilitation endeavours had been looked at 
comprehensively in the past by the OECD where it had become obvious that many of those measures 
paid for themselves.  Some might be aware of a study published last year by the OECD which had 
analysed a number of reforms carried out in the Trade Facilitation area and had shown that related 
costs were recouped by enhanced revenue collection.   In the case of Mozambique, for instance, such 
increased revenue collection had paid for the cost of the reforms in 14 months.  A look had also been taken at the cost collection ratio brought about by  the new efficiency enhancing measures with the 
result that Mozambique compared very favourably with the OECD average.  During the reform, it 
took them between US$ 15 and US$ 21 to collect US$ 1000 revenue, which was middle OECD average and far better than a number of other develo ping countries.  It was the opinion of the OECD 
Secretariat that there were very important benefits to be gained by putting those measures into place.   
165. The Negotiating Group took note
 of the statements made.  
B. CONTRIBUTIONS ON THE AGENDA OF THE NEGOTIATING GROUP  
166. The Chairman  said that, under the second item, delegations  would be invited to contribute on 
the Group's agenda, as adopted at the last meeting.  He recalled Members' ag reement on it covering all 
elements of Annex D, as listed in the Work Plan .  He had understood from Members that there were 
several delegations wishing to address them in a cross-cutting manner, which was why he would organize the discussions in a flexible way, and a llow the addressing of multiple aspects at the same 
time.   
167. The representative of Singapore
 said that it was apparent from the modalities and from the 
preceding phase of clarification work in the C ouncil for Trade in Goods, as well as from the 
presentations made by the international organiza tions, that Trade Facilitation spanned a range of 
activities, which included, but went beyond, classic cu stoms procedures.  It was not confined to a 
Member's national borders as it included also trans it trade and thus involved several agencies at the 
national, regional and in ternational level.   TN/TF/M/2 
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 168. The importance of the involvement of internati onal organizations was amply illustrated by the 
presence of the WCO, the World Bank, UNCTAD and the OECD at the current meeting.  Members had all benefited from the comprehensive and exce llent presentations by those organizations.   
169. In Singapore's view, a basic objective of Tr ade Facilitation would be cutting red-tape – 
simplifying and streamlining procedures and pro cesses.  Apart from that, economic operators and 
governments looked for predictab ility and consistency, as well as for the non-discriminatory 
application of measures.  Such underlying principl es could be found in regi onal and bilateral trade 
agreements such as in Article 2 of the ASEAN Fr amework Agreement on the Facilitation of Goods in 
Transit, which listed a series of principles including MFN treatment, consistency, simplicity and transparency.  Those principles underpinned the th ree GATT Articles referred to in the negotiating 
modalities and could amplify them.  Simplification was an underlying tenet of GATT Article VIII, in 
particular of its paragraphs 1(b) and 1(c).  Abolishing unnecessary and obsolete procedures and 
processes would be one obvious obj ective.  Equally important woul d be the updating of relevant 
procedures and processes so that they were synchroni sed with the trading environment.  Consistency 
and predictability were part and pa rcel of the transparency and du e process commitments envisaged in 
GATT Article X.  Non-discrimination between modes of  transport, flag of vessels, place of origin or 
departure of the goods, etc. was also a common i ssue in the area of transit trade.  Those were 
examples of clarifications and improvements to the existing GATT Articles that could be discussed in the present negotiations.  The costs involved in im plementing those measures would be nominal, on 
the whole.  And the benefits would potentially fa r outweigh the costs.  Members had also seen from 
the presentations by the international organizations  that some of those principles were the basic 
building blocks for Trade Facilitation. 
170. With respect to the issue of technical assistan ce and capacity building, it was encouraging to 
note that the presentations had shown a significant amount of such support to  be already provided, 
with more being in the pipeline.  It was important that technical assistance genuinely met the needs of 
developing and least-developed countries in respect of  the negotiations.  Suggestions had been made  
earlier about drawing up a list of needs, based on p ast seminars and workshops.  In Singapore's view, 
that could be useful in the context of trying to im prove technical assistance efforts.  At the same time, 
it should be recognized that the provision of technical assistance and capacity building was an ongoing process which would need to be fine-tuned when issues became clearer as Members moved 
forward in the negotiations.  That made it all the mo re important for Members to engage fully in the 
negotiations.  A genuinely Member-driven process would ultimately have a positive impact on the 
quality and focus of the technical assistance donors were  able to provide.  Singapore looked forward 
to participating actively in the Negotiating Group on Trade Facilitation, the results of which would 
contribute significantly to the development agenda of the Doha Round.   
171. The representative of Zambia
, speaking on behalf of the least-developed-countries, reiterated 
the importance of assessing and addressing the different development levels of all Members in 
relation to Trade Facilitation, partic ularly of the LDCs.  Such an asse ssment was vital to developing 
and least-developed countries as it was the only pragmatic and effective way forward.  It would assist Members in identifying and achieving technical assi stance benchmarks for Trade Facilitation.  Also, 
since special and differential treatment was an integral part of the negotiations, as shown in 
paragraph 2 of Annex D and reflected in the ag reed Work Plan, the assessment would assist in 
identifying Members' needs and specific situations and their ability to implement whatever might be 
agreed upon in the future.  Furthermore, the asse ssment would also help Members consider and 
evaluate possibilities to harmonize their Trade Facilitation regimes.   
172. Paragraph 5 of Annex D committed Members, es pecially developed ones, to "adequately 
ensure" support and assistance in the course of the negotiations.  The LDCs hoped and looked forward 
to seeing the operationalization of that support as well as of other S&D-related issues.  Furthermore, 
they hoped that the negotiations would take into account work done by the WCO and other relevant  TN/TF/M/2 
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 international organizations such as UNCTAD, as sti pulated in paragraph 9 of Annex D.  The LDCs 
looked forward to constructively engaging in the negotia tions in this new area of interest to them, and 
hoped that the Membership would appreciate and address their concerns.   
173. The representative of Bolivia  said that the current discussions as well as the experience and 
the bilateral, sub-regional and s ub-regional efforts of countries s howed that the need for Trade 
Facilitation was a priority.  The aim was to reduce time and costs of marketing operations for goods 
and services to benefit their users.  The Doha Manda te and the recent guidelines contained in the July 
package were all guided by the principle of specia l and differential treatment to provide developing 
and least-developed countries with substantial market  access.  For Bolivia, that objective could not be 
achieved in fair terms through the el imination or reduction of tariffs, tariff peaks, non-tariff barriers or 
technical barriers to trade alone.   
174. Being landlocked involved additional obstacles and costs.  An ECLAC study dated March 
2003 had shown that Bolivia's transport costs were  66 per cent higher than those of Mercosur 
Members  with access to the sea, and 240 per cent highe r than those of the United States.  That made 
it difficult for Bolivia to have comp etitive access to multilateral transpor t.  Together with insufficient 
physical infrastructure, direct dependence on trans it states was decisive in determining the effective 
export competitiveness.  It was important to address th at problem, looking also at the available input 
from other international institutions and other fo ra, where major studies and analysis had been 
conducted, and at the contributions made by Member s in similar situations.  The clarification and 
improvement of relevant aspects of GATT Articles V,  VIII and X was an area in which Bolivia had an 
interest.    
