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HONG KONG OBJECTIVE
Negotiations must show significant progress in reaching
an agreement that will reform outmoded customs and port
procedures.
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If Trade Facilitation Is Ignored In The Doha Round, Gains
From Tariff Reduction Will Be Lost To The Costs Of Red Tape
And Bureaucracy.
Trade facilitation refers to improved efficiency in the
administration, procedures, and logistics at ports and customs.
A trade facilitation agreement will cut the red tape and reduce
the cost of importing and exporting.
Red tape and unnecessary formalities at the border can eliminate
the gains from tariff reductions. Indeed, some studies have
indicated that antiquated and inefficient customs procedures
in some countries can increase the cost of selling into a
country by 5 to 15 percent.
Trade facilitation measures are expected to provide particularly
important benefits to small and medium-sized U.S. exporters
who do not have global systems in place for dealing with varied
and cumbersome customs procedures.
Studies indicate that even a one percent reduction in trade
transaction costs could improve global welfare by $40 billion.
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