WORLD TRADE  
ORGANIZATION  TN/TF/W/63 
19 September 2005 
 (05-4108) 
Negotiating Group on Trade Facilitation Original:   English 
 
 
 
 
COMMUNICATION FROM PAKISTAN AND SWITZERLAND 
ON DEVELOPMENT-RELATED ISSUES IN TRADE FACILITATION 
  
 The following communication, dated 16 Septem ber 2005, from the Delegations of Pakistan 
and Switzerland, is being circulated in advance of the Negotiating Group mee ting of 19-20 September 
2005. 
_______________ 
 
 The objective of this communication is to contribute to the challenging opportunity of 
Annex D to develop new forms of collaborati on to implementing WTO rights and obligations 
supportive of development. This contribution focuses on development-related issues in Annex D. It is 
a living document that will evolve as negotiations proceed and the understanding of the issue deepens. 
Hence, this document does not reflect final views on this matter. Therefore, the sponsors reserve the 
right to revise, supplement and/or withdraw any of the ideas set out herein. 
 
I. INTRODUCTION AND BACKGROUND 
1. Many developing countries faced difficulties to  implement the agreements of the Uruguay 
Round that established rules for "behind-the-border"  issues or for non-tariff "technical" obstacles at 
the border. When Annex D was drafted, these co ncerns were on the top of the minds of the 
negotiators. This contribution tries to provide  some operational elements to address these 
shortcomings. It builds on proposals by other delegations
1 on development-related issues. 
2. Paragraph 2 of Annex D contains the main cha llenges that the negotiators will have to deal 
with:  
• Members recognise that special and differentia l treatment should extend beyond the granting 
of traditional transition periods fo r implementing commitments; and  
 
• in particular, the extent and the timing of ente ring into commitments shall be related to the 
implementation capacities of developi ng and least-developed countries. 
 
3. As we all know, large differences exist among developing countries regarding trade 
facilitation measures already implemented, impl ementation capacities, and the role of trade 
facilitation in the country's development prioriti es. Overcoming these differences requires tailor-made 
and step-by-step solutions. The challenge is to provide enough flexibility for individual Members to 
define their own pace and extent of development, while simultaneously ensuring that collectively 
we set ambitious targets for the longer term . 
                                                      
1 Namely TN/TF/W/41 by a number of Latin American countries, part II pointing to the 
interrelationship between the elements of Annex D; TN/TF/W/29 by China and Pakistan, proposing operational steps of work for the assessment of Members' needs and priorities; and TN/TF/W/56 by the African Group, 
focusing on technical assistance and capacity building (TA&CB) during and beyond the negotiations. TN/TF/W/63 
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 4. Further, paragraph 2 takes into account the view s of those countries, which only agreed to the 
modalities with the understanding that assuming oblig ations under the agreem ent would go hand-in-
hand with firm commitments for provision of TA&CB. Therefore, a specific mechanism has to be put 
in place in order to strengthen the link between  negotiation and implementation of any future 
obligations and the provision of  TA&CB. Essentially, such a mechanism should overcome the major 
shortcomings of technical agreements from the Ur uguay Round with regard to their implementation. 
These shortcomings can be summarized in four points: lack of adequate prior assessment of the (cost) implications; poorly defined tran sition periods; insufficient or inadequate resources to back up 
institutional adjustment; and, finally, lack of appr opriate monitoring and review of government action. 
5. Such a mechanism has to be transparent and predictable . It has to accommodate 
expectations and concerns of the trading commun ity (ambitious outcome), of developing, especially 
the landlocked and least-developed countries (lacking administrative and institutional capabilities) as 
well as of the donor communities (accountability to effectively use ODA). 
II. SOME ESSENTIAL STEPS 
6. One of the key messages of Annex D is that  Trade Facilitation obligations would become 
effective for a country when, in the view of the WTO Members, the country has acquired the capacity 
to administer efficiently the rules. Any measures will become binding obligations once the capacity to 
implement has been achieved. Part C of this pape r proposes elements of a mechanism that strives to 
operationalise this objective. The following three elements would complement this operational 
mechanism: 
A. A
N INVENTORY OF TRADE FACILITATION MEASURES  
7. Members agreed in November 2004 that no speci fic work program would be established for 
the Negotiating Group but that the process would be dr iven by Members' contributions. As of end of 
July 2005, 40 submissions relating to Articles X, VIII and V have been made. These submissions 
cover a large range of measures to clarify and incr ease the effectiveness of the mentioned articles. It 
can be expected that these contributions cover the ma jority of technical issu es. The WTO Secretariat's 
compilation document TN/TF/W/43 and subsequent revisions provides a good basis for such an 
inventory.  
8. The contribution by the African Group TN/TF/W/56 suggests further support for clarification 
and educative process, including training of customs officials, with respect to the measures contained 
in the compilation document related to GATT Articl es V, VIII and X. We welcome this proposal and 
encourage Members and relevant international organiza tions to contribute to this educational process. 
We also encourage proponents  to voice their specific interests in the NGTF and bilaterally. 
B. ASSESSMENT OF THE CURRENT SITUATION (NEEDS AND PRIORITIES ) 
9. Undertaking an assessment of the current situation vis-à-vis  trade facilitation and the future 
needs and priorities is necessary for each Member so that it can then define which technical measures 
under negotiation it can implement and in what ti meframe.  Where do countries currently stand in 
trade facilitation? What gaps exist between groun d facilities and proposed co mmitments? We tend to 
agree with China and Pakistan2, as well as with a number of Latin American countries3, which see this 
assessment exercise as a continuous process that has to accompany the negotiations.  
                                                      
