 Okay. I think we're going to get started. I'm going to ask my friend Scott Miller to come up and make some opening remarks. I'm Dan Roddy. I hold the Shrier Chair here at CSIS. We're going to have a conversation today about the future of U.S. trade facilitation and its development impact. And we do so within the context of the recent WTO agreement that was agreed upon, I guess is how I would describe it, as opposed to it was not signed and I think we'll learn a lot more about that. But I think it's this very interesting area of trade and development and we've been working a lot on these issues at the intersection for the last several years at CSIS. But I'm going to turn the floor over to my friend and colleague Scott Miller. Scott? Thank you, Dan, and welcome to CSIS. It's a pleasure to be here today. And I'd like to just very briefly congratulate the United States and all the members of the World Trade Organization at concluding the Bali agreement, which includes an agreement to implement a treaty on trade facilitation. What I'd like to do today in a very brief period of time is talk about the three reasons that the trade facilitation agreement is good for development. First, trade facilitation is good for economic growth and trade growth. Trade facilitation is a set of disciplines and guidelines that can lower border transaction costs and allow goods to move efficiently and predictively. It's important to recognize the trade costs or trade costs, whether they're tariffs or non-tariff barriers or just the frictions that occur at borders and all of them matter to the efficient movement of goods. Trade facilitation is particularly important in the 21st century trading system, which is basically firm-directed global value chains. For countries to effectively participate in global value chains, they need to be good importers because 60% of trading goods is intermediate products, but they also need to be able to move products in and out of their markets efficiently, quickly, and predictably. Trade facilitation helps that. How big a deal is this for world trade? Well, Gary Huffbauer and Jeff Schott of the Peterson Institute for International Economics estimates that the trade facilitation agreement is worth about $1 trillion in annual trade growth. So it's a big number. About half that goes to developing countries, about half to develop. So it's a big win economically. It will grow trade and trade growth will help income growth. The second reason that the Bali agreement is a big deal is that it's a very high leverage investment for development. The development experts and funders have lots of decisions to make about where they invest. What a 2009 study showed is that every dollar spent on trade facilitation, that would be customs procedures or efficiency in ports or whatever it might be, but every dollar spent generates $6.37 in annual trade growth for the economy that invests it. So those were innate for trade countries. So the countries most need of this, most benefiting from it, can undertake a very high leverage investment by spending on better ports, better customs facilities. Finally, trade facilitation agreement at Bali is good for development because it's a sign that the multilateral system can work as intended. This is the first truly multilateral agreement that the trading system has produced since GAT 94, so 20 years for the first agreement, but it's an important one because many of us have long hoped for more from the WTO, but whatever it produces, it produces the greatest good for the most people in supporting a multilateral world-based trading system. The fact that the Bali agreement was achieved is good news for the future of development and the future of the multilateral trading system. With that said, let me extend my welcome to you here today at CSIS and turn the program over to Eric Pastel. Eric is Assistant Administrator for the Bureau of Economic Growth, Education and Environment at the U.S. Agency for International Development. Eric. Hi, everybody. Good afternoon. I am here to maybe give a little historical context, although Don is much more expert and will probably amplify and then also talk a little bit about USAID's involvement in this area because as we start to, as this thing starts to move forward and one starts looking at implementation, we are one of the instruments of the U.S. government to work on this with the members of the private sector in our country as well as all these developing country participants and to have conversations with other donors in other countries. So, as you know, the trade facilitation agreement known as the TFA was the signature accomplishment of the Bali package adopted in December at the ministerial conference, the ninth ministerial conference of the WTO. And as you just heard, it's this first multilateral agreement reached by WTO since its creation under, as part of the Uruguay round of negotiations and also represents the first agreement under the so-called DOHA development agenda or DOHA round of trade negotiations started a while ago. And one of the objectives of that round was to improve the trading prospects of developing countries and this agreement is targeted at that. And we know that improving the trading prospects of the developing countries is also a good business for our own country. The negotiations, I believe, started in 2004 on this and at times people thought, oh, this is going to be easy. We're going to get this done quickly. It compared to other things being talked about in Geneva and it didn't exactly work out that way because even though it seemed like, oh, timely movement of goods across borders ought to be a win-win for everybody. So, to our way of thinking, there's several reasons for this. But in some cases the opposition was less on the substance of the agreement and more on other concerns that I'll try to characterize. One, there were a number of developing countries which took the position tacitly that anything desired by the developed countries must not be good for them, so there must be some trick to this. Luckily, that number of countries was modest and I think shrunk over time as they saw themselves growing often through trade. More problematic among some of those was that some of those countries felt that these discussions were an opportunity to exact a price from developed countries, particularly in the area of agricultural market access issues. And so they were reluctant to make any trade facilitation commitments even in the face of all these studies that their own folks had done that indicated that this would pay significant dividends for their countries, for their businesses and for their people. So these things were some of the things that got in the way and I'm sure Don may elaborate and she's going to give more details of exactly what got done. Another reason for the resistance and was maybe a little more understandable is that many developing countries viewed with concern any new WTO commitments as being binding obligations on members. And they may not have fully understood that in the aftermath of the Urugra round and they realized that when they signed this stuff it actually had a lot of implications for them. That their focus on becoming members of the WTO for instance had them so consumed with that that they weren't necessarily paying attention to all of the things they had to do to comply with WTO agreements. And so they were very, they really need to focus on how do we deal with the challenges of implementing things like that and they want to be very careful about what they were going to do, what developed countries were going to do and so forth if they were going to sign on for new things. So I think some of that helps understand why the TFA which aims to streamline trade also has this section called section two special and differential treatment provisions for developing country members and least developed country members. That's a mouthful but in essence it constitutes an agreement by the donor countries to provide technical assistance and capacity building related to the implementations of the provisions of the TFA. And that was a very important thing because the agreement was very clear that there would be some flexibilities about implementation time frames and that if they didn't have capacity that that's something that had to be worked in through all this. So in order to achieve all the benefits, the bottom line is to achieve all the benefits donor countries and recipient countries have to work closely together. Now the potential benefits of the agreement are huge as you heard and there have been other studies about this that in a whole range of areas whether total trade costs, reduction for low income countries, for middle income countries, all of them would have a number of benefits under this. OECD studies showed this and many others. So what is USAID's role in this as we go forward? We've always been involved in trade facilitation activities around the world. We're the largest provider within the US government of trade capacity building assistance. We know it's an important issue and we have a number of bilateral or regional programs that focus on things like customs reform or other aspects of trade facilitation. And for example, we've got three trade hubs in Africa as a number of, you know, and they all have focused on trade facilitation measures working bilaterally and with the regional economic communities to reduce the time and cost of moving