175. The representative of Japan  said that, in Japan, Trade Facilitation had been a priority issue not 
only for the Government, but also for the private sector.  In April,  Japan's major business organization 
had requested that "all WTO Members should join  together in drawing up a trade facilitation 
agreement within the timeframe of the DDA, as an  essential part of the Single Undertaking" which 
should be put together with the participation of all Members, covering broad aspects of trade-related 
procedures and being based on principles like transp arency, simplicity and standardization.  The 
reasons for the call of Japan's business community  for an agreement on Trade Facilitation were the 
procedural problems they faced on a day-to-day basis when trying to move goods across borders.  They included difficulties such as extremely comp licated documentation requ irements, rejection of 
documentation in case of minor errors, complicated duty refund procedures leading to delays in refunds, vaguely defined customs classification a nd unclear other norms leading to too much 
discretionary power of officials, difficulties in obt aining information on trade rules, sudden change of 
procedural and administrative measures and the lack of effective appeal procedures.   
176. Those were not only problems for Japan's business community, but also for every other party 
engaged in trade.  The Japanese Government fully  acknowledged those views and was of the opinion 
that governments could also benefit from Trade Faci litation, as it would allow them to allocate their 
limited resources more efficiently, thereby leading to  better revenue collection and enhanced ability to 
handle increasing trade volumes.  In order to meet  the strong expectations expressed by business and 
in view of the potential benefits accruing to its gove rnment as well, Japan w as willing to contribute to 
the promotion of the negotiations for their successful conclusion.   
177. While Japan strongly called for negotiations to pr oceed with a view to further expediting the 
movement of goods around the globe, it was also fully aware of concerns about limited 
implementation capacities as expressed by some deve loping Members and reflected in the negotiating 
modalities.  Japan agreed that necessary technical assistance for capacity building to implement the 
outcome of the negotiations had to be  provided in line with the agreed modalities in Annex D.  In that 
context, and in the light of the importance of Trade Facilitation for the promotion of global trade, Japan had been actively providing assistance to many developing count ries.  In the area of customs TN/TF/M/2 
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 procedures, for example, Japan had provided s upport through various assistance schemes including 
bilateral assistance, support through JICA (Japan International Co-operation Agency), APEC and the 
WCO in implementing WTO Agreements, such as th e ones on Customs Valuation, Rules of Origin 
and TRIPs.  That assistance included the hosting of  seminars to improve the understanding of the 
merits of Trade Facilitation and the providing of procedural guidelines for efficient trade-related 
services.  Furthermore, Japan was currently dispatch ing five customs experts on a long-term basis to 
the Philippines, Indonesia, the ASEAN Secretariat, Vi etnam and Cambodia in order to assist them in 
promoting various customs reform projects.  Japan  was willing to continue providing such assistance 
while paying attention not to duplicate work ca rried out by other developed Members and by 
international organizations.   
178. As part of its endeavours in the area of capacity building, Japan, in collaboration with 
Thailand, had hosted an APEC seminar on Trad e Facilitation in Bangkok, as a contribution from 
APEC to the WTO negotiations.  The seminar had pur sued three major objectives:  (i) deepen APEC 
Members' understanding of Trade Facilitation, (i i) provide opportunities for identifying Trade 
Facilitation needs and priorities, and (iii) offer an opportunity to enhance A PEC's contribution to the 
WTO by making negotiators and othe r relevant officials from APEC economies more prepared for the 
Geneva negotiations.  A preliminary summary of the seminar was available to Members in the room.  
The agenda of the event had consisted of four pa rts:  (1) WTO Framework Agreement in the July 
Package, (2) benefits of Trade Facilitation, (3) needs and priorities in Trade Facilitation, and (4) 
capacity building for Trade Facilitation.  Many pa rticipants had expressed the view that reducing 
administrative formalities could both facilitate trad e and reduce administrative costs, which would 
result in more efficient resource allocation for cust oms and other border agencies.  Participants also 
recognized the need for the involvement of various  stakeholders including all border agencies and 
relevant private and public sectors.   
179. On the issue of Trade Facilitation needs and prior ities, participants shared best practices and 
experiences relating to GATT Articles V, VIII and X.  Lessons drawn from those experiences 
included the importance of a strong political will and of a sense of ownership on the part of the 
reforming economies for the successful execution of  Trade Facilitation measures.  On capacity 
building for Trade Facilitation, participants shared the views that effective a ssistance also required an 
appropriate diagnosis of the needs, as well as a good sen se of ownership on the side of the recipients.  
Participants agreed on Trade Facilitation being an ongoing collaborative process, which required 
continued efforts by all stake-holders involved in trad e, and on it not being a goal in itself, but a useful 
means to support national reform policies.  Particip ants also emphasized the importance of continuing 
that kind of initiative in the future.  In that conn ection, Japan was planning to hold a WTO Roundtable 
on Trade Facilitation in cooperation with Australia, Ca nada, Malaysia and the United States as one of 
APEC's projects in Geneva early next year.  Details would be provided in due course.   
180. The representative of Chinese Taipei
 said that there was general recognition of efficient, 
simple and transparent international trade procedur es being able to speed up the movement of goods 
across borders, improve competitiveness in interna tional trade, promote a more reliable trading 
environment and contribute to global economic grow th and poverty reduction.  For those reasons, 
Chinese Taipei was in favour of ambitious negotiati ons.  At the same time, Chinese Taipei attached 
great importance to S&D treatment, technical assist ance, capacity building and transitional periods.  
Financial and human resources of the least-developed countries had to be taken into account as well.  
To further strengthen Members' capacity building,  it was important to have coherence in global 
economic policy making and coope ration between the WTO, the IMF and the World Bank.   
181. With respect to the clarification and impr ovement of GATT Article VIII, it would be 
appropriate to focus part of the discussion on th e establishment of a methodology to analyse the 
relationship between costs and services rendered.  The Group could perhaps ask those international 
organizations with experts in that area to offer n ecessary assistance.  As for Article X, the only current  TN/TF/M/2 
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 requirement was for relevant regulations to be pub lished.  To help the business community obtain the 
necessary information, the Group could discuss how  that data could be more easily accessed.  
Advantage could be taken of the availability of m odern technology such as the use of websites, to 
achieve that goal.   
182. With respect to the identification of trade facilitation needs and priorities, Members should 
consider developing simplified, standardized and transparent clearance procedures based on 
international standards and instruments as one of th eir top priorities.  Other measures such as risk 
assessment, control techniques, post-entry audit, use of IT/automation, pre-arrival declaration, 
advance rulings, appeal procedures and the establishmen t of partnerships with traders should also be 
considered.  Much of that could be achieved to a greater extent through policy adjustments and 
education and training of human resources without the need for large investments in infrastructure.   
183. With respect to work by and with other international organizations, the WTO should 
encourage Members which were also Members of the WCO to expedite the ratification of the Revised Kyoto Convention.  The enforcement of that Conve ntion would facilitate the negotiating process.   
184. The representative of the Philippines
 said that the WTO briefings on GATT Articles V, VIII 
and X should be the starting point for the Group' s discussions and negotiations.  His delegation 
recognized that the July text expressly limited the negotiating mandate to those provisions.  In that 
regard, the Philippines would like to make reference to  the compilation prepared by the Secretariat in 
document G/C/W/434, summarizing the proposals on va rious provisions relating to Articles V, VIII 
and X.  It would be a useful starting point for the discussions, along with the caveat of Annex D expressly amplifying important other concerns, includi ng technical assistance and the identification of 
costs. Work should aim at discussing those existing proposals and at gathering additional inputs and 
submissions from Members relating to  the above-mentioned concerns.   