2 TN/TF/W/29. 
3 TN/TF/W/41.  TN/TF/W/63 
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 10. International organizations such as the WC O, the WB and UNCTAD have already existing 
assessment tools. The difficulty with these tools is  that they are not specifically designed for the 
measures of trade facilitation being negotiated at pr esent, but look at trade facilitation more broadly. 
The inventory of trade facilitation measures should help to further focus and thereby simplify these 
tools. Members should not devote too much time in debating the necessity of such a new synthesized 
tool but rather adapt the content of existing to ols to the measures compiled in the inventory. 
11. Like other Members that have made proposals on assessment, we believe that each Member 
needs to undertake a thorough self-assessment.  
12. Complementing the picture of the assessment of Members' needs and priorities, Members 
should also get a clearer idea on ongoing and planned TA&CB and infrastructure-financing 
activities  related to the inventory of trade facilitation measures. 
13. Indeed, an impressive number of projects are ongoing or have been implemented in trade 
facilitation. At the same time, the total amount of funding for trade facilitation is increasing as a result 
of the Doha Development Round. A compilation of  these activities will allow for a proper evaluation 
of the TA&CB and infrastructure financing alrea dy provided and further required to implement the 
obligations undertaken under the present negotiations based upon the potential gaps identified through 
the self assessment. Because this needs to be accurate and done on a country-by-country basis, we 
suggest that the recipient Members make this compilation. OECD-DAC has recently launched an 
initiative, supported by Switzerland amongst others, to  contribute to the establishment of an inventory 
of projects undertaken for trade facilitation. The out come of this study should complement the self-
assessment made by the recipient countries. 
C. SEQUENCING OF MEASURES  
14. Determining the sequencing and interrelationship of the techni cal measures being negotiated 
is equally essential.  Indeed, sometimes a combination of measures allows to reap real benefits on the 
ground. Also, some advanced measures may require the prior implementation of other basic measures. 
Experienced international organizati ons could be of valuable support to Members by assisting them to 
organize these interrelationshi ps and their sequencing. 
15. It is our assessment that the measures enum erated in the inventory of trade facilitation 
measures4 are of a different nature: such that would not require investments in expensive 
infrastructure but primarily require administrative – although sometimes politically not easy to implement – actions and such that are increasi ngly demanding, both in terms of resources and 
implementation capacities. Members should not preclude devoting different treatment to these two 
categories of measures in a final Text on trade facilitation. As a starting point, Members could 
individually classify the measures contained in th e Secretariat's compilation document according to 
the matrix provided by the WB/WCO at the July 20 05 session, annexed to this document (see Annex). 
III. A POSSIBLE MECHANISM TO RELATE TA&CB AND FINANCING TO REFORM 
16. A basic requirement for this mechanism is that it is predictable and transparent, and to quote 
from TN/TF/W/56: "such mechanism s hould ensure that the needs and pr iorities with respect to trade 
facilitation … are addressed effectively; that availa ble resources will be efficiently used; and that 
there will be long-term sustainability of technical assistance programmes." 
 