trade within Africa and between Africa and the United States. We've also worked on trade facilitation in the Asia Pacific region working with ASEAN and we've done plenty of stuff in Latin America and so forth. So we know there's a strong linkage between trade and economic growth and we know that there's a number of impediments and in some of those cases donor involvement can help improve things. In other cases it's things the governments have to do on their own. So during these talks we've tried to support the US TR team working on all this and we've also facilitated WTO self-assessments for 20 countries and we launched in 2011 something we call partnership for trade facilitation and contributed to the IFC's multi donor TFA support program. So we've been contributing to some of the prep work that went into this stuff and some work that helps some of the countries get rolling on this. That partnership for trade facilitation partnership that I mentioned is active in 15 countries addressing issues that are directly related to TFA. As far as bilateral programs every one of our offices overseas then determines how high on the priority list of the issues faced in the country are trade issues but a number of them around the world have worked on different things such as custom streamlining, helping to create single windows, one stop border points, IT integration so that customs authorities across several countries can move documents electronically and in turn move them electronically with businesses. So there's been a host of projects in different countries depending on a complex process of setting priorities both within the US government and with those countries. So as we go forward though we're going to have to figure out what else we have to do, what are the things that those of you in the private sector think are some of the main priorities, what does our USTR colleagues think are priorities and of course talk to local government. So I come to make these introductory remarks but really I've come to listen and we want to thank the private sector for all their support that they've given during the negotiations and we know that we have to be connected with you and listening to you all and getting best practices from you all in a partnership to really try to move this forward and facilitate trade. So I look forward to hearing from all the experts on the panel and we look forward to hearing all of your inputs both today and in the days ahead because this is a process that's going to spool out over a period of time so thank you. Thank you very much Eric. Thank you for all the work that you guys do at AID and I know some of the folks here from Virginia and some of the other colleagues are here as well and I want to thank what the folks at AID do to follow up on all the agreements that get done and it's good for development, it's good for trade. We have a panel that's going to talk about this the future of U.S. trade facilitation and its development impact and I'm just going to just recognize each of the panels very briefly and then I'm going to turn the floor over to Dawn Shackleford. We first have Dawn Shackleford, she's the Deputy Assistant U.S. Trade Representative for the WTO in Multilateral Affairs, the Office of the U.S. Trade Representative and she was the point person on the negotiations and so much of the credit goes to USTR and also congratulations to Dawn for for making that happen and so particularly grateful that she's here. We then have Mr. Ralph Carter who is Managing Director of Trade and International Affairs at FedEx Express. I think he was also at Bali if I understand it correctly, were you there? I was only there for the APEC. For the APEC. I knew she could bring it home. Yeah that's it, that's it and he's with he's in Trade and International Affairs at FedEx Express and then we have my very good friend Anna Guevara who's the President of Aventi Associates and the former Alternate Executive Director for the United States for the World Bank and she's worn other hats at the Department of Commerce as well as had a distinguished career at UPS as well and so thank you for being here Anna. And then my friend Paul Delaney who's a partner at the Kyle House Group but many of you know him as a as someone who's been a staffer on the hill working on trade issues. He also had a distinguished career at USTR and also had a a stint in the private sector also at FedEx where he was a Senior Attorney for Trade and International Affairs. So you have their biographies in front of you so you can get a sense of who these folks are in a little bit more detail but without further ado I'm going to turn the floor over to Dawn Shackleford to give us a little bit more context of the agreement as it's been negotiated and and what the implications are for trade facilitation for the for the US government more broadly. Dawn over to you. Well thank you very much Daniel and thank you for hosting this event today and it's really a pleasure to see so much interest in in the agreement. You just to give a little bit of background on the US negotiating position in the WTO negotiations. There we go. Is that better? Okay great. The US negotiating position certainly I mean I appreciate the praise but it is a group effort and we do have within the federal government there is a trade policy staff committee process in which we have 19 different agencies that do contribute to our development of trade policy negotiating positions and we work very closely with USAID of course but also I see a number of colleagues in the audience who at even at points were sitting next to me at the negotiating table from Commerce Department and State Department and other agencies that were deeply involved in the negotiation so it is really a team effort on the part of the US government to bring home this agreement. We also in addition to having extensive coordination within the US government we do reach out to stakeholders whether that be private industry, NGOs, other groups that have an interest in these agreements and this was true for the entire Bali package. We do have the advantage that the WTO is very forward-leaning in its publication of documents so there is a lot of transparency in this organization and all of the documents that we were working on the main negotiating text was always public. It was always publicly available on the WTO website so while we do have set advisory groups that we do rely on because everyone had access to the text we certainly received a lot of input from various groups and so it was a great opportunity that we would get pretty instant feedback when there would be a new revision of the text would be posted after a negotiating session. So we did have a lot of input within government also from a broad array of stakeholders that had interests in the agreement to actually get us to where we are and also of course the hill too. Our committees of jurisdiction are House Ways and Means as well as Senate Finance and we also worked very closely with our committees of jurisdiction on the negotiation of this agreement. There's also a lot of coordination that goes on to to come to this type of agreement in the WTO as you know there's 159 current members. One of the other successes of Bali was that Yemen was agreed as concluding their accession process so we hope to have them as a full member very soon. So getting 160 countries on the same page on what is a very lengthy document with very technical issues was a long process and we certainly had various coordinating groups that we engaged with in Geneva to bring us to the finish line. The United States created what was called the Colorado Group a number of years ago which was made up of kind of those who were really what we saw as kind of the friends of trade facilitation. A number of developed countries but also a number of developing countries that really wanted to push these negotiations forward. That group and members of it worked very closely with what was called the ACP the African Caribbean Pacific countries which had a very lead role in the negotiations and a number of those countries were also very forward leaning on trade facilitation. The African group the LDC group and of course all of the major developing economies like Brazil, India, China, South Africa had very key roles in the negotiations. So it was a kind of a constant coordination effort to get everybody moving forward on this agreement over the past several years and that is part of the reason why it took so long to get everything to where we were able to get it in Bali and as Eric mentioned earlier I mean there certainly were some challenges along the way at getting everybody on the same page and there were certain countries that did want to use this agreement as somewhat of a negotiating chip to get other things that they wanted that were not contained in this agreement so that was another reason why it took quite a while but I did want to spend some time and again we want to hear from you so I don't want to spend a whole lot of time but just talking a little bit about what happens now. So just to clarify very clearly what happened in Bali what we did is we finished the negotiations so all the members came together and agreed we are not going to negotiate on this anymore we are we are happy with the text as it is and we're going to set out a few homework assignments between now and we set the date of July of this year to finish a few of these homework assignments kind of the