Global Alliance speeds up international trade – unlocking investment and growth benefits
31 Mar 2021
Recognising that neither governments nor the private sector could deliver on the full potential of trade facilitation on their own – the Global Alliance for Trade Facilitation, a collaboration of international organisations, governments and businesses, was launched in December 2015 at the WTO’s 10th ministerial conference in Nairobi.
The Global Alliance for Trade Facilitation is a public-private partnership for trade-led growth, run by the World Economic Forum, the Center for International Private Enterprise and the International Chamber of Commerce, in cooperation with Gesellschaft für Internationale Zusammenarbeit.
Since it was founded, the Alliance has made cross-border trade simpler, faster and more cost-effective. It is the first initiative to provide a global platform to leverage business expertise and resources to implement customs and border reforms.
"This (Alliance) was the first time we have worked with the public sector in this way – not just responding to consultations but sitting around a table with the public sector, other businesses and my head of ocean freight and head of road freight to really deep-dive into the weighing process in Morocco, the issues are we facing and our ideas for addressing them."
What's the challenge?
Worldwide, more than 50% of trade is subject to some form of red-tape at borders, with the average customs transaction involving 30 parties, 40 documents and 200 data elements.
There is a pressing need to remove trade barriers worldwide. When trade is easier, more trade happens – unlocking investment and growth benefits for all.
“Getting engaged in the trade facilitation discussion is very important for business. In many cases business has the solutions that government needs, business knows what will work and also has the technical capacity to help deliver change.”
The Alliance is funded by the governments of the United States, Canada, Australia, Germany and Denmark with businesses contributing resources and expertise in-kind. It creates an environment where businesses can trade more easily, with predictable procedures, streamlined regulations and modern automation. This can lead to increased trade and investment, which unlocks inclusive economic growth and poverty reduction.
To date, the Alliance has contributed to the implementation of one of the greatest global trade agreements in two decades, new understanding of trade facilitation needs across the world and ongoing border management reform activities in over a dozen developing countries.
Initial concrete outcomes include a reduction in unnecessary inspections, faster processing times and legal and administrative reforms in international trade.
An example of the Alliance’s impact comes from Colombia, where the Alliance worked with the National Food and Drug Surveillance Institute to focus physical inspections on priority shipments, eliminating 20,000 inspections and saving $8.8 million in the first 18 months of operation. By generating $29 in savings for every $1 spent, the project demonstrated how governments, aid organizations and business can work together to get things done faster, better and more cost-effectively.
Alliance projects have also benefited the agricultural sector. Collaborations in Morocco, have led to the roll-out of automated phytosanitary trade processes which give agricultural businesses more predictable, easier, and less costly access to the seeds and plant products they depend on.
In addition to sourcing project ideas directly from governments and businesses, the Alliance has turned to wider audiences for fresh thinking through trade-focused hackathons. In 2020, the Alliance collaborated in two hackathons at Valencia in Spain and Casablanca in Morocco that attracted more than 800 participants from almost 40 countries, generating over 110 proposals to modernise and improve port processes at both cities.
“The (Morocco) hackathon created a space for creativity, and the exchange of ideas. It has also provided a competitive platform for start-ups, students, academics, and professionals to showcase their talents and use them for the good of the community,”