                                                     
 
4 TN/TF/W/43 and subsequent revisions. TN/TF/W/63 
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 17. This mechanism could comprise a set of components: 
 1. action plans containing obligations, implementation periods and required means; 
 2. pledging mechanism for TA&CB and funding;  3. multiple channels to provide TA&CB and funding  4. WTO Trade Facilitation Committee (TFC) to endorse Members' obligations (TF  
  measures) and commitments (TA&CB and funding); and 
 5. multilateral endorsement of  implementation capacities. 
 
1. Action Plan Development and S&D Definition 
18. First, in-depth gap analysis comprising (a) the review of already existing measures to comply 
with the rule; (b) the review of institutional, hum an and financial capacities to develop actions to 
comply with the rule; and (c) assessment of techni cal, financial and human resources needed to fill the 
gap. 
19. Second, based upon the analysis above, project definition for each action required, including 
results, activities, co-financing share, additional resources and time span required. There could be 
some interest for the Member to cluster such actions  into implementation packages. The result of this 
second step is a conditional action plan by the Member. 
20. To draw such action plans, some Members may require technical assistance.
5 
21. Once the conditional action plans are comp leted, we see three possibilities:  
 (i) this Member submits its proposal to the TFC so that Members can get notice of this 
  Member's conditional action plan and then engage into negotiations with interested 
  donors and executing agencies; or  
  (iii) this Member submits its conditional action plan to ad hoc  maybe regionally  
  organized group(s) of independent and in ternationally recognized experts (some kind 
  of technical committee) in order to get a second opinion and objective advice and 
  then does (i) or (iii); or 
  (iii) this Member directly enters into discussions with potential donors and executing 
agencies to match the assessed need for TA&CB and/or financing. Hence, the use of 
the services of these experts or tec hnical committee is purely optional. 
 
22. In all cases, the Member will have to submit its  action plans to the WT O Membership through 
the TFC (see point 4.). 
2. Pledging Mechanism for TA&CB and Funding 
23. Requesting Members could match their assessed needs for TA&CB and funding in "pledging" 
round(s) where donors would make firm commitmen ts to provide parts or all of the TA&CB 
requested by a specific Member in exchange of th e obligation to implement a certain trade facilitation 
measure. We understand "donors" to include de veloped countries, other developing countries, 
multilateral institutions, national, regional and inte rnational trade federations , and other interested 
                                                     
 
5 In addition, one could also imagine that expert s in trade facilitation woul d prepare guidelines per 
measure (or per module) for the Membership on the kind of information that needs to be contained in the action 
plans.  TN/TF/W/63 
 Page 5 
 
 
 private business associations. Infrastructure financi ng, if and when required, could be obtained from 
multilateral development banks, which are speci alized in dealing with these issues.  
24. Pledging rounds would not necessarily need to consist of well organized processes in all 
moments, but would definitively gain in effici ency if coordination between donors and executing 
agencies were ensured at the country level. "Pledgi ng" can also take place in the form of customary 
bilateral exchanges. 
3. Multiple Channels to Provide TA&CB and Funding 
25. Donors could choose to provide their assistance either bilaterally or multilaterally, earmarked 
for certain recipients and certain activities or not, as well as purely funded and/or partially or fully 
provided "in-kind" (sending their own experts to provide assistance). Therefore, these various 
channels for funding and providing TA&CB need to be kept open.  
26. The mechanism for providing TA&CB could take into account the following: 
• the object of funding would be the measures contained in the inventory of trade facilitation 
measures and defined as being eligible for support; 
 
• provision of TA&CB would be based upon each c ountry's action plan for trade facilitation. 
Due regard would be paid to administrative and financial constrai nts of each developing 
country and its access to grants and credits. TA&CB and/or funding would be sequenced 
according to the effective pace of implementation;  
 
• the provision of TA&CB and/or funding woul d be "demand-driven" and hence would imply 
the recipient Member's commitment for implementation. 
 