housekeeping things that need to get done for us to be able to sign the agreement. So the specific tasks that were laid out is we have to set up a committee because the negotiating committee is done we've done the negotiations so now what we've established is what's called a preparatory committee we basically followed what was done during the Uruguay round after those negotiations were done the preparatory committees took over to actually start the implementation process we followed the Uruguay round example we have now as of just a few days ago a chairman it's the ambassador of the Philippines who will be chairing the committee and he will be overseeing some of the steps that we laid out which are the first thing we're going to try and accomplish is a legal scrub of the text this is not a negotiation this is making sure we crossed all the t's and dotted all the i's we also have to finalize a protocol and what this will do is if you look at the WTO agreement itself there's all of these annexes that go with the WTO agreement what we have to do is we have to have a protocol that amends the WTO agreement to add the trade facilitation agreement as one of the covered annexes and this is very important because that means then that the WTO trade facilitation agreement is what is considered then a covered agreement for the purposes of dispute settlement which means that these are binding obligations under this agreement so the drafting of of that text we actually started a little bit of that in Bali looking at what we wanted to go in into that we just didn't have time to fully negotiate that at Bali while we were there but i think that that process there's a skeleton there that process will go forward over the next couple of months in the preparatory committee. Another piece of homework is that all of the developing countries have to submit what are called their category A notifications and i want to explain what that means in layman's terms in the agreement as eric mentioned there is a there are two sections of the agreement there's section one these are the more technical obligations that they're you will publish your customs procedures that you will allow for pre-arrival processing you will allow for release under bond the very technical aspects the section two of the agreement is how are you going to do all that how are you going to ensure that you can implement everything that is in section one and for the developing countries as as eric had mentioned this was a key concern to them they were worried about how they're going to be able to implement some of these very forward-leaning customs practices that when you think of the you know a country say in sub-saharan africa a landlocked country in particular that doesn't have many resources this was a heavy lift for them they're very concerned about how they are going to implement this so a lot of time was spent on this section two and identifying what commitments the countries would undertake at the time of entry into force of the agreement and what commitments they would undertake after a transition period after entry into force of the agreement there are the category a provisions are those provisions that countries agree to implement at entry into force of the agreement there are other commitments that are labeled category b commitments and category c commitments these are all spelled out in section two category b commitments are those that they will implement after a transition period but they think they can do it on their own without outside help and category c commitments are those that they think that they will need some form of technical assistance to implement those notifications come at a later point in time but the first thing we're trying to do between now and july is get all of the category a notifications in working with countries to help them with that process in usa id has been very actively involved in that process as have many other donors the wto set out a function of setting up needs assessments to help countries determine what goes into category a what goes into category b and what goes into category c looking at section one of the agreement and putting each of the provisions into one of those three categories so most of these countries have actually had two of these needs assessments done so they have something in their hand already that gives some idea of how they can implement the agreement the category a's come by july we then are hopefully in a position to sign the agreement in july we then open the agreement for ratification under wto rules we need two-thirds of the members to ratify and at that time and we have set a target date of july 2015 for entry into force so once we get the two-thirds and the target date being july 2015 we will then have entry into force of agreement at that same time the developing countries will provide their initial draft notifications of category b and c but we will have a pretty good idea before then what's going to go into b and c because we'll know it's what's not in category a i think i'm going to stop there to just give you a kind of an overview of of what we have coming up in terms of implementation and while there is this flexibility for the developing countries to choose what goes into these categories we will be having a lot of consultations with countries on what goes into these categories and encouraging them to be as ambitious as possible in this and the last thing i would know is even though there is this flexibility in the agreement there is likely going to be more oversight of the implementation of this agreement vice any other proceeding wto agreement because there are so many checks and balances contained in section two that we do believe that we are on a path to achieve full implementation of the agreement in a timely manner so thank you very much and i'll turn it over to ralph thank you don ralph thanks dan thanks don happy to be here today uh get to give kind of i guess a private sector view on this let me just echo everybody's statement that this is a big deal uh you know we as the express industry have been promoting customs modernization and trade facilitation for 20 something years so to us this is a real validation of a lot of what we've been saying about the economic impact of of making borders more efficient so from that standpoint it's it's a huge win for us uh it's also of course a huge win for the trading community and especially our customers uh you know what this does is for the first time we have binding enforceable standards that all of these 159 160 soon to be 160 countries have to comply with and we've never had that before previous to this we had the world customs organization which put out a very good set of guidelines but they were voluntary so what the wto agreement did was take a lot of those good best practices and put them into this binding agreement so from that standpoint it really is a milestone uh and we're very very excited about it again hats off to dawn you know the us was the the key demandor and a lot of the more ambitious uh provisions of this agreement uh and they they fought tooth and nail all the way down to the to the last minute uh to keep the agreement as strong as as it possibly could be given that you're negotiating with 159 countries of vastly different economic positions uh it's also important and i think especially important for development and for developing countries uh in fact most studies will will show that the developing countries and least developing countries are going to get the biggest benefit from this you know the the bali package was supposedly made up of three elements you had the agriculture you had trade facilitation and you had development in my view trade facilitation in the long run will be the biggest development boost of all three of those things because of the impact on these countries ability to compete in global supply change to make their economy is much more competitive to enable them to integrate more with the global economy uh you know i have to say i have to repeat some of the statistics uh that we always hear you know 10 percent administrative costs account for about 10 percent of the cost of trade which is twice the average tariff of about five percent that's why studies like the world economic forum concluded that if you reduce trade facilitation barriers uh you can have six times the impact on gdp then you would if you reduced or eliminated all tariffs around the world so again the economic impact of this is is significant uh but that's it those benefits are only going to be realized if we implement the agreement and if it's implemented to a high standard so that's where our industry is very very concerned and interested and will be very engaged as this process rolls out don gave you a hint at how complicated the process is in terms of time frames and and baskets of a b and c and and all of these things the other element that makes it complicated is this is not like a lot of international agreements where through the stroke of a pen you know you reduce a tariff that's easy to do and it's easy to verify that it's been done this agreement is going to require things to actually change operational things practices that have been going on for many years will have to change in order to implement this and that's difficult uh the the agreement is not going to implement itself people will have to do a lot of things to make it happen and so that's where our industry again is