185. The Philippines also believed that Members s hould be open to inputs and suggestions from 
the private sector and observer organizations to ob jectively and frankly discu ss the identification of 
the various components of their work on Trade Facilitation.   
186. Work undertaken by the WCO on Articles V, VIII and X should be treated as a rich source of 
technical input.  The Philippines looked forward to the needs assessment tools developed by the WCO 
and UNCTAD, which would be available in early 2 005.  The WCO's Time Release Study would also 
be an important tool to ensure that the goals of  the negotiations would be balanced and result in 
effective increased market access for all developi ng and least-developed countries.  The Philippines 
would also like to invite further study on the me chanisms for the legally binding commitments under 
the Kyoto Convention.   
187. The earlier discussions had shown that there seemed to be a desire to get more specificity on 
the definition and the scope of Trade Facilitati on, as well as on the role of automation and 
infrastructure.  It increasingly became obvious that improved technology, necessary equipment and 
infrastructure were important cost factors.   
188. The Philippines would like to see certain ob servations and findings being compiled from 
technical assistance activities of the WTO, WCO, UNCTAD and the World Bank in order to allow Members to review their needs and priorities.   
189. As the representative of the Core Group, he  would like to note that the Group remained 
engaged in the discussions.  The clarification and im provement of Articles V, VIII and X would be an 
important aspect of the ongoing negotiations as would th e identification of benefits and costs through 
an objective and frank discussion to provide Memb ers with a better understanding of what Trade 
Facilitation needs and priorities woul d have to be considered.   TN/TF/M/2 
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 190. Trade Facilitation was an evolutionary process.  A frank discussion had to take place of the 
real cost implications if the negotiations were to advance.  There would be regulatory costs, 
institutional costs, trading costs, equipment – a nd infrastructure costs.  A clear understanding was 
required of the extent of those costs and their im pact.  The issue of training and IT personnel costs 
was important, too.  Those costs were quite subs tantial and often neglected.  Training courses 
involved the establishment of new staffing patterns,  including the need for additional computer 
training personnel in all levels and continuous updates on latest tec hnology.  The importance of those 
elements for the successful implementation of  Trade Facilitation measures could not be over-
emphasized.  It was only with the full awareness of  all those aspects, and of the suggested measures, 
that Members would be able to move  forward with the negotiations.   
191. With respect to technical as sistance and support for capacity building, the APEC seminar 
presented the case of the business sector supporting Trade Facilitation initiatives by providing IT 
hardware and other related assistance.  The issue of how to coordinate properly the assistance by 
various donors was important, as also reflected in the July mandate.   
192. The representative of Hong Kong, China
 stated that the information provided in the previous 
presentations was very timely and useful in en abling Members to better understand the three GATT 
Articles and the related work of the relevant in ternational organizations, in particular on aspects 
concerning technical assistance and capacity build ing.  Undoubtedly, the Group now had a solid 
ground on which to move forward.  Through the con certed efforts of all Members and international 
organizations, a vast amount of information had been  made available.  Members should make best use 
of that information when working on finding common ground and formulating proposals in the 
upcoming negotiations.   
193. Trade Facilitation was a major priority in th e trade policy of Hong Kong, China.  Any 
improvement on the existing trade rules would no doubt enhance efficiency, reduce costs and bring 
tangible benefits to businesses, consumers as well as governments.  Hong Kong, China was convinced 
that the adopted Work Plan would be instrumental in  taking the negotiations forward.  All elements of 
the modalities were inter-related.  The challenge fo r the Negotiating Group's future work was how to 
approach the discussion in an integrated manner.  In that regard, Hong Kong, China believed that it 
should be a Member-driven process.  When Member s came up with proposals, attempts should be 
made to address the different elements of the modali ties in a cohesive manner, including, for instance, 
the important elements of assessing needs and pr iorities of Members, special and differential 
treatment for developing and least-developed countri es and technical assistance and capacity building.   
194. Hong Kong, China fully understood the significan ce of Trade Facilitation.  In addition to 
having an open and free trade regime, Hong Kong, China had implemented in the past few years a 
number of measures to facilitate trade, such as  simplified licensing procedures and requirements, 
enhanced transparency in licensing and customs procedures and the introduction of EDI services for 
government trade documents.  Its experience ha d shown that successful implementation required 
government agencies to take certain fundamental GATT and WTO principles into account such as 
transparency, necessity, simplification and practicalit y, consistency and pred ictability, communication 
and consultation, non-discrimination, due process and cooperation.  Hong Kong, China believed that 
Members could use those principles as building blocks in the course of developing their proposals.   
195. The representative of Canada  said that the Group had got off to a really good star.  Not only 
was there a solid work programme that had been ag reed last week, but there had also been a very 
thorough set of presentations by the other institutio ns working on Trade Facilitation.  Canada had 
always considered Trade Facilitation to be a very im portant topic, and now that Members were in the 
negotiating phase, Canada looked forward to maki ng substantial progress in the coming months.  
Ultimately, what Canada was seeking was an outcome that would provide distinct benefits for all, in 
particular, an outcome that would be truly reflectiv e of the development goals of the Doha Round.  In  TN/TF/M/2 
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 order to achieve such an outcome, Canada would exp ect that the overall effort had to focus on themes 
such as good customs and other trade-related border practices, predictability for the multilateral and 
domestic communities, as well as he lping governments with their domestic reform efforts.  That 
would also require a continued c oherent and targeted approach to  the delivery of trade-related 
technical assistance and capacity-building – one th at would enable all Members to implement the 
outcome of the deliberations.  In that context, Ca nada would be reaching out to various countries and 
groups of countries to better understand their objectiv es, needs and concerns.  Canada's motivation to 
do that work was longstanding.  New and/or improve d rules to facilitate trade held the promise of 
distinct benefits, including faster, predictable a nd efficient customs clearance, as well as transparent 
and predictable procedures.  The bottom line wa s lower business costs and more efficient and 
effective use of government resources.  Canada wa s prepared to work hard including by developing 
proposals to help build the consensus that w ould be necessary to achieve those goals.   
196. The representative of Bangladesh  drew attention to the documents circulated by the 
Secretariat in connection with the meeting.  Under agenda item 2A, the Secretariat, the World Customs Organization, UNCTAD and the World Bank had been invited to make presentations on 
their work in the field of Trade Facilitation.  The Secretariat had provided Members with relevant 
documents on their presentations, which had been useful and timely.  Bangladesh appreciated their 
substantive contributions.   
197. One of the documents circulated by the Secret ariat was the preliminary summary of an APEC 
Seminar on Trade Facilitation held from 8-9 Novemb er 2004 in Bangkok.  APEC was not referred to 
in the agenda of the meeting as one of the presente rs.  Bangladesh was therefore unable to understand 
the reason for circulating the APEC paper at the pr esent the meeting.  At that early stage of the 
negotiations, it would not be advisable for the Secretar iat to circulate any paper that largely reflected 
views of a particular group of WTO Members.  Hi s delegation would appreciate if due note was taken 
of its position and if the Secretariat would act accordingly.   
198. The Chairman
 clarified that the APEC paper had not been circulated by the Secretariat.  It 
also did not have an official document number.  The paper had only been made available upon the 
request of the delegation of Japan.   
199. The representative of Switzerland  held that the continuous increase in trade volumes, trade 
complexity and the speed of trade flows had ma de the need for Trade Facilitation very clear.  
