G)

ITC IN ACTION
impediments to trade that the business sector faces when complying with these measures. In order to better identify and understand fhe impact of NTMs and other obstacles to trade on businesses, ITC is currently implementing representative company surveys in 10 developing countries. Initial findings of the ongoing survey indicate that the impact of NTMs on exporters varies according to the country. For example, in Burkina Faso 70% of interviewed compames reported that NTMs strongly affect their daily operations, compared to only 24% in Hong Kong (China). From the perspective of individual companies, the survey has also demonstrated that NTMs can be experienced as barners to trade for a number of reasons, such as the company may not be aware of the requirement; the regulation may be so strict that a company may not be able to comply with the requirement without significant changes to production processes; or the cost to demonstrate compliance may be prohibitive to the company For example, a company required to test products in a specific laboratory located in a third-party country or obliged to obtain and translate a certain health certificate from a loc al institution faces time-consuming and often costly compliance procedures. These 'procedural obstacles' include a wide range of constraints ranging from administrative burdens and time delays to the lack of legal protection and attitude of officials in fhe home country, export destination and transit countries. According to preliminary results from the survey m Burkina Faso, more than 50% of the 74 companies interviewed experienced trade barriers linked to domestic challenges. Similar preliminary results were found among other surveyed countries. Other obstacles not directly linked to NTMs related to transportation, the business environment and security. Results from a 2008-2009 pilot survey, jointly executed by UNCTAD and ITC, demonstrated that technical measures - including both sanitary and phytosanitary measures and technical barriers to trade - are a major concern for exporters. The survey found that 72% of all companies questioned in six developing countries reported concerns about technical measures. Many of the concerns related to mandatory quality standards about product characteristics or associated production processes. The most burdensome requirements for exporters were the compliance with certification requirements (20%); labelling, marking and packaging requirements (12%); traceability requirements (9%); and tolerance limits for

non-tariff measures & TECHNICAL REGULATIONS

The challenges of compliance for exporters

CAROLIN AVERBECK 8i OLGA SKOROBOGATOVA

Market Analysts
ITC

A three-year ITC survey across 30 countries is seeking to identify and understand the major obstacles to trade faced by export businesses in meeting non-tariff measures (NTMs) and technical regulations.
xporters and trade policy-makers in developing countries are increasingly concerned about NTMs applied by des^ ^ ^ tination markets. These include a wide range of trade measures that are related to export, including technical regulations and other mandatory standards. They may vary across products and countries, and can change frequently While many NTMs are applied for legitimate reasons, others can be barriers to trade. Many exporters in developing countries lack the information, capabilities and facilities to meet these complex requirements. In addition, compliance with NTMs can reduce export competitiveness by adding exfra fime and cost to the production of goods. At the same time, many national policy-makers lack a clear picture of the

'See also Obstacles to Trade Irom the Perspective of the Busmess Sector : A Cross-Country Comparison' by MondherMimoum, Carolin Averbeck, Olga Skorobogatova, in The Global Enablmg Trade Report 2009. World Economic Forum, Geneva, Switzerland, 2009, 'Ibid

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residues and contaminants or res-tricted use From the of certain substances (8%). ITG will implement NTM surveys m some perspective 30 countries between 2010 and 2012 with the of individual companies, aim of identifying and understanding the most the surveychallenging NTMs for businesses in relation to has also products, sectors and export markets at country demonstrated level. The business perspective on the issue of that NTMs can NTMs IS indispensable in the identification and be experienced definition of national strategies to overcome as barriers obstacles to trade. The understanding of their to trade for key concerns and daily challenges with regard a number to NTMs helps governments better define the of reasons. needs for concrete action and capacity building - particularly in the area of technical regulations, sanitary and phytosanitary regulations, conformity assessment and related technical assistance. ITG is also engaged in a multi-agency framework under UNGTAD's leadership to collect, classify and disseminate regulatory information on NTMs applied by importing countries, both developed and developing, in order to provide exporters and others with easy access to this information. Detailed results of the survey will be published in the TC Flagship Publication 2010 and Country Reports (ITC Technical Paper Series on Non-Tariff Measures) later this year.
For more information, contact ntm@intracen.org.

FIGURE 1

Share of reported technical measures

CERTIFICATION REQUIREMENTS

8 9%
TRACEABILirY REQIIREMNTS

LABELLING, MARKING AND PACKAGING REQUIREMENTS

TOLERENCE LIMITS FOR RESIDUES

46%
OTHER TECHNICAL MEASURES TESTING REQUIREMENTS

NTM INCIDENCE

By exporting company size, 2010

AFFECTED EXPORTER COMPANIES (SHARE %) Burkina Faso Hong Kong (China) Morocco Paraguay Peru Sri Lanka Note: Figures are based on the reports by exporting companies in Chile (673 reported NTM cases), India (776), Philippines (851), Thailand (1803), Tunisia (810) and Uganda (593). Percentages represent shares of the groups of NTMs in the total number of NTMs, averaged across the six countries surveyed. SCREENED EXPORTER COMPANIES (NUMBER)

61 24 32

100 1,701 220 210

64
44

588

Afoie; Results are prehminary as the 2010 NTM surveys are still in progress.

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FORUM ISSUE 3 2010

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