very much engaged uh and we see a huge opportunity of course to raise the level of performance uh of of countries across the world in terms of the border management but we also see an enormous opportunity to drive harmonization of a lot of these standards again the agreement has a lot of technical measures but in fact they're not that technical in that they say you shall provide expedited clearance or you shall provide pre arrival but it doesn't tell you how to do that actually uh and a lot of these countries will be doing these things for the first time so there's a lot of room for interpretation and so what we wouldn't want to see is you know 160 different versions of expedited clearance for example we think you'll get a lot bigger bang for the buck if we have harmonization if everyone's kind of driving in the same direction and certainly regionally we think it makes a lot of sense for trading partners to coordinate with each other and try to use this as an opportunity to drive harmonization and interoperability in their customs regimes with their key trading partners again everybody's going to be doing this so you have an opportunity instead of going in 160 different ways that's all going the same direction a lot of these things uh you know and that's again another kind of leveraging of this agreement the more implementation you have the more the economic benefits there'll be it's a multiplier effect when your neighbors start doing it you will benefit from it and on and on uh so the challenge is okay how do we how do we affect this process how do how do we as as industry and companies as shippers and retailers and everybody who's concerned about this how do we organize ourselves to to engage in the process and that's what you know we're looking at right now one of the things I think we want to try to come up with is working with groups like the world customs organization is a toolkit for implementation a set of best practices guidelines technical standards that will help a country implement the various provisions in the agreement to say here's actually the best way to do this here's the most cost effective way to do it and here's how you'll get the biggest economic bang for your buck uh and so we're going to be we're interested in working with USTR of course as they engage in countries in the implementation process USAID as the primary US donor to countries we also will be working with hopefully the world bank and the regional development banks again to go to them and say here's what we think is is a set of best practices and that they can then take that toolkit and talk to the recipient countries and say here's what we think is a good a good way forward for you in terms of implementing these things there's also going to be a lot of work on which provisions you put in basket a and b and c you know we want everybody to be as ambitious as they can be put as many of the concrete provisions in basket a as they can for those in basket b we wanted to have a short implementation time frame not years and years down the road again the benefits of this if we can accelerate the implementation we accelerate the economic benefits so in terms of you know you talked about kind of the hill and in us policy and development policy and the fact that you know the u.s development budget is is is is not growing you know we think one of the most important messages is that this is such a win-win for the united states because it certainly supports our development goals because every study has shown that investments in trade facilitation can have a disproportionate impact in terms of improving a country's ability to compete in the global economy accelerate its development trajectory and so it's it's a win-win for those countries the investments we're talking about are very modest in fact especially if you compare them to building roads and bridges you know mostly we're talking about buying some computers and doing some training these kinds of things are very modest but they can they can return a huge economic impact so again very cost effective and then secondly it's a win for united states because it helps u.s exports making foreign customs procedures more transparent more simple more accessible will help us companies trying to sell into those markets especially small and medium-sized companies who are our primary customers a lot of what we do is try to navigate all of those customs arrangements around the world but if they can start to do it themselves if they're not intimidated by it if it makes more sense to them they will start to export more and that again is is strongly strongly supports some key u.s economic objectives so when you look at all the different things to spend money on we think this is a win-win and really will provide a great a great return for the united states i think i'll leave it at that thanks very much Ralph and i you've worn various hats on this around this conversation you've been the private sector you've been at the commerce department you've been with u.s treasury as part of the delegation representing the united states in front of the world bank group talk about trade facilitation from those perspectives thanks dan and i think you know one of the key things to really think about is where do we go from here so we have this great agreement thank you don and i know that some of us have been pushing for this since the early nineties and now we've got something in writing and there there is a party going on and that's very good and it's very well deserved because it's it's been a long time coming but the reality is let's let's look at this actually in december when this was being completed it was also the 10-year anniversary of the u.s chili free trade agreement and the u.s chili free trade agreement was the first trade agreement that actually had trade facilitation provisions in it including you know some of the very uh it this uh the wto agreement has expanded on that but it did have some of the very basic agreements on it and specifically on express delivery at that time as well and following chili then you know then it was singapore we expanded on that all of the kafta colombia panama but where are we on those we've got these great free trade agreements that have outlined these trade facilitation provisions and they're not fully implemented especially if we look at countries like Guatemala nicaragua uh in the kafta countries um so this is where we come in and we're looking at this we've got a great agreement and what's really good about this is this abc thing and and uh and a commitment to help the developing countries and the least developed countries to actually implement that because without that then we've just got another agreement with really nice words on it and maybe not any much better than what's already been done by the wco which were great uh the um guidelines but uh weren't uh mandatory or a commitment or binding so looking at um today on this question what he wanted me to do was really focus on in my experience um working on these issues with governments within government and in the development community one of the things that you know we've really noticed and i ralph touched on this as well is going to each country individually and seeming to be starting from scratch and what can be read as a as a as a guideline or a commitment or a provision for expedited clearance or for coordination between customs agencies or means different things to different people so i think one of the really key things that can happen interagency within our own process here and also within uh the international financial institutions and other international organizations like the world economic forum the international trade center and all these organizations that are working on this is to try to push forward a sort of what can i call it open source best practices let me take an example um one of the provisions is for risk assessment for customs clearance and the idea is that if you have a risk assessment procedure you can identify what packages and what shipments to look at through scientific numbers and through computers and then that way you're focusing on the ones that are either going to bring you the most revenue or are going to um be most likely to maybe have some issues that you can stop for security or for tariff regions or for whatever the reason may be so as a as an industry and i know because we we bought this battle with FedEx for many years when i was at UPS we go to each country and we would offer help and each country would have to start from the beginning of where do we start we need some software well the private sector would offer their software and they'd be circumspect of that well we can't take the FedEx software we can't take the UPS software because that's going to you know maybe there's something in the software that's going to favor them or something like that so um so then they would start from scratch to build this software what i call is that we have like the World Bank or these international organizations get together and put together an open source software for risk assessment implementation for other things so that each of these countries and if we're making our monies really go as far as it can go and we don't have this patchwork like uh Ralph was alluding to is let's have something that is created that can be taken by all of these countries and use that so that we have more harmonization and we have simplification and we're not