Bangkok Post, Thailand, Leading The Way Column.

Byline: John Grice

Aug. 5--Trade facilitation is one of the main economic co-operation activities identified by the members of World Trade Organisation (WTO). Its aim is to benefit business by allowing the cross-border movement of goods around the world at a reduced cost, and in so doing to allow for goods to become cheaper for consumers.

While the world in general has been successful in reducing the relevance of trade barriers such as import tariff rates, and introducing standard classification and valuation procedures to assist business, new challenges to trade facilitation continue to emerge.

Examples include increased requirements on consumer safety, product and labour standards, all of which result in additional costs to business and consumers, which are contrary to the aims of trade facilitation.

The most recent challenge is that of supply chain security. This particular issue is germane to many of the recent US-led strategies such as the Container Security Initiative (CSI), which allows for the deployment of US Customs officers alongside host nation counterparts to target high-risk cargo containers, and the 24-Hour Advance Manifest Rule (AMR) which requires shippers to submit a cargo declaration 24 hours before cargo is placed onboard a vessel at a foreign port.

The introduction of these strategies in 2002 has led to an increase in the level of administration within the supply chain and as a direct consequence has increased the cost of goods to the shipper. The Bangkok Post reported on June 11 that the CSI had "forced carriers to add an additional US$40 (about 1,680 baht) per bill of lading and freight forwarders to charge another 1,075 baht per shipment".

These costs must be either absorbed by the shippers themselves or passed on down the supply chain to the eventual consumer. Regardless of the methodology adopted, the bottom line is that additional costs are being added to the supply chain rather than being removed; this is not the aim of trade facilitation.