200. Many organizations had worked in the field of  Trade Facilitation for numerous years.  Trade 
Facilitation had long been a subject of action in ma ny fora and organizations, both intergovernmental 
and non-governmental (like the ISO or the ICC).  They were active in the regulatory field as well as in 
the field of technical assistance and capacity building.  In the Negotiating Group, Members should not duplicate the work done in those organizations, but ra ther draw upon their expertise, which would also 
be needed with regards to techni cal assistance.  For a long time, there had been dissent on the role 
WTO had to play in that regard, reaching beyond  the existing provisions on Trade Facilitation.  
Switzerland was satisfied that the 1 August result a llowed for convergence on the view that WTO had 
indeed a strengthened role to play.   
201. There was a deep need to involve all stakeholde rs.  Trade facilitation involved many actors – 
traders, intermediaries, logistics companies, banks, different government  authorities – which all 
needed to be involved for Trade Facilitation to deliver its full benefits.  In the past, those stakeholders 
had too often used different methodologies and tec hnologies to achieve the same end:  facilitate 
business and trade.  Best practices existed which coul d serve as a reference.  But they had not yet been 
fully deployed in many countries.  The appropria te involvement and consultation of all of those 
stakeholders would be key, namely in the process of implementation.  Field experience showed that TN/TF/M/2 
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 communication among stakeholders could not be ov eremphasized.  Many projects needed a second 
start because not everybody con cerned had been involved.   
202. Members had to take advantage of the many ideas put forward since Singapore, such as the 
need to increase transparency and predictability of  procedures, to align and simplify documents, to 
enhance efficiency and speed of customs proce dures and adapt regulations to the dynamics of 
international trade, to facilitate transport and tran sit and to seek electronic integration of information 
and payment flows.  Trade Facilitation measures sh ould also be examined from the view point of 
GATT principles as well as from the more ope rational side of the supply chain.   
203. As decided on 1 August, the results of the nego tiations would have to take fully into account 
the principle of special and differential treatment.  Due to the important differences among developing 
countries with regard to already implemented Trade Facilitation measures, it was necessary to 
acknowledge that it was a huge challenge to transl ate that decision into operational provisions.  
Members would have to rely on creative ideas.  Ne w approaches were required that were tailor-made 
rather than generally applicable across the board.  Countries' own capacities and priorities, together 
with external technical and project support, would determine the individual action plans.  Action plans 
and a monitoring mechanism were indispensable elements of that approach.   
204. Switzerland recognized that the provision of technical assistance and support for capacity 
building was vital for developing countries and LDCs .  In the coming months, Members would have 
to present ideas on how to make best use of bilate ral technical assistance efforts and of such provided 
by international organizations.  It might be necessary to think of some kind of platform for 
cooperation and coordination in capacity building and technical assistance.  Beneficiary countries 
should clearly identify and prioritize their assistance needs.  UN agencies and other relevant 
international organizations should also address that issue in cooperation with the WTO.  Beneficiary 
countries should be proactive in that respect.   
205. The subject of Trade Facilitation had long been  in the pipeline, and tremendous preparatory 
work had been done since Singapore.  Switzerland welcomed the 1 August result as enhanced Trade 
Facilitation brought benefits to all stakeholders in international trade.  Trade liberalization was an 
important tool for development in a system ba sed on predictable rules, openness and lack of 
discrimination.   
206. The representative of New Zealand
 welcomed the launch of negotiations on Trade 
Facilitation.  New Zealand had been  a strong supporter of such nego tiations for many years and was 
committed to ensuring an effective and productive nego tiation on the basis of the modalities agreed in 
July.  As for New Zealand's broad objectives for the negotiations, New Zealand was interested in 
them leading to the development of Trade Fac ilitation measures that would strengthen and improve 
four existing WTO principles of direct relevance to Trade Facilitation, namely, (i) improved transparency, (ii) due process, (iii)  greater certainty of trade, and (iv) minimizing unnecessary restrictions to trade.  Similar and related princi ples had further been mentioned by others, such as 
simplicity or predictability, which we re supported by New Zealand as well.  
207. New Zealand critically depended on trade. It had a real interest in ensuring Trade Facilitation 
outcomes that would assist its exporters to operate mo re effectively and efficiently in the international 
market.  Trade facilitation was also important on the import side.  By cutting costs and simplifying access for imports, it secured cheaper goods for Ne w Zealand's consumers and more competitively 
priced inputs for its domestic industries.   
208. New Zealand was conscious of the work to be done to move the negotiations forward.  It 
supported the educative focus of the present meeti ng and was of the view that, as negotiations 
progressed, educative opportunities would continue to be important.  New Zealand was grateful to the  TN/TF/M/2 
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 international organizations that ha d already given presentations.  They  had done much valuable work 
on quantifying and analyzing the implications of improved Trade Facilitation measures for Members.  
There was now much more reliable and detailed info rmation available, and a much more complete 
diagnostic toolkit, than there had been even at Cancun.   
209. New Zealand agreed that good coordination, particularly between developing countries and 
those organizations would be im portant in facilitating progress in the negotiations and ensuring 
delivery of the appropriate technical assistance a nd capacity building to Members according to their 
specific needs and priorities.  With respect to th e next steps, New Zealand was in the process of 
looking at where best to make a contribution to the Negotiating Group.  In the past, New Zealand had submitted papers on its national expe rience and its domestic attempts  to implement and operationalize 
improved Trade Facilitation measures.  New Zealand hope d that there might be elements in them that 
could be developed further in the new post-July ne gotiating environment.  For example, New Zealand 
had shared ideas on small practical measures such as establishing enquiry points and reducing paper-
flows.  Those and other ideas were ones that coul d be explored further in the context of the 
modalities, taking into account the range of issues cove red in them.  New Zealand was also aware that 
Trade Facilitation spanned a range of activ ities and a number of government agencies and 
stakeholders.  They all had to be involved and their input and interests had to be taken into account, to 
the extent possible, if the negotiations were to move forward.  New Zealand was looking forward to 
moving into the substantive phase of the negotiations next year.   
210. The representative of India
 associated herself with the statement by the Philippines on behalf 
of the Core Group.  Members were now beginning work on Trade Facilitation based on the modalities 
contained in the July framework. The Secretariat compilation G/C/W/434 would be a useful starting 
point for that work which could help to further focus the discussions and add more precision to Members' work on GATT Articles V, VIII and X.  The Work Plan drafted by the Chairman was 
extremely well-balanced and took into account the con cerns of developing countries and the need to 
address them.    
211. Technical assistance was an integral part of the negotiations.  If the Secretariat, in 
collaboration with the other relevant international organizations, could draw up an illustrative check 
list of issues arising from the problems articulated  by participants in the various workshops and 
seminars on GATT Articles V, VIII and X, that coul d be a useful reference point for future work.  
Furthermore, technical assistance also needed to be  slightly re-oriented to provide for more "hands-
on" training, not only for customs officials, but also for other Geneva- or capital-based officials, and it 
should also focus on capacity buildi ng.  The assessment from that technical assistance should also 
focus on necessary provisions to meet the estimated costs, which should be an important part of the technical assistance activities.  India was committe d to engage constructively in the negotiations, 
which had to be a Member-driven process, based on Members' proposals.   