having to have to go each time and reinvent the wheel so what does that mean as far as all these organizations the WCO just met uh a few a few days ago on january 20th with the WTO to talk about what they can do so the WCO is going to publish uh implementation tools that's going to connect what the WTO negotiated with the WCO rules and they're planning on putting on some briefing documents to customs officials in their countries and how they can connect with their trade ministers because what is this what does this mean one thing that we've noticed is the customs officials are very technical and they have their way of doing their own thing and this is where the trade ministers and the people that have negotiated these things really need to have a nexus interagency on how this is going to work and how they can cooperate to implement these things and this is where like the private sector Ralph and people like the ITC can come in and get their views in place because no matter how well in tension a policy official may be if they don't have the actual practice in in the actual real functioning world their policy and their theory might not actually work and we've seen this in the past so many times in the private sector where well-meaning policymakers would write regulations and laws but they just didn't make sense in the real world so another one of my calls for action besides having you know these open source kind of initiatives is emphasis on looking at the providing legal assistance on the rulemaking because once the regulations and the rules are made and if they're passed through the national organizations then then it's then it's a little bit harder to go back and change those and a lot of these countries maybe they don't have all the necessary internal knowledge on what is actually going to make an efficient law or regulation and and so I think that that is one of the areas that interagency wise and also between multilateral IFIs and organizations to get out the help and I think we have some department of commerce folks here and I think that the department of commerce has in their general counsel's office actually a service that provides regulatory and legal help to different countries on capacity building we need to get those kinds of agencies involved so that we can help these countries write the laws and the regulations that they need to do it I think another interesting way to bring in all the different parties and Ralph you mentioned you were just at the APAC meeting in Bali right before the WTO APAC model for customs facilitation I think is really a best practice what does the model do it brings together the private sector it brings a peer review and it brings a system to give best practices and then it helps the country so I'll give you an example in the APAC model let's say it's going to a country that wants to upgrade its customs and trade facilitation provisions in the APAC customs facilitation group they'll bring countries that have done this well like for example Singapore Taiwan these other countries they'll bring in the private sector that have best practices like a FedEx and they'll come together and they do a peer review of what that country is doing and they come up with a checklist of things that need to be done and what kind of assistance and help they need then they come back a year later to see where they are on that and the key to this APAC system is that it brings everybody together and there isn't this misconception of I can't have this other country looking at me or I'm going to somehow be thought of less if I have another country coming and looking at my procedures so I would call as we're setting up all these monies and all these procedures and the WTO and the World Bank and the IDB that we get together and and really look at to put together something that has peer review and private sector and a process that brings all the parties together not just initially but throughout the whole process I think you know the the World Bank and then had asked me to talk a little bit about this and the IDB and a lot of these organizations since aid for trade a few years ago five years ago or so really got up and going through the WTO have put in a lot of programs to fund aid for trade and has given a lot of help to these different countries on aid for trade and and a lot of that up until now has been focused on looking at what are the costs of of goods being stuck at the borders and this have all been very good research that has been done and there's been a lot of looking at to see what what slows down a the movement of goods and what does that mean when the movements of goods are slowed down and what does it mean in least developed countries when it's 43% more cost of trade trying to get your goods through a customs clearance in a less developed country than a than a developed country and those have all been really great studies and I think you know the lesson on there is that trade facilitation aspect is very important and it is but all other things have also been identified which have to be with infrastructure with many other things that affect this so the whole movement of goods and getting them through these points is is really broader than trade facilitation but it's like they say how how how do you eat an elephant well you eat them one bite at a time and that's really what we're looking at and this trade facilitation agreement is that one bite there may be many other things that are related to getting goods across the border but we need to do that and and I think that you know interagency one of the most important lessons that we can learn is how how do they talk to each other how can we work together to really come together with the private sector and to help organizations like let's say it's USAID or Paul's going to be talking about the Hill how do we get those messages and help those organizations like USAID get the help that they need to be able to support these initiatives I'm at 13 minutes but so I'm going to stop there and turn it over to Paul yeah Paul over to you thank you Dan and thank you CSIS again for the invitation it's it's a real pleasure to be sitting in this table with some former mentors and friends and colleagues and not surprisingly they've covered many of the the points that that I think are most important so I will try and just hit a couple highlights and and maybe I think as Dan mentioned I come at this with sort of a variety of perspectives now I've worked at USTR for a number of years the Bush administration I worked at FedEx for three years working on these trade facilitation issues from the commercial perspective and also worked on the finance committee as trade council and sort of saw how the the legislative trade committees look at trade facilitation and trade policy more broadly I do think that the topic of this is about trade facilitation and development and as you've heard today and I'm sure you know read and gone to studies and or gone to other speakers and seen studies that we really have in the last few years seen a remarkable amount of attention paid to global value changed global supply chains trade facilitation trade cost I mean this this really is is a relatively new phenomenon in terms of being front and center in the trade policy debate and sort of international globalization debate and why is that well as as Ralph hit on some of the statistics that he went through that's where the costs are now you know that we we have the opportunity with technology with multimodal transportation and delivery services that literally consumers and and sellers can reach each other instantaneously through e-commerce and can actually get their products in days if not hours from when they make their orders and yet in certain regions of the world or certain countries we're still talking about weeks and months just across a border with their neighbor so that stark kind of divergence you know is is a core development issue so I won't get into the details of the trade facilitation agreement and and sort of its structure but I do think that what they accomplished in Bali what Dawn and her colleagues and all the various folks who've worked so hard on this have done is by creating a multilateral agreement focusing on enforceable commitments on trade facilitation that are concrete and admittedly you know as Ralph I think pointed out what the content of how you implement those commitments will be it will be incredibly important but by setting that in place disagreement actually is sort of the perfect place to look at the nexus between trade and development because these are where the costs are and these are are the policies that are really holding back a lot of countries from participating in the global economy so I think I just wanted to step back because I think that's why this is so topical and that why how this agreement is implemented really is going to have a dramatic impact on on our development policy but also on the commercial goals as Ralph mentioned of U.S. exporters and U.S. small businesses but also the the commercial sectors and all the other WTO members while serving on the hill I think it's it's it's actually quite illustrative that you know trade policy is done in the finance committee where I served and also the ways the means committee but development policy is really done in foreign relations and the foreign affairs committee and the appropriations committees and it's interesting because trade and development