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Trade in Services in Road Transport

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IntroductionTrade in Services andTrade facilitation (difference)SADC Protocol onTiSand Transport and infrastructure (linkage and possible area of synergy)Players in road freight transportationPrivate sector participation in negotiations and regulator negotiatorsKey issues towards liberalization (for private sector and regulators)Policy issuesOffensive and Defensive interest
Introduction
Two interlinked agendas…
Trade Facilitation agenda
“Brick and mortar” Infrastructure issuesRoads infrastructure development, weight bridge calibration, etc.Customs-related issuestransit management stems/ bonds and guaranteesRedtape/documentation (standardization of systems and requirements, )Other standards and requirementsAxle-load issues, vehicle standards & dimensionsRoad safety requirements: abnormal loads, 3rdparty MV insurance, etc.Trade policy: quota restriction administration
Core Trade in Services agenda
Issues relating to discrimination (i.e. locals are favored over foreigners)CabotagerestrictionsRecognitionMultiple Road user chargesIssues relating to investment (establishing businesses abroad)Issues related to driver’s permits-movement of persons
Many of the issues are overlapping !
Key factor for Competence inRoad freight transport
Efficientcustoms clearance process;Qualityoftransportrelated infrastructure;Alternatives/options for shipments;Competenceand quality of logistics services;Abilityto track and trace consignments; andTimely delivery of consignment
Participation in theLiberalization Negotiations
Insufficient and ad hoc consultationPrivate sector and Regulator involvement is necessary & vital particularly in negotiating lists of commitmentCollaboration among Policy Makers, Regulator,and Private sectorIdentify key players and establish consultation mechanism & compose negotiating teamFamiliarize with the Protocol & Guidelines, identify offensive and defensive interestsOffers and requests should reflect your interests,Prepare fall back positions
Key Players in Road freight services
Private sector and Civil societyTransportoperators,Distributors,Freightforwarders,ShippersTransportassociations and NGOs dealingwithTransportConsumersassociationsGovernmentTransport Regulators /National Road AuthoritiesCustomsand borderagencies, local governments,Other Agencies i.e. weights/measurements/standards bureaus, traffic police, etc.
Consultation Mechanism and Composition of Negotiating Team
Consultation MechanismDynamic, all-inclusive and adhere to national decision making structureInvolve all stakeholder (Policy-Regulator-Private sector)Maintain constant and regular feedbackMinimum Negotiating TeamChief Negotiator (s)Sector Ministry, Regulator (s) and LegaladvisorPrivate Sector (national)Regional organizations with observerstutas?
Key issues from SADC Protocol on Trade in Services
Provides for:Most-Favored –Nation Treatment: unconditionally and immediately extend other MS any favorable treatment offered to 3rdpartyNational treatment: non discriminatory treatment among operators (local-foreign) unless otherwise scheduledMutual recognitionof requirements, qualifications, licences and otherregulationsmet/obtained in another MS through an Agreement (to be negotiated)Domestic Regulation: develop disciplines on MSmeasuresrelating to qualification requirements and procedures, technical standards, and licensing requirements and procedures allow for effective marketaccessCallsfor liberalization through schedules ofcommitmentStarting with sixpriority sectors: communication, energy related, finance, construction, tourism and transportation)Calls for effective regulation and transparencythrough prompt publicationofmeasures applicable in services sectors, and by responding to request to share information on the same
Key Issues from Protocol on Transport, Communication and Metrology
Horizontal Commitment on Road Transport Market liberalization to facilitate movement of goods and passengers through development of commercial road transport industry which provides effective transport servicesInternational regulatory mechanismHarmonizationTraffic regulationTransport infrastructureCross border procedures etc.Institutional frameworksFunding mechanisms (infrastructure development)
Identify offensive interests(Private Sector)
Target markets:Which Country?What type of service/ customers?Market access: what market entry restriction do road transport operators face in other MS including:Registration and licensing requirements,Limitations on number of operators?,Joint venture requirement?
Offensive interests (ctd.)
Are there discriminatory measure in the country of interest that are based on nationality? -> e.g. different road user fees/charges, allocation of routes, etc.whatare desirable regulatorychangesin the target market for better market access ? ->Legislation (registration and licensing)Standard documentation
Defensive interest
Are there any measures favoring local suppliers in the home market:do they need to be maintained?For which purpose and how long?Does benefit of maintaining these measures outweigh the costs to consumers (higher prices) plus the maintenance of similar restrictions by other SADC partners?What is the domestic suppliers’ capacity development policy? Empowerment policy?Balanced sequencing of regulatory reforms and market liberalization
Regulators
What national and regional legal frameworks are in place? Are they coherent?What are the market demands?Are existing operators efficient and effective?what reforms are required to match MD?What measures in place to ensure fair competition? Is there capacity to manage the reforms and competition?How to manage abuse ofrights by operators? What is the desired level of control?
Key PolicyIssues Policy
What is the national trade in servicesagenda? policy? objective?What are the sector policy objectives?What is the state of play? What are the services development initiatives?What are the cross-cutting issues? Are they coordinate and coherent? Is there shared understanding across sectors?Sensitivity of the sector and the balance of consumerprotection andbroad-based access, local operator protection Vs.efficiency andeffectivenessWhat other commitment that has been undertaken in the sectors under other agreements? What are options for achieving balanced benefits and simplicity in administering implementation of these agreements?
Key Regional Preparation forTiSNegotiations
Conduct sectorial studies: build on existing (identify restrictions and state of play)Made available in Services websiteCarryout sectorial consultations (national & regional level)Devise mechanism of dealing with horizontal and cross-cutting issues (MRAs, transparency, subsidies, movement of NP etc.)
Conclusion
Liberalization is desirable, thusCapitalize on commitment under the two ProtocolsPolitical backupis necessary to facilitate implementationPrivate sector advocacy for liberalization is importantComplementary efforts are necessary such asAccelerated harmonization of regulatory frameworksInfrastructure developmentTrade facilitation commitment and related implementation
Thank You
By:ViolaSawereTrade Policy AdvisorSADC/GFA Trade in Services Project

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Trade in Services in Road Transport