212. The representative of Costa Rica
 said that there had been a good start of the Negotiating 
Group's work which had covered many of the releva nt aspects of the negotiations.  Costa Rica was  
extremely pleased to have been able to begin the negotiations in July.  Trade Facilitation was a key 
element of a country's development policies.  Th e modalities provided the Group with a solid basis for 
a clear framework of principles and obligations which enabled Members, and particularly traders, to participate in a global economy with great certainty , with legal security and efficiency.  As had 
already been mentioned by Bolivia , better access to markets through reduced tariffs was not enough.  
It was also necessary to simplify procedures for e xport and import as they created other obstacles to 
international trade.  Those principles and obligati ons had to be accompanied by actions leading to 
creating greater capacity building and promoting technical cooperation and assistance, taking into 
account the realities and conditions in each country, especially developing ones.  That had been 
clearly outlined in the modalities set up in July.   TN/TF/M/2 
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 213. Trade facilitation should be considered as an ag ent for development, not only as a tool for 
trade.  The objective of the negotiations was to  reach balanced commitments for Members which 
enabled everybody to benefit.  Some of those be nefits could improve im port- and export-related 
procedures.  They did not only benefit larger ente rprises, but also small-and medium-sized ones, as 
well as consumers.  All of them would benef it from reductions in costs and delays, and from 
improvements in the administration of procedures, in  collecting levies and fees and in improving the 
investment climate.   
214. Costa Rica believed that it was important to stre ngthen technical assistance in that area which 
was positive for developing countries.  Costa Rica al so welcomed the fact that developed countries 
had offered greater commitment in the modalities to strengthen technical assistance in order to help 
developing countries comply with the commitments.   Costa Rica was dedi cated to the negotiating 
process and hoped that future contri butions would allow the improvemen t and clarification of Articles 
V, VIII and X of the GATT.  As mentioned by Hong  Kong, China, it was important that the process 
continued with concrete proposals enabling Members to  deal with certain elements of the modalities, 
especially those related to technical assistance, c ooperation with other intern ational organizations, and 
coherence.  Efficiency, simplification, transp arency and cooperation were all important.   
215. The representative of Norway
 said that, after several years of discussions in the Council for 
Trade in Goods on Articles V, VIII and X, and on the need for techni cal assistance and capacity 
building, Members had agreed in July to start ne gotiations based on the modalities set out in Annex D 
of the July package.  That was the start of a new process where Members should clarify and improve relevant aspects of the three GATT Articles with th e aim to further expediting the movement, release 
and clearance of goods.  Furthermore, Members had also decided to enhance technical assistance and 
capacity building in the area.   
216. Members had agreed on the adoption of a Work  Plan and schedule of meetings for 2004.  
That was the first step of a process that would lead  to rules for the benefit of everyone, developing 
and least-developed countries alike, importers a nd exporters.  The process ahead was admittedly 
complex and perhaps difficult.  Norway was aware that some Members had a longer way to go than 
others, that their trade flows varied, the size of their economies was different, the level of 
development was not the same with the resources – both economical and human – being modest for 
some Members. Norway also knew that the traded  goods were not the same and that the mode of 
transport was different.  Despite those differe nces, Norway was convinced that everyone had 
something to gain from the negotiations, and if th e trading community could trade more efficiently, 
there were major economic gains for everyone.  Sm all-and medium-sized enterprises would benefit in 
particular from a more predictable and transparent trading environment.   
217. The fact that Members' levels of developmen t varied was fully recognized in the modalities 
for the negotiations.  The need for technical assist ance and capacity building was described, as well as 
the one for special and differential treatment.  Members were all aware that rules without proper 
implementation had no value, and that technical assistance and capacity building were therefore 
necessary.   
218. Norway knew that several projects had already been carried out or were going on in 
UNCTAD, the World Bank, the World Customs Organization, as well as in the OECD, which 
provided very useful input.  The presentation by the World Bank had revealed that the Bank would be 
involved in nearly fifty projects with Trade Fac ilitation components in the fiscal years 2004-2006, a 
considerable extension of commitments compared to  previous years.  Also, within the WTO, in a 
more modest form, the new situation had been re flected in the budget for next year, with more 
resources being allocated to the area.  Norway ha d also heard from the WCO that it was developing 
tools to help countries better assess th eir Trade Facilitation needs.    TN/TF/M/2 
 Page 43 
 
 
 219. The educational part of the meeting had been an  important step, and should continue.  In the 
weeks and months ahead, Members should engage in a dialogue about the complex issues they needed 
to solve in the negotiations.  If Members all engaged in such a dialogue they would reach a result that 
would benefit everyone.  At the next meeting in February 2005, Norway looked forward to an in-
depth discussion of the relevant aspects as set out  in Annex D and the approved Work Plan.   
220. The representative of Pakistan  said that there were as many views on what was meant by 
Trade Facilitation as there were delegates in the r oom.  To start the negotiations on Trade Facilitation, 
the first and foremost task was to have a list of a ll the areas that needed to be negotiated.  For that, 
guidance and help could be sought from the Re vised Kyoto Convention, and from work done by 
APEC and UNCTAD, and others.  Once Members had identified the areas that needed to be 
negotiated, they could proceed with assessing their respective needs and priorities and – 
simultaneously – the concerns of developing and l east-developed countries.  Once those things were 
settled, work could progress smoothly.   
221. With respect to technical assistance and capacity  building, reference had been made to them 
in Annex D on many occasions.  Two different connot ations were involved – one with respect to the 
participation in the negotiations and a second one as regards the implementation of their results.  The 
presentations made by the various international organizations had s hown that there were many Trade 
Facilitation projects going on.  There was a need for coordinated and coherent work in the area.  If 
some agencies, preferably the Secretariat, the Global Fund and the Negotiating Group on Trade 
Facilitation, could be given the lead role in iden tifying where technical assistance was required, to 
what extent, and which agencies could provide it, th at might smooth the pro cess.  The need for that 
was further strengthened by paragr aph 7's reference to review the effectiveness of the assistance and 
support provided by the donor agencies or  by international organizations.   
222. The representative of China  said that, on the whole, the Chinese delegation felt comfortable 
about the Work Plan.  It was balanced and compre hensive and China could go along with it.  As for 
the elements of substance, China was of the view  that Trade Facilitation acclimated the development 
trend of economy globalization and acc orded the development goal of the multilateral trading system.  
Therefore, the Chinese delegation firmly supp orted the process of advancing and expediting 
negotiations on Trade Facilitation.  The definition of Trade Facilitation was to simplify unnecessary 
procedures in customs clearance.  Substantial ma nagement adopted by each Member due to normal 
trade practice should not be unreasonably affected or  changed.  Trade facilitation aimed to simplify 
unnecessary trade procedures, publicize trading system information in an open and transparent way, 
collect fees rationally, lower costs, shorten time fo r customs clearance, and improve trade efficiency.   
223. Scope, modalities and objectives of the negotiations s hould be clarified first.  In light of the 
mandate of paragraph 27 of  the Doha Ministerial Declaration and Annex D of the July package, China 
was of the view that the scope should be define d as being the clarification and improvement of 
Articles V, VIII and X of GATT 1994, which in cluded information provision, consultation 
mechanism, review and appeal procedures, doc umentation requirements, customs procedures, 
cooperation between border agencies, transit procedur es, non-discriminatory requirements etc.  China 
believed that the objectives of the negotiations we re to simplify and rationalize trade procedures, 
lower trade costs, improve trade efficiency, creat e more open and transparent trade procedures and 
provide a non-discriminatory and predictable basis for international trade.  The result of the 
negotiations should not affect each Member's trade practice.  All indispensable works, procedures and 
management systems should be im plemented integrally.  As for the modalities, China believed that 
the negotiations should proceed in accordance with  the modalities set out in Annex D of the July 
package in order to ensure inte gral and efficient results.   