has been a topic for quite some time and you know growing trade and increasing trade should increase development at least many think so but our committee structures are set up where the jurisdictions are bifurcated or Balkanized in a way that that maybe we haven't been able to pull them together completely so on the trade side you know my old committee we would deal with trade agreement negotiations such as the trade facilitation agreement trade preference programs in terms of terror relief customs issues in terms of U.S. customs and U.S. customs interactions with other countries but on the foreign affairs foreign relations they would deal with the USAID budgets they would deal with the trade capacity building or the appropriates committees we really didn't interact as much as one might hope this agreement is going to require oversight from the hill on both sides so i'm hopeful i think there's a real opportunity here to help the the trade policy expertise and commercial expertise of the trade committees to get better involved and integrated into the oversight by the foreign relations and the appropriations committees and vice versa so i think that we we all as stakeholders in this private sector public sector NGOs multi that are should be invested in using this opportunity to help break down some of those jurisdictional barriers because this agreement actually can demonstrate how trade and development policy can work together just a couple comments on the agreement itself i think most folks covered it already but the way i see it is that how you sequence prioritize and harmonize the commitments particularly by the developing countries is really going to determine the effectiveness of this agreement certainly in the near term as has been mentioned there's a lot of stakeholders now who will play a role in that how the donors resource which priorities is critically important you know and how do they determine what is it what efforts are the world bank going to do with a particular country vis-a-vis what the corporate sector or foundation might also do vis-a-vis what USAID is going to do and how do you coordinate that i think the apex example is a very good one but but coming up with models to ensure that the various actors that are going to be involved in implementing the agreement are talking to each other and that the private sector because as Ralph said and certainly from my experience working at FedEx as well you know these are very technical commitments to implement and there are different ways to do it and if everyone does it a different way it will not work and so the only people who can provide that expertise are the actual operational commercial actors in these countries who are trying to get goods in and out of those countries and can say look actually here's the first problem you need to focus on or here's the and what's happening in this country is actually very different than its neighbor so how do we create that feedback loop how do we ensure that we have best practices we have harmonization but we also do have sort of a country-specific assessment which USAID is doing but making sure the private sector and the donors outside of the u.s. government are also contributing to that i think all of these of sequencing prioritization harmonization that really is going to be the key so i think finally i'll just say that you know this agreement will not implement itself so the folks that the the exceptional work the negotiators did in getting the first agreement the WTO and ever and also taking you over the 20 years we all have a vested interest in that succeeding so it's going to take all the various actors kind of coming together you know working with the individual WTO members helping the u.s. negotiators and the aid and donor community to to ensure that that success takes place um jobs are going to leave it that because i think we've got a great group here and and q and a will be interesting you know i'm gonna i'm just thinking about the time and i know there are a lot of thoughtful people in the audience i think i'm going to suggest we go directly to the audience and i'm going to do this world bank style and i'm going to collect three or four questions or comments and i'll take folks but as part of the deal if you if i take if i call on you as you're going to keep your question short and your comment short and pithy and that way you get points for that because if not i'll put you on the the list of not to call on do not call list in the future so um i'd ask you to identify yourself the organization and as i said a short comment or short question so that we can bunch together about four of these and then we'll have the panelists respond and maybe we'll get a couple more and i'd like to try and get about six so raise your hands high i see ambassador michael here he's going to get the first one this gentleman here i want a little bit of gender diversity so i'd like yes this woman in the front row and then i'll take a fourth as well who's the who's the lucky number for the person in the back okay so the gentleman in the very back okay so start with ambassador michael then this gentleman then this woman in the front row and then the gentleman in the back row ambassador michael the four years okay thank you uh this is bringing back a lot of memories of when i used to do this and uh the problem i think in part is that development is going to be different depending on the politics within each of the countries and i think it's wonderful to think in terms of harmonization and uh common approaches but i think these have to be then worked in the context of the policy environment and the capacities and commitments that you find in the different countries and that means it's going to be sequenced and prioritized probably in different ways if you have a finance minister who's counting on customs revenues for a big part of the national budget and a trade minister who's trying to facilitate things that will cut into that you know you're going to have to figure out how does that how do you work that in the country context and so i think part of you have what you think about is the incentives and one of the things that i remember from the past was that doing trade promotion that raises the stakes and the potential so that you're not just helping them to comply with agreements that others have suggested they should comply with but also helping them to get access to markets and create some wealth and jobs in their country helps a lot and i just wonder how you've thought about bringing those somewhat different disciplines of development and trade together in a way that will really work and carry out these objectives that you've all talked about for implementation ambassador michael in addition to being the former ambassador guatemala and having a distinguished career at aid was also the head of the major league baseball commission of foreign aid it's not called that it's called the DAC it's the development assistance committee so he was so it had a coordinating function at the OECD looking at all the different wealthy country donor agencies and so i think one of the other questions i think that's not been fully covered in this conversation so far is okay where are the europeans or the canadians and how are they going to spend their money to make this trade facilitation stuff happen so thank you ambassador michael this gentleman uh Sherman Katz i'm a trade lawyer and i'm not an expert on development but i wonder if i can put a question to eric pastel of usa id although he's not on the panel i just wonder if you've considered the possibility of and again i'm humble on the subject of usa id and its programs but have you considered the possibility that these tasks a number of which uh might be done by usa a id uh should be assembled into and i'm going to use those words which are perhaps bad words in washington a new program and uh i saw briefly in vietnam how the star program was so enormously helpful at getting vietnam to adopt new laws which can and regulations which contributed enormously to improvement of the business environment there laura dachner from the embassy of costarica thank you for a very interesting panel and i think free trade agreements already existing are a great platform basically to work on trade facilitation issues and really that should be in the agenda of any free trade committee meeting uh unfortunately in the case of cafta there has been only two meetings of the free trade committee on the second one which was about three years ago the ministers launched an initiative on trade facilitation basically recognizing that that was needed to broaden the benefits of the agreement but i don't want to point anyone but we really didn't feel much support from the usdr to move forward on this agenda and we understand all the constraints you know and everything you're negotiating so the central american countries decided we're gonna do this you know on our own there were seven priorities identified by the region as the top a trade facilitation priorities with the help you know of the private sector they even the u.s chamber here was very involved and we're working on that with different donors but aside of what we're doing you know i want to emphasize that free trade agreements already existing should you know be a platform and hopefully the u.s will use that platform also there is another program called a pathways to prosperity that is run by the department