MANILA, Philippines — The Asian Development Bank (ADB) is pushing countries in Asia and the Pacific to strengthen supply chains for growth by integrating trade facilitation and transport cooperation in regional trade policies.
In the multilateral lender’s latest blog, ADB economist Sanchita Basu-Das recommended steps economies in the region should take to have resilient supply chains.
“Economies across Asia and the Pacific are seeking to increase trade within and outside of the region. Broader coverage, aligning with supply chains, and comprehensive cooperation between transport and trade facilitation is needed to support these efforts,” she said.
While trade facilitation, which includes at the border customs procedures, and transport connectivity covering hard infrastructure and international regulations are both important to boost trade, she said their connection in policy discussions is not always clear.
Citing a 2021 World Trade Organization (WTO) study, she said transport costs and regulatory differences among countries account for 29 percent and 16 percent of the overall trade cost.
To address the challenges, among her recommended actions is for countries in the region to improve coordination on trade and transport facilitation.
This, as transport connectivity and customs facilities are often disjointed and lead to inefficiencies.
She added a unified policy approach would be needed for efficient trade and transport facilitation.
“Regional trade policies should integrate trade facilitation and transport cooperation,” she said.
While customs procedures are well covered in policy documents, this is not often the case for transport connectivity.
The ADB economist cited the need to incorporate gender mainstreaming, inclusivity, and climate change considerations in the region’s trade facilitation policies.
According to her, countries have to accelerate the implementation of the WTO’s Trade Facilitation Agreement, which has provisions on expediting the movement, release and clearance of goods.
She also urged countries to adopt paperless trade practices to promote resilient trade.
“Beyond facilitating trade, modern transport and trade integration should also prioritize countries’ policy objectives of decarbonization, inclusivity, and technological advancements,” she said.