27. In order to facilitate the request process, Me mbers could consider to develop guidelines for 
presenting requests as suggested in footnote 5.  
4. WTO Trade Facilitation Committee to Endo rse Members' Obligations (TF measures) 
and Commitments (TA&CB and funding) 
28. Once the pledging round is complete, the re questing Member will revise its action plan, 
containing the consolidation of all secured project s and resubmit it along with the pledged support to 
the TFC.6 
29. The TFC will have the possibility to ask for co mplementary information to endorse or refuse 
a Member's action plan. In these cas es, this Member should have the possibility to submit its action 
plan to the ad hoc  maybe regionally organized group(s) of i ndependent and internationally-recognized 
experts (some kind of technical committee) in or der to get a second opinion and objective advice. 
30. The TFC would then give its final approval to the action plan. At this juncture all parties 
involved (requesting Member and donors) would notify their intent to implement compliance with 
                                                      
6 Two scenarios may occur: (a) th e requesting Member was able to complement its action plan with 
additional resources or (b) the requesting Member has not obtained all the financing needed to realise the full 
action plan. In that case the Member could agree to main tain its commitment to implement a certain measure but 
on conditional terms, based upon the condition that the requested TA&CB or funding would be forthcoming in the future. This kind of mechanism would allow to maintain the momentum in trade facilitation beyond the 
negotiations. TN/TF/W/63 
Page 6  
 
 the rules and to provide TA&CB and/or funding according to the terms and conditions set out 
in the action plan.  
 
5. Multilateral Endorsement of Implementation Capacities 
31. Once the implementation period for a measure agreed to by the Member is over and the TFC 
has reviewed the effectiveness of the support and assi stance provided, the obligations undertaken by 
the Member would become binding. Therefore, Memb ers need to further reflect on how best this 
review could be done. 
32. Finally, we need to answer the question what happens in case the TFC agrees that the 
intended TA&CB and/or funding has not been forthc oming. Well, the answer is quite simple: the 
Member would be freed from its binding obligation to  comply with certain rules for which the request 
for TA&CB and/or funding has not been satisfied. 
IV. FINAL REMARKS 
33. Although we have tried to propose some operational ideas on a mechanism to address the 
elements contained in Annex D, these need to be  further scrutinized. Moreover, certain questions 
remain largely unanswered as for example: 
• How to ensure that countries currently playing only a marginal role in world trade will be 
able to accede funding for trade facilitation measures? 
 
34. Moreover, discussions on the mechanism should al so consider clustering recipient countries 
with regards to the implementation of certain measu res as well as for relate d TA&CB and/or funding 
in trade facilitation (e.g., on a regional or sub-re gional level). This should namely be the case for 
transit countries, which need to coordinate and adju st their action plans in accordance to the needs and 
priorities of landlocked developi ng and least-developed countries. 
35. Finally, recognising the asymmetry that the implementation burden of a trade facilitation 
agreement would primarily fall on poorer countries, Switzerland is ready to consider making firm 
commitments for providing TA&CB to our partner countries, both for supporting the initial 
assessment stage and for supporting the implementation phase .  
 
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  TN/TF/W/63 
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 ANNEX 
 
World Bank / World Customs Organization Analysis Grid  
  
 
 
 
__________ 
 
 Benefits for Government and 
TradersLow High Low HighLowImplementation 
Difficulty/CostLowImplementation Difficulty/CostReject Proposal ?
Consider S & DT and 
TA/Capacity 
Building needs & priorities ?
Don’t Care ? Support ProposalSupport Proposal
Consider S & DT and 
TA/Capacity Building needs & 
priorities ?Reject Proposal ?
Consider S & DT and 
TA/Capacity 
Building needs & priorities ?
Don’t Care ? Support ProposalSupport Proposal
Consider S & DT and 
TA/Capacity Building needs & 
priorities ?