of by the state department where many latin american countries are participating Costa Rica co-chairs the pillar on trade facilitation but we've been i've been frustrated to know that the funding for pathways basically has a very strong emphasis on linkages with environmental and labor issues which are very important but trade facilitation should be a key priority by itself without linkages thank you very much i just want to make a couple comments thank you for flagging the fact that there i think some of paul's comments about the disconnect between agreements and then the funding for those agreements that are in different jurisdictions and then sort of the competing priorities for limited foreign assistance dollars that may not have been talking to the to the to the so the first thing i want to thank you for flagging that i also want you to i want to thank you for flagging what i think anna mentioned earlier about the fact that these implementation takes time i guess is maybe one way to put it and i appreciate you reminding us that perhaps um it's taking some time to fully implement some agreements that may have been agreed upon 10 years ago and so perhaps there may be a need for some further alacrity here in in washington on that and then the third i would just want to recognize that costa rica is if you haven't been to costa rica recently it's just an inspiring country it's one of the reasons i got into the development business and it's on a verge of becoming the oecd one of the wealthy i know they don't like calling it this but it's like the wealthy country club and they are a great country they're a democracy and uh they are also a middle-income country and and really a country to emulate and both in the region and around the world so thank you for being here thank you back there had the last question or comment sir sir the floor is yours whoever had their hand up the lap you said the back row that's you okay um just to follow up actually three of the comments steve landing manchester trade uh one of the challenges that we're going to face particularly in africa maybe in central america is that most of their progress has been made on a regional basis the wto however focuses on countries and countries responsibilities etc we saw what happened when the european union decided to negotiate free trade agreement which was maybe very good but with individual countries which destroyed efforts at a common external tariff so let me just ask two fairly specific questions one is it possible for the regional communities who are not really recognized yet in the wto but they have not fulfilled the requirements for a recognition to somehow participate in this exercise or for that matter for to allow you guys to build on all the work they already have done on trade facilitation and then the second question is more for us aid and notice a couple of very important people here from us aid and that is that for a developing country they're interested both in assistance to facilitate imports but they're also interested in assistance to facilitate exports out of the country and whether it's possible particularly if we take sherman's idea of a new program to maybe focus on both of those together and honestly i believe the benefits then to developing countries and the fact they will have to take dispute settlement obligations which is very hard for developing countries as you know and so on maybe so often and maybe in our own interest so two simple questions are one how do regional economic communities participate in this exercise which is really on a national basis and two how can we combine at least in our aid facilitation efforts both the idea of facilitating imports but also facilitating exports from the countries thank you so much i'm going to have eric and i'm also going to put my friend virginia on the spot i'm sure she'll thank me for this later she's thrilled i'm sure but i'd like each of you to just respond to the aid specific questions eric i'm going to give you mainly the floor but i'd also like to hear just briefly from virginia given that she does a lot of this the stuff for a day job so hi jim i love star went to vietnam and i agree and i know us tr all of us in the government have seen how that has really affects trade so um but by the same token some of the panelists were talking about i think gave me food for thought about interesting things that you know how do you how do you do this in a way that isn't sort of dictatorial but on the other hand where you come together around some open source things so it's not all one-offs and i think we have to think through some ways where maybe we encourage people without requiring people to coalesce and that actually affects i think the the comment you were talking about export sir but also the regional trade you know i i believe i'm not the trade expert that some of these people are but i believe the theory is that if everybody signs up to a lot of these things then all forms of trade are going to start moving faster so it's not just about imports from developed countries into developing countries it's about getting their exports out faster it's about the trade amongst the countries because heck you know there are some african countries where moving the stuff right across their borders within the same continent among the neighbors is worse than it is from them up to europe or over to here or whatever so i i think that um uh we've got to do a lot of thinking my head's buzzing from some of the comments and things uh and and virginian our team and our whole inter uh are all the bureaus within us ad have to start thinking about this and and what would be a good way to support it but in coordination and combination with private sector with european donors and and other people and and maybe even some non-traditional people i mean the brazilians the chinese other people they're starting to be donors this stuff benefits them too so what what can we do i don't have the answers yet but i think it's things that we have to think through okay virginia please if you just respond you've heard this interesting conversation there have been some questions directed to a i d would you want to just double click on either anything eric said or anything comment just briefly katie this this this woman back here anything you've just heard of him you get 30 seconds of air time thanks dan everybody who knows dan knows that he likes to put people on the spot like instantaneously i'm virginia brown i work for eric i'm the head of the trade and regulatory reform office at usa id uh i'll quickly since only have 30 seconds respond to steve though i mean i think the issue about the rex is really really important and dawn can touch a little bit on this um through the negotiations the africans especially but others in regional groupings were very concerned about this and there are some provisions that that that touch on this a little bit but they're um i think we've always viewed wto agreements in in some ways as as the floor like rex can then go above that but this would at least help some of them to get a unified standard among themselves and then if they choose as a wreck to go above that which is the ideal we hope we hope that they will do that so i think it's just i think it's an encouragement for the rex for the regional economic communities to talk about this as a group i know donal probably touch on this too as she responds but we want them as developing countries to get together as regional entities and decide a b and c among themselves this is the perfect opportunity i mean i people know i get really passionate about this this is the perfect opportunity to have for them to have that dialogue and and to move as a regional grouping to say we're going to do this together and we're going to pick the same time frames and we're going to put the same things in a b and c even if some of us are a little behind that it provides incentive within those regional groupings and i love the fact that my boss eric said the exact right thing on import and export he's he's got it that's the message it helps both import and export thank you we're gonna go this way have each of you respond just a couple observations one i think on the donor issue and this open source idea i think that's really where you know that was the concern of the developing countries is they didn't have the capacity or the resources to do this this is the opportunity for the donors to coordinate amongst themselves to figure out okay what what commitments these different countries whether regionally or or individually would help advance their development goals the quickest and how can we work together in what the world bank is doing what usa id is doing what the private sector is willing to step in and do so the open source concept is really interesting and i'm glad you you seized on that as well because what you don't want is a bunch of kind of silo donor activities going on that have nothing to do with each other and then developing countries just trying to find somebody who'll pay them to do what they're willing to do but it's not part of any kind of strategy or coordinated approach the other as far as the important the export i think you know when i think about these issues i always focus on how quickly the global supply chain sort of infrastructure has changed and how transformative that has been and how global value chains have disaggregated manufacturing to such an extent that improving