224. During recent years, China had made remarkable  progress in Trade Facilitation, introducing a 
mechanism called Integrated Clearance System, a sy stem for the simplification of procedures and the TN/TF/M/2 
Page 44  
 
 reduction of costs, which responded to the growth in  trade over time.  In doing so, China had found 
itself to be still short of necessary technical suppo rt in the areas of infrastructure support and IT 
personnel.  There was a need for enhancing capacity building with regard to various aspects.  China 
hoped that those issues would be progressively solv ed as negotiations proceeded, and that they would 
benefit all Members and facilitate thei r future international trade.   
225. The representative of Sri Lanka
 said that he had paid particular attention to one of the slides 
of the World Bank presentation which stated that customs and broad oriented formalities were 
increasingly considered as a more significant barrier  than tariffs.  The World Bank had also presented 
their important website.  In exploring that site, he had come across particular research done by a 
researcher from the United States, which attempted to assess the trade restrictiveness of the various 
border measures.  Interestingly, cumbersome procedures in the customs and border clearance area had 
been classified as being most trade restrictive.  The Negotiating Group could contribute to addressing 
those trade restrictive aspects by simp lifying and rationalizing procedures.   
226. Sri Lanka had some experience in introduc ing Trade Facilitation measures, like the 
ASYCUDA programme, and clearly saw the benef its.  Trade facilitation could bring immense 
benefits exceeding the costs to the trade and th e economy as a whole and could contribute to poverty 
reduction.  However, Sri Lanka shared the view that technical assistance should be an integral part of 
the negotiations.  The need for assi stance in that area went beyond the traditional and conventional 
aspects of technical assistance.  Modernization a nd application of technol ogy were required.  
Developing countries were sometimes lagging behind in  those areas.  An extra effort was needed in 
identifying specific needs of those countries.  Sri Lanka looked forward to engaging in the discussion 
focussing on such technical assistance needs.   
227. The representative of Turkey  stated that the use of information technology was one of the 
most important revolutions trade-related administ rations had ever witnessed.  The development of 
new technologies and of telecommunications infrastru cture had helped trade-related administrations 
to lower the costs of receiving and disseminating information.  Performing procedures in an electronic 
environment challenged national and international coordination if combined with improvements in the 
legislative and structural pillars of the organi zation.  Facilitation of trade required fundamental 
changes in trade-related legislation, particularly cu stoms legislation. All legislation that did not meet 
recent requirements caused loss of time for both traders and customs organizations.  Implementing legislation properly had been a main driving force for enhancing the existing administrative 
capacities.  The goal of acceding to the European Union provided all public sectors in Turkey with the 
necessary political will for such action.   
228. Effective capacity building required an accurate  diagnostic and analysis of country-specific 
needs.  With that in mind, a customs modernizati on project had been undertaken in Turkey in parallel 
with legislative reforms.  From that point on, the focus of the modernization efforts had been on 
modifying customs legislation and procedures acco rding to international standards, such as the 
Revised Kyoto Convention, the development and im plementation of computer systems and the re-
organization of customs administration.   
229. Turkey strongly supported the idea of using WC O papers and instruments as a starting point 
to advance the talks.  As Turkey had understood from the presentations and earlier interventions, 
technical infrastructure was useful for Trade Facilitation, but not indi spensable to start the process of 
ensuring transparency and predicta bility, working on the standardization of documents or struggling 
against corruption.  The only element required was the will to do it.  No computers were necessary to 
do so.  But, at a certain point where existing resour ces would be insufficient, there would be need for 
infrastructural and institutional transformation.  At that point, modernized work flows and technical equipment would be somewhat inevitable.  The only thing limiting the Trade Facilitation were the 
security and fraud-control concerns.  When iden tifying Trade Facilitation needs and priorities,  TN/TF/M/2 
 Page 45 
 
 
 reference should be made to concerns in the areas of  security and fraud. Capacity defined the limits of 
elasticity of an administration and established r oom for waving some traditional compliance systems 
such as physical checks or special documentation.  Security and fraud concerns should be the sole 
limiting elements for the current talks.  Turkey prop osed to discuss security and fraud concerns in the 
forthcoming sessions when defining Trade Facilitation needs and priorities.   
230. The representative of Ecuador  noted that the information sessions had provided delegations 
with the necessary background to have the negotiati ons positioned in line with  Annex D and within 
the concept of the Single Undertaking.  The suppor t by the Secretariat in compiling documents and 
ideas was of particular importance.  Ecuador suppor ted the principles on which the negotiations were 
based, where technical assistance was crucial as well as innovative forms of capacity building adapted 
to each country's needs and  realities.    
231. Trade facilitation was a subject which would bear important results in the Development 
Round.  Coordination of efforts and programmes by va rious bodies and coherence of policies applied 
in developing countries were particularly important.   
232. The representative of Indonesia  noted that the educational and stock-taking process had been 
very useful.  With respect to the matters under negotiation, Indonesia supported the statement made 
by the Philippines, and encouraged all Members to engage constructively in the process based on the 
modalities stipulated in Annex D of the July package.   
233. The representative of Cuba  said that work should proceed on the basis of the proposed Work 
Plan.  Cuba agreed that it should be a Member-dri ven process based on concrete proposals.  It should 
be preceded by an assessment of the needs and prior ities of the Members of an organization where the 
development dimension was a c onstant reference point for de liberations and decisions.   
234. Cuba recognized the major role that technical assistance could play in that stage as well as the 
importance of contributions and inputs from other in ternational organizations to the negotiations.  The 
Cuban delegation wanted to emphasize  the importance of special and di fferential treatment to ensure a 
positive balance for all Members.  With that aim in  mind, special treatment should not be conceived 
solely in terms of timeframes to meet obligatio ns.  It  should also ensure trade advantages  and room 
for Members with greater difficulties to fully fit in to the multilateral trading dimension and to achieve 
a positive balance.   
235. To have a successful outcome of the negotiations , it was first necessary to avoid gaps in the 
interpretation of Articles V, VIII and X of the GA TT, which were currently present, and to agree on 
the definition and the scope of Trade Facilitation, as well as on the cost-benefit impact of multilateral 
obligations.  It was also necessary to strengthen the key pillars of the WTO, such as the principle of 
non-discrimination.   
236. The representative of Korea  said that the meeting had provided a good opportunity to 
introduce ongoing projects and progress of work by re levant international organizations especially in 
the area of customs procedures.  Korea was enco uraged by the WTO Secretariat's plan to hold 
regional seminars and workshops the following year .  That would offer good opportunities for many 
developing countries to assess their Trade Facilita tion needs and priorities.  Korea remained 
committed to the negotiations process and would enga ge in that Member-driven process by submitting 
proposals on improving and clarifying relevant GATT Articles and by sharing its national experience 
while at the same time bearing in mind the concerns expressed by developing countries.    
