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G. Srinivasan

NEW DELHI, May 6

DEVELOPING countries exporting textiles confront now a new form of non-tariff barriers (NTBs), which are manifest in the wake of recent concerns about the security of import shipments and those dealing on environmental management systems and social accountability dealing primarily with working conditions.

Official sources told Business Line here that at its recent Cairo meeting, the International Textiles and Clothing Bureau (ITCB) had voiced concern over the latest manifestation of NTBs even as NTBs remain an important area of Doha Development Round on market access. It was emphasised that ITCB members should identify a core list and consider ways for securing their redress.

They said the terrorist attacks of September 11, 2001 gave rise to concerns over the security of global trade, leading to the adoption of various measures, notably by the US. The design and application of these measures could have "profound implications" for traders as well as national governments. The most significant of these measures include (i) the Container Security Initiative (CSI), (ii) the Customs-Trade Partnership Against Terrorism (C-TPAT) and (iii) the requirement for filing of advance information prior to the loading of goods on vessels.

ITCB members felt that these measures carry potentially pronounced implications for developing country exporters and governments. First, the requirement to provide advance information on containerised cargo by electronic means 24 hours in advance of the goods being loaded is a particularly "onerous one". It could have profound impact on time-sensitive cargo, including textiles and clothing. Second, the selection by US Customs of so-called "safe ports" might lead to the re-routing of major flows between certain origins and destinations. In a worst-case scenario, there could be a risk that for lower priced goods, the additional cost might reduce demand for or even make uncompetitive some export products from developing countries concerned.

Third, shippers in developing countries might need to engage inspection firms to certify the safety of containers. Clearly, inspection would be done for a fee to be paid by the shippers, which in turn would need to be incorporated into the selling price or reduce the exporters' margin. The same might hold true if the container is also needed to be scanned and inspected.

Fourth, the screening of containers implies the provision and use of costly equipment for which ports in many developing countries might not be able to raise or allocate the required resources. Finally, the C-TPAT initiative needs trading partners to work with their service providers throughout the supply chain. Various aspects of each stage of the chain must be monitored, including the employees and origin of goods. Although these procedures could be requested only for US-bound goods, they would certainly sway US-based importers, carriers, brokers etc. It is in the light of the Cairo Meeting of the ITCB, members have been advised to inform the business operators of these requirements, discuss their implications and reflect on how best exporters could cope with the new requirements. Alongside, ITCB members should zero in on a core list of non-tariff barriers and discuss ways for securing their solution through the Doha Development Round, the sources added.

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