your import process will improve your export process i mean it just goes hand in glove and that the real goal is to help more countries fully participate in those global supply and value chains so that may be an overarching concept that can help inform how do they sequence prioritize work together as regions but but that's that's what's going on in the developed economies the emerging economies so that should be the target that informs how you set your prioritization going forward well i think that's a great point um it you know as mentioned uh by some of the speakers that the least developed countries or the developing countries had concerns about signing on to this thing and part of those concerns were that this was going to help the developed countries more than it was going to help them because it would help more imports come into their own countries but then you know they have more foreign imports and then what so i think this import export thing is very important because um as i'll just mention it's going to help set up some of the sequencing because if countries can show that it's easier to import and facilitate the exporting it's going to attract more investment into their countries for the uh and allow them to participate in these greater value change that are growing and and growing so uh and that again is why it's so important to have early participation of the private sector and of organizations that have coordinated private sector thoughts and uh and bring these things together so that as the b and c commitments are are made that uh they're done in a way that uh brings in what is really most needed um in in this area of uh of making sure that the value chain proposition for these developing countries is able to be maximized in the best way process and i also just wanted to comment on what our firm from the Costa Rican embassy had talked about and and it's just such a great example Central America because you've got these uh great countries in and of themselves and how much greater all of Central America could be if the trade even amongst themselves we're not even talking about us just Costa Rica or US Guatemala but the countries amongst themselves could trade more freely and i know when i was uh working for uh a big retailer one of the issues that we had was that we had stores in each of the countries in Central America but we really couldn't have economies of scale going um uh ascending goods between those stores everything had to come back to the US and then to those stores so it really you know it created you know this mess and even for uh being able to send things to uh Central America or bring them from Central America to take to other parts of the world it was a headache because each country had very different uh rules so this also goes back to regionalization and somebody out there made the suggestion of if you get together and approach your commitments for the A B and C's in a regional manner that that could facilitate things but you know as i mentioned that's what makes this agreement different from the FTAs that we had bilaterally is that this agreement has had donors commit to have specific money and so then it's you know being able to use that as effectively as we can okay Ralph uh just just following up on the export question um uh there's actually a catherine man i think it's done a series of studies uh working with the peterson institute and i read these years ago and i was fascinated because what it showed was when a country does autonomous customs modernization improvements on its own the bigger impact that it's that it uh experienced was an increase in exports the export increased greater than imports seems counterintuitive but the reason is if you look at the figures today that the wto has now demonstrated 60 percent of global trade is in component parts these are things moving around as part of a global supply chain that are going into a country to be assembled connected to whatever into something else and then 40 percent of the of the value of every of the average export is imported content so nobody's making things as an island anymore the production chains are global and so if you want to be an efficient exporter you've got to be an efficient importer and and the economic and and and academic data bear that out uh so it's it's a win-win it helps you export it also helps your trading partners access your markets and that makes you a more productive and efficient manufacturer done you get the last word well to touch on a couple of the the issues i heard from the audience and thank you for the great questions you know on the the aid side and just to compliment what Eric and Virginia had said we approached these negotiations from the standpoint that we have a very robust aid structure in place and we have aid effectiveness principles in place and we were not going to recreate the wheel for this agreement given that we have this structure there and it has been effective and we have received positive feedback from the developing countries on this so the mantra throughout the negotiation was always this is going to continue to be a bottom-up demand-driven process that these countries have to have the buy-in rule number one in negotiations is always you can't want it more than they do so these countries had to want this agreement and you know when we would discuss section two we would always go into the negotiations with do you want what is in section one and if you want what is in section one section two is here to help you get it if you don't want what is in section one you need to step up and negotiate what you do want in section one and they're all there at the table and they all can do it and they did I mean we heard I mean there were countries like Comoros the Rwanda Laos Cambodia I mean small countries coming to the table stepping up saying their piece on what they wanted what their national priorities were in this agreement I mean it was great to see that type of participation from these countries that they want to be part of these global supply chains so the buy-in I think is there and you know the resources are there the challenge is coordinating those resources and coordinating the donors and of course the OECD has played a very key role in that and the the WTO has held throughout the negotiations and Virginia has been key at participating in these donor coordination meetings the the international financial institutions and the World Bank the various development banks the IMF have all come out with these op-ed pieces saying they can pay for this the money is there but it's ensuring that all of the donors and the various entities that have this assistance and I think the private sector has a lot to contribute in terms of these best practices and we need to figure out how to tap them into all of this work that is going on to ensure that they are a component part of this the and just you know on the pathways to prosperity it's a great example of how much work is going on and there are these great programs out there that do tie into the the the assistance that's available and I would say that the the CAFTA countries a number of the South American countries were some of the strongest supporters of this agreement recognizing the potential for the regional integration to come from it and on the regional issue and moving forward on a regional basis this does come back to the point that was raised I think by Virginia you know they they there's nothing stopping these countries the you know the east african community secretary it from saying I want to be an observer in the trade facilitation preparatory committee but they have to get their act together and do it the rest of the WTO membership can't do it for them and we can encourage them in that manner but but ultimately they have to do their own coordination efforts and they have to come to the table to press room for that and on the the issue and I really wanted to comment on this the dispute settlement is very hard no really it's not I would I would disagree with that statement um we have never there's never been a case against the least developed country there's never been a case brought against the country that wanted to implement a WTO provision was taking steps to do it and we've been through the negotiations we know that the countries want to implement these if they are taking steps towards implementation and their honest efforts towards implementation there are the resources and there are the mechanisms through the WTO process to help them reach those goals so look forward to working with a number of you in the future on ensuring we reach that implementation point thank you so 500 billion dollars if we get this right there's 500 billion dollars that's four times all the foreign aid that's spent around the world every year so the stakes are big but it's going to require both getting the U.S. governments act together in terms of coordinating resources some of which we're going to have to find it's not as if the aid administrators got a safe in his office and is going to go find this money to pay for this stuff and it's also going to mean how we have sophisticated conversations with local governments local partners on the ground IFI's as well as of course the private sector so this is not a the implementation so this has been hard getting to hear getting the 500 billion dollar prize for developing countries is going to require a long marathon as well so thank you all very much