Madam Speaker, our government strongly believes that trade can serve development objectives by fostering expanded economic opportunity, productivity, and growth in Canada and around the world. The high costs of international trade disproportionately affects developing nations and the least developed countries in particular. Our government is focusing on initiatives that can both support and sustain global growth and poverty reduction, including the ratification of the World Trade Organization's agreement on trade facilitation, known as the TFA.
The TFA would streamline the flow of goods across borders by cutting red tape. It would simplify the documentation required to clear goods at the border and streamline the procedures used by border agencies. All traders would benefit from faster, simpler, and more predictable trade at the border, which translates into lower trade costs. Governments would benefit from more efficient border procedures, fewer opportunities for corruption at the border, and increased revenue collection. Lowering trade costs can increase trade, contribute to a higher national income, and reduce poverty. Countries that do more to lower trade costs, for instance by improving logistics, tend to grow more rapidly.
Most economic gains from the TFA would flow to developing countries, as developed countries, including Canada, are already compliant with the vast majority of the TFA's provisions.
Another benefit of the TFA is that is supports economic diversification in the developing world. TFA implementation could enable developing countries to both expand the types of products exported and the new markets they reach. According to the World Bank, the number of new products exported by less developed countries could increase by up to 35%. Developing economies would require technical and capacity-building assistance to implement the TFA reforms and reap the resulting poverty reduction benefits.
The TFA would allow developing countries to implement the TFA based on their capabilities and to identify their needs for assistance. It also requires developed WTO members to provide the practical support necessary to meet them. In fact, the World Bank has found that trade facilitation projects have some of the biggest returns on investment among development efforts. According to the World Bank, reducing supply chain barriers and speeding up border administration could increase GDP six times faster than tariff elimination.
Canada is well positioned to provide this assistance, having provided nearly $47 million in funding for trade facilitation assistance through a range of bilateral, regional, and multilateral programs from 2010 to 2015. For example, Canada is contributing $12 million in trade facilitation assistance, about 10% of the project's total funding, to the trademark East Africa integrated border management initiative. This initiative will significantly reduce border delays and trade costs between East African Community members—Kenya, Uganda, Tanzania, Rwanda, Burundi, and South Sudan—by establishing a single customs territory and supporting improvements to border and custom management practices.
Prior to this endeavour, multiple customs declarations were required on both sides of each EAC border and clearance and payment of goods could only be completed upon arrival at the destination. Clearing customs was a slow process. This trade facilitation initiative helps integrate customs procedures through automation and the establishment of a one-stop border post. Ports in the EAC now operate 24 hours a day, 7 days a week. As a result, average cargo clearance times have been reduced from three days to eight hours within the EAC.
Results like these have the potential to lift millions out of poverty. TFA implementation could replicate results like these elsewhere.
The TFA's potential will be fully shown when it enters into force. This will only occur once two-thirds of the WTO members have ratified it. To date, 92 of the required 110 WTO members have ratified this agreement. The legislative amendments contained in Bill C-13 would enable Canada to ratify the TFA to help bring it into effect as soon as possible.
To enable Canada to do its part in unlocking the benefits of this agreement, I strongly urge all members of the House to support Bill C-13.