In the past few years, multiple shocks ranging from pandemics to conflicts have restricted the movement of goods and services, resulting in the number of countries facing significant disruptions in supply chains is increasing every year, affecting timely delivery of essential goods, such as food and pharmaceuticals. As such, pressures on global supply chains were among key topics discussed during the World Trade Organization’s Ministerial Conference (MC12) in June 2022.
As the world set foot on the recovery path from the still ongoing COVID-19 pandemic, a new challenge in the form of the war in Ukraine resulted in a sharp decrease in trade, investment, and supply chain shortages globally, adding to already growing inflation and price rises. The World Bank’s recent study on the impact of the Ukraine war on global trade and investment revealed that the conflict has become the main cause of the disruptions in commodity markets, logistic networks and supply chains, among other issues.
Global growth is projected to slow from an estimated 6.1 percent in 2021 to 3.6 percent in 2022 and 2023, according to The International Monetary Fund. A key ongoing challenge for the global community will be to ensure sustainable recovery and to enhance resilience of supply chains to future economic shocks. As highlighted in the UN Global Survey on Digital and Sustainable Trade Facilitation, COVID-19-related international supply chain disruptions and the recent surge in shipping costs have put additional pressure on importers and exporters, thus reinforcing the importance of trade facilitation, particularly in developing and emerging countries.
The United Nations Economic Commission for Europe (UNECE) in line with its mission of promoting economic integration has been supporting its member States with addressing disruption in supply chains. One of its subsidiary bodies, the United Nations Centre for Trade Facilitation and Electronic Business (UN/CEFACT) develops recommendations and electronic business standards for facilitating national and international transactions with the goal to simplify and harmonize international trade transactions and relevant information flows. In the times of public health crises, conflicts, and related supply chain disruptions, UN/CEFACT standards and recommendations are more relevant than ever and several of them have been developed to support relevant policy actions.
One example is in supporting the supply chain in disaster relief efforts in response to humanitarian crises, such as resulting from the war in Ukraine, from where more than 6 million refugees have been recorded across Europe since 24 February. UN/CEFACT constantly supports activities dedicated to improving the ability of business, trade and administrative organizations to respond the crisis and disaster situations, providing recommendations, standards and guidance material.
In this context, the UN/CEFACT Recommendation 44 on Cross-Border Facilitation Measures for Disaster Relief, developed in close collaboration with UN Office for the Coordination of Humanitarian Affairs, and with significant contributions from the International Committee of the Red Cross, the World Customs Organization, and the UN Conference on Trade and Development is as relevant as ever. This policy recommendation advocates the importance of building national capacity and capability to cope with a large influx of humanitarian relief for governments and supports governments by providing key considerations and practices for implementing preparedness measures for the facilitation of a large influx of humanitarian relief after a disaster.
UN/CEFACT is constantly working on providing recommendations for efficient crisis response. When the COVID-19 crisis broke out in 2020, UN/CEFACT released its Recommendation 47 on Pandemic Crisis Trade-Related Response, which outlines measures to mitigate the adverse impact of the on-going public health crisis on trade flows.
Moreover, UNECE has been working closely with its member States as part of efforts to strengthen their trade capacity, advance exports, support integration into regional and global value chains and expand market access. In the context of disruptions in global value chains and particularly trade in pharmaceuticals, as seen during the COVID-19 crisis, a recently conducted Business Process Analysis (BPA) on export of pharmaceutical products from Georgia to Central Asian countries reviewed the pharmaceutical sector in Georgia and identified potential procedural bottlenecks for exporting pharmaceutical products from Georgia to Central Asian countries. The Analysis offers concrete solutions in trade-related regulatory and commercial procedures, replicable for other countries in the region. Recommendations of the report include promotion of digitalization and simplification of processes, strengthening capacity at border crossing for better understanding of processes, and conformity with international standards.
Another example is UNECE’s long-standing collaboration with the Kyrgyz Republic, which is supported by policy advice aimed at harnessing trade facilitation potential. The trade disruptions caused by the COVID-19 crisis have put a spotlight on the importance of trade facilitation measures, leading to designing the National Trade Facilitation Roadmap of the Kyrgyz Republic 2021–2025 aimed to promote economic development in support of the 2030 Agenda. This Roadmap provides a framework to overhaul the country’s trade facilitation reforms and represents a strategic vision. Among activities of the Roadmap are the Business Process Analysis devoted to the Export of textile products and the Business Process Analysis on Import of pharmaceutical products . Among key findings of those BPAs are a high volume of documents involved in cross-border trade and long transit time. These studies make the process transparent by outlining the export steps, requirements and regulations as well as identifying the bottlenecks and time-consuming steps. The BPAs provide recommendations for procedure simplification, outlining the latest developments in the relevant industries. Proposed solutions and recommendations are at the core of UN/CEFACT activities and in line with UNECE upcoming 70th Commission session focusing on “Digital and green transformations for sustainable development in the UNECE region”.
UN/CEFACT has been performing as an expert platform for developing and maintaining recommendations and standards for international trade and facilitation implementation, which are implemented globally. UNECE's practices serve to simplify and harmonize international trade procedures and information flows for the governments. Following its recommendations and standards means paving the way to national and global trade facilitation and moving towards an e-business model.
Looking ahead, UN/CEFACT will convene for its twenty-eighth Plenary Session on 10-11 October 2022. During the Session, UN/CEFACT will cover the development process of its recommendations and standards as well as discuss potential capacity building and technical cooperation. Special attention will also be devoted to future challenges in trade facilitation and electronic business.