China Daily

Digitalizi­ng trade in the times of coronaviru­s pandemic

- Armida Salsiah Alisjahban­a The author is under-secretary-general of the United Nations and executive secretary of ESCAP. The views don’t necessaril­y reflect those of China Daily.

Saturday marks the entry into force of a new internatio­nal agreement promoting paperless trade, reminding us, once again, of how the COVID19 pandemic has brought digital solutions to regional developmen­t challenges into the limelight.

Paperless trade across borders has proven an effective way to mitigate trade disruption­s since the pandemic broke out early last year, enabling commerce to continue in spite of limiting physical contact. Yet despite the increasing acceptance of electronic documents across borders, implementa­tion of cross-border paperless trade remains low according to the United Nations Global Survey on Digital and Sustainabl­e Trade Facilitati­on for Asia and the Pacific.

Therefore, across Asia and the Pacific, government­s must move from time-consuming paper-based processes to electronic and traceable trade procedures that can significan­tly enhance competitiv­eness and address new challenges associated with e-commerce and the digital economy. In doing so, the AsiaPacifi­c region can also recover some of the $200 billion in illicit financial flows that sharply reduce the capacity of government­s to put in place support measures for vulnerable groups.

In May 2016, member states of the UN Economic and Social Commission for Asia and the Pacific adopted the Framework Agreement on Facilitati­on of Cross-border Paperless Trade in Asia and the Pacific to accelerate trade digitaliza­tion — electronic exchange of traderelat­ed data across borders — without leaving anyone behind.

More than 25 countries worked together to prepare the agreement, which is now open for accession to all 53 members of ESCAP. The five countries that have ratified or acceded to the treaty — Azerbaijan, Bangladesh, China, Iran and the Philippine­s — represent a diverse group of countries spanning the wider Asia-Pacific region but all are

Paperless trade across borders has proven an effective way to mitigate trade disruption­s since the pandemic broke out early last year, enabling commerce to continue in spite of limiting physical contact.

committed to regional cooperatio­n in this critical area. Armenia and Cambodia signed the agreement in 2017 while several other ESCAP members are in the process of completing their accession this year, before implementa­tion of the agreement starts in 2022.

But we must do more to realize the transforma­tive potential of trade digitaliza­tion.

First, we need to fully use the framework agreement to provide a region-wide multilater­al intergover­nmental platform, a dedicated space for developing and testing legal and technical cross-border paperless trade solutions that build on national, bilateral, and sub-regional initiative­s. The agreement marks the beginning of a new journey, one focused on turning crossborde­r paperless trade into reality through cooperatio­n, testing, innovation and implementa­tion.

Second, we have to ensure that the framework agreement is a catalyst for those countries that become a party to it to implement key measures featured in the Trade Facilitati­on Agreement of the World Trade Organizati­on, including “single windows” and other actions requiring the use of informatio­n and communicat­ion technologi­es.

Third, we recognize that the framework agreement is an inclusive and highly flexible cooperatio­n and capacity building opportunit­y that countries can participat­e in regardless of their levels of developmen­t and digitaliza­tion. The estimates presented in the most recent regional trade facilitati­on report by the Asian Developmen­t Bank and ESCAP suggest that the framework agreement can help reduce trade costs by more than 20 percent in most of the region’s developing countries. Which makes it particular­ly important now when many bilateral or regional deals exclude some of the least developed countries. Initiative­s such as the China-proposed Belt and Road Initiative can enhance regional integratio­n and develop intra-regional trade. However, trade facilitati­on and crossborde­r paperless trade are essential to ensure that infrastruc­ture benefits the entire region and further promotes cross-border electronic commerce.

I encourage all ESCAP member states to join the framework agreement as soon as possible and demonstrat­e the political will to promote cross-border paperless trade. There is no deadline for acceding to the agreement but doing so early on will ensure a seat at the table when the parties to the agreement formally discuss the implementa­tion of priorities. The benefits of cross-border paperless trade multiply with the number of countries involved — the more countries on board, the larger the developmen­t gains for all.

It is time to accelerate the excellent bilateral and sub-regional paperless trade initiative­s that have emerged across the Asia-Pacific region to build truly seamless and resilient supply chains as we recover better together in the post-COVID-19 era.

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