237. The representative of Brazil  said that he had learned from th e presentations the other day that 
the term "Trade Facilitation" was used as if it meant one thing whereas it actually had several 
different meanings.  When negotiating a project on Trade Facilitation with one country, the World TN/TF/M/2 
Page 46  
 
 Bank could take all its needs into account, examine all relevant circumstances, adapt procedures to the 
requirements of that particular country and pr ovide a loan which would directly go to the 
administration involved.  In exchange, it was possi ble to devise some performance requirements such 
as dropping the average number of days spent in cu stoms clearance by a certain percentage.    
238. What could be done in the WTO was different.  The WTO was a rules organization, with 
those rules having to apply in a horizontal manner to the extent possible.  It was not possible to take 
into consideration all the needs and specific requi rements of each country.  What one had for the time 
being were rules that required things like not to have unreasonable delays, or not to impose excessive 
fees.  What Members could do with that was to bring those very general expressions to something 
more concrete and see what that could mean.  Th e unreasonable delay was perhaps due to a lack of 
harmonization of documents.  In that case, Members could perhaps reach agreement to look at some 
model adopted elsewhere in the context of the ne gotiations, just as Members had done in the areas of 
SPS and TBT, where they had referred to what had b een done in other organizations.  In the WTO, 
one could not expect to go into the level of de tails applied by the World Bank or some other 
organizations when negotiating a project.   
239. As UNCTAD had explained, even an automated sy stem for customs data had to be adapted to 
the individual requirement of each coun try.  It would be very difficu lt to try to sort out in the WTO 
what exactly would be the kinds of rules that would apply to all Members.  That had other 
implications as well.  When saying that Trade F acilitation would benefit ev erybody, one might refer 
to the kind of Trade Facilitation carried out in so me other organizations.  What Members had done in 
the WTO on Trade Facilitation had to do with mark et access and liberalization, and with not undoing 
in customs what one had agreed on in the market ac cess negotiations.  Therefore,  one could say that it 
was beneficial in general terms, but one could not say that it benefited everybody exactly at the same level.  That was something Members would have to look into.   
240. With regard to the Work Plan, one had to ta ke an opposite view.  It would not be very 
productive if Members spent a lot of time trying to establish be forehand what their needs and 
priorities were as they would differ from country to  country and would have to be adapted to the 
circumstances of each Member.  What Members needed as soon as possible were concrete proposals 
on the clarification of GATT Articles V, VIII and X.   Then those proposals should be examined from 
the perspective of all the elements contained in the Work Plan, looking at questions like to what 
extent was special and differential treatment require d, how would the suggested measures fit the needs 
and priorities of all Members, what had to be done in term s of technical assistance, and what had been 
done with other relevant interna tional organizations.  Members should be clear as to what the object 
of the work was, and what the task at hand was to make progress.  A Work Plan had already been 
adopted.  The sooner one could get into a concrete discussion of proposals related to Articles V, VIII 
and X, the better.   
241. The representative of the European Communities
 noted that his delegation was very pleased 
that the negotiations were finally underway and on the basis of an explicit consensus.  That built very 
well for the future negotiating process.  Obviously , there would be differences in the importance 
attached to the negotiations by different Members.   There would be different needs, priorities and 
areas of concern.  But it was very clear that it was not a north-south issue.  It was not one with winners and losers but one where everybody could de rive some benefits if one got it right.    
242. There had been quite a bit of discussion on what  was meant by Trade Facilitation.  Brazil had 
raised the issue in a very coherent way.  What the EC saw as Trade Facilitation was stated in the 
mandate of 1 August.  That was the basis and the starting point that defined the scope of work on 
Trade Facilitation in the WTO.  There was less need to concern oneself with what was Trade 
Facilitation than with why one was doing it.  For th e Communities, the purpose was to arrive at an 
outcome that would make life easier for traders.  That meant reducing costs, delays and the  TN/TF/M/2 
 Page 47 
 
 
 bureaucratic procedures all traders and, in partic ular, SMEs, were facing on a day-to-day basis around 
the world.  It would be wise to test all ideas and all proposals in the coming weeks or months against the criterion of whether they made life easier for traders.   
243. The discussions at the present  meeting had already given a good basis on which to focus 
work in the coming months.  The EC drew two or th ree initial, preliminary conclusions from it.  First, 
there was clearly scope for updati ng the three GATT Articles referred to in the negotiating mandate.  
Secondly, it was very clear that some very fundamen tal GATT principles did not apply either at all, or 
in full, to those three GATT Articles, such as th e principles of transparency, non-discrimination, 
proportionality, use of international standards and sp ecial and differential treatment.  Those were all 
fundamental GATT concepts which were not really fu lly reflected in many aspects of Articles V, VIII 
and X of the GATT.  The third point was that there should be scope for updating the GATT 
provisions and taking action in a number of areas that could be introduced relatively easily and that did not imply any, or no, significant resources.  Measures to align procedures with existing international standards, procedures to reduce th e amount of paperwork required for presentation at 
borders, coordination between customs authorities a nd the reduction, publication and rationalization 
of fees charged for various kinds of customs in terventions etc. were measures which could be 
achieved relatively easily.  They did not imply any real costs.  The many notifications in the NAMA Group on non-tariff barriers relating to customs pr ocedures and fees and formalities indicated that 
there was  quite a lot of interest from many Me mbers from all sides to see some improvements in 
those areas.    
244. The present discussion was of a more general nature with the Group not getting into the 
details of the various provisions  and not making specific proposals.  The European Communities 
would soon bring forward some specific proposal s in respect of the GATT Articles Members were 
asked to clarify and improve.  They would be based on previous submissions that Brussels, and others, had made to the WTO and would focus on areas which were relatively obvious, relatively easy 
to understand and which could be ach ieved at relatively little cost.   
245. His delegation was pleased with the way in which the Work Plan had been elaborated.  As the 
Group moved into a more substantive phase of work next year, Members would need to find a way to 
move from the more general to the more specific.  He agreed with Brazil that Members had to define 
better the outer parameters of what they were ne gotiating with reference to the mandate, the three 
GATT Articles, and the other very important elemen ts of that text.  As soon as delegations could 
come forward with more specific ideas which woul d allow the Group to focus the discussion, it would 
obviously be easier to look at the merits of clarifying and improving the three GATT Articles, and, on 
that basis, at what it entailed in terms of special  and differential treatment, technical assistance, cost 
implications, the particular needs of the least-dev eloped countries etc.  Members would have to use a 
starting point based on specific proposals, as Brazil had rightly suggested.   
246. With respect to trade-related assistance a nd capacity-building support, the discussions had 
clearly underlined that they were fundamental in  the area of Trade Facilitation.  No delegation was 
more committed to the provision of assistance and aid than the European Community and its Member 
States.  But one had to be rather clear about the WTO's role in that area, and about what belonged 
more to the other international organizations who we re more directly concerned with the delivery of 
development aid in a broader sense.  In the WT O framework, there was obviously a role for the 
Secretariat and other organizations to particip ate in the pedagogical process.  Workshops and 
seminars aimed at helping delega tions better understand the implicati ons of various Trade Facilitation 
proposals that might be made in the WTO.  But with respect to the implementation of any future WTO provisions, the capacity building and aid effort would be beyond the WTO's mandate and capabilities.  That was more the work of other inte rnational organizations who needed to work in a 
much more coherent way. And that was understood by them. There was also an important role for 
development aid in a broader sense for infrastructure,  development etc. which had very little to do TN/TF/M/2 
Page 48  
 
 with the WTO agenda.  With or without any futu re provisions on Trade Facilitation, there would be 
the provision of development aid in a broader sense to build up infrastructure.  That aid was not a specific focal point for WTO negotiations, but the kind of support provided by  major bilateral donors 
and the World Bank, helping to build up countries' infrastructure.  That support was already taking 
place, it had been a priority for many in recent y ears and would continue to be a priority in 
development aid, with or without the WTO pr ocess.  As Members moved along in the Trade 
Facilitation discussions, it was important to have a fairly clear idea about what kind of technical 
assistance and capacity building work was strictly w ithin the purview of the WTO as an institution, 
and the Negotiating Group in particular, and what ne eded to take place and be carried out in parallel 
in other international organizations.   
