Nepal can leverage implementation of TFA to attract more investment into the economy



Himalayan News Service

In today’s world, where international trade is increasingly conducted in fast-paced global value chains, time is of the essence. The speed at which a product is brought from the factory in the country of origin to the shelves in the destination market is of paramount importance for buyers and consumers, who demand just-in-time delivery and reliability of trade processes. However, the cost factor is also a crucial element that determines the competitiveness of a product and, subsequently, of firms, especially small and medium enterprises (SMEs).

According to estimates of the WTO, in developing countries, for each US dollar it costs to make a product, it costs a further $2.19 to bring it to consumers, compared to developed countries where this cost is reported at $1.34. Cross-border inefficiencies, captured by direct and indirect costs that traders need to bear for exporting or importing their goods, have thus an enormous impact on the business competitiveness and, at large, on the trade environment of a country.

This is where the trade facilitation concept comes into play to make a difference for efficient and competitive businesses. In its broadest sense, trade facilitation is a comprehensive set of actions to reduce the time and cost of cross-border trade. It involves reforms in border and behind-the-border operations, including the reliability, predictability and efficiency of transportation infrastructure and logistics operations, as well as of customs and border management regulations and procedures.

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