247. The representative of the United States
 said that her delegation was delighted to begin 
negotiations on Trade Facilitation and to participate in  the first substantive meeting of the Negotiating 
Group.  The presentations that had been made would provide a helpful input as Members moved forward early next year to negotiate clarificati ons and improvements to GATT Articles V, VIII and X 
and to meet the overall mandate of the negotiati ng modalities.  The negotiations offered a unique 
opportunity for every Member to meet a challenge that  was increasingly an element of participating in 
the world trading system.  The negotiations were fo r all Members both in terms of their importing and 
exporting capacities.  Everybody was living in an  era of instant communication and continually 
increasing efficiencies in the movement of goods.  Every Member's economic output and, in particular, the operation of their small enterpri ses would be improved by more openness in trade 
transactions, procedures or, more directly, by taki ng a positive systemic approach to improvement.  
One of the important results should be that a sudde n unavailability of needed inputs for manufacturing 
could not be attributable to their being held  for unduly long periods at the borders.   
248. The United States would also like to emphasize that they did not see complex negotiations.  
Some of the kinds of commitments they would envi sage were greater transparency measures, specific 
provisions for procedural fairness in administrativ e and traditional review pr ocedures, provisions to 
help provide rapid release of goods, and provisions fo r expedited treatment of express shipments.  The 
US delegation was already aware of the keen inte rest of landlocked countries in ensuring that GATT 
Article V relating to the treatment of goods  in transit was made more robust.   
249. The United States had started a robust domestic c onsultation process with its traders and other 
interested stakeholders.  They had also managed to begin to engage some of their developed and 
developing trading partners in the WTO, and hoped to do more.  The United States had began 
exchanging views on what they envisioned for the negotiations and hoped to have a dialog in which 
they could maintain those kinds of communications which would be an important element of ensuring 
a full and shared understanding as they moved ahead in  the negotiations.  Through such efforts, they 
could also ensure a full understanding of the indi vidual needs and challenges of each Member.   
250. Already from those early exchanges, and from th e interventions at the present meeting, the 
United States sensed a lot of shared interest in obj ectives and in ways of meeting them.  From that, 
they were optimistic for steady progress with ever yone participating.  Like  Brazil and others, the 
United States saw the negotiations as a Member-d riven process and was ready to soon begin with 
concrete proposals along the lines discussed by several  Members, taking into account all the elements 
of the modalities, including issues such as cost and what kind of technical assistance might be necessary.  The need for coordination with the inte rnational donors and providers was important and 
the Unites States looked forward to a dialog as Members drew from experiences and improved their 
understanding and how to achieve that.    
251. There was a high potential for the gains from those negotiations to be in the form of 
commitments that provided for the transparency, effi ciency, stability and certain ty needed to ensure  TN/TF/M/2 
 Page 49 
 
 
 growth in trade flows and increased investment.  For each Member at every level of development, 
there was an opportunity in the negotiations for positive results.   
252. The representative of Egypt  shared the views of Brazil and the United States on what should 
be the aim of the negotiations.  It  should be a simple process of agr eeing on some general principles 
and understandings without getting into detailed technical issues.  It was important to have that  kind 
of understanding among all Members in the beginni ng of the negotiations, so that the specific 
submissions would then be framed accordingly instead  of getting into an endless debate on that matter 
each time. If that view was shared by everybody, it would make life easier.  Egypt had been triggered 
to make that statement by hearing some delegations  suggest that, besides principles, they wanted to 
see specific measures, with some even saying they  wanted to have WCO agreements like the Kyoto 
Convention as a starting point.    
253. The representative of Paraguay  noted that Trade Facilitation was extremely important to all 
Members, but especially to countries such as Paragua y, who faced obstacles and challenges that were 
more serious than others due to their particular ge ographic situation.  Bolivia had already alluded to 
the special problems encountered by landlocked coun tries in that regard. For landlocked countries, 
seeking sustainable development and progress meant ha ving to seek mechanisms to allow for their 
more efficient integration into the multilateral trad ing system.  To that end, they needed technical 
assistance to improve their infrastructure, build cap acity and attract foreign direct investment. In 
addition, special and differential treatment was f undamental to allow them to compete on the same 
level playing field in the multilateral system.   
254. The Negotiating Group took note  of the statements made.  
C. AD HOC ATTENDANCE OF RELEVANT INTERNATIONAL ORGANIZATIONS , INCLUDING THE 
IMF,  OECD,  UNCTAD,  WCO  AND THE WORLD BANK, AT THE NEXT MEETING OF THE 
NEGOTIATING GROUP  
255. The Chairman  said that the Group's Work Plan provided for relevant international 
organizations to be invited on an ad hoc  basis.  The current meeting had underlined the benefits of 
having them on board. 
256. He asked Members whether they would once agai n invite representatives of the IMF, OECD, 
UNCTAD, WCO and the World Bank to attend the Group's next meeting on such basis. 
257. It was so agreed .   
D. OTHER BUSINESS  
258. The representative of Chile  said that, since APEC was a forum in which a number of WTO 
Members participated and where a number of practic es had been developed which could be useful for 
the negotiations, it would be useful to inform the Group of the part of a declaration APEC Ministers 
had adopted at a recent meeting that related to Trade Facilitation.   
259. On 17 and 18 November in Santiago, APEC Ministers had met and had drawn up a joint 
declaration on a number aspects.  One of those was to reaffirm their commitment to liberalization 
within the multilateral trading system.  In that c ontext, APEC Ministers welcomed the launching of 
negotiations on Trade Facilitation within the WTO.  Ministers recognized the important role played 
by the issue of Trade Facilitation in order to maximize  the benefits to be gained from the liberalization 
of markets.  In that context, reference had been  made to the vast experience of APEC in Trade 
Facilitation and the importance of sharing experien ces with other Members of the WTO, taking into 
account the principle of special and differentia l treatment and the importance of introducing TN/TF/M/2 
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 multilateral rules to increase certainty, reducing costs and delays and improving the competitiveness 
in the trading conditions.   
260. With regard to capacity building, Ministers r eaffirmed the importance of promoting progress 
in the Doha Round of negotiations.  They appealed for an improvement and an increase in efforts to 
help capacity building in developing countries, espec ially where it could be seen that APEC provided 
better added value.  Trade facilitation was one of the areas where the Declaration contained 
commitments to organize seminars and workshops on  the subject.  Chile was committed to organizing 
a roundtable on Trade Facilitation in Geneva in the first months of 2005. 
261. The Negotiating Group took note
 of the statement made.  
262. The Chairman  raised the issue of the Group's next meeting. Recalling the list of dates he had 
communicated to the Group at its last session, he suggested to hold it on the first days indicated 
therein, i.e. on 7 and 9 of February 2005.    
263. It was so agreed .  
264. The meeting was closed . 
 
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