A TRADE EFFICIENCY
SUB-REGIONAL PROJECT PROPOSAL
FOR INCREASED PARTICIPATION IN INTERNATIONAL TRADE
INTEGRATION OF COASTAL WEST AFRICA
IN THE GLOBAL TRADE POINT NETWORK
(1st Phase)
UNITED NATIONS CONFERENCE
ON TRADE AND DEVELOPMENT
Special Programme for Trade Efficiency
July 1995
CONFERENCE DES NATIONS UNIES SUR UNITED NATIONS CONFERENCE
LE COMMERCE ET LE DEVELOPPEMENT ON TRADE AND DEVELOPMENT
A TRADE EFFICIENCY
SUB-REGIONAL PROJECT PROPOSAL
Title: Integration of Coastal West Africa in the Global Trade Point Network (1st phase: four selected countries)
1. SUMMARY
This project is part of the immediate follow-up to the United Nations International Symposium on Trade Efficiency (UNISTE), held in Columbus, Ohio (United States) in October 1994. The Columbus Ministerial Declaration invited the international community to provide substantial and rapid technical and financial assistance to developing countries and countries in transition for the establishment and internetworking of Trade Points, as well as the implementation of the Trade Efficiency recommendations and guidelines.
The preparatory work for UNISTE and the discussions held in Columbus led to (1) the identification of practical solutions to the obstacles to greater participation of the weaker players (including developing countries and small and medium-sized enterprises worldwide) in international trade and, (2) the creation of a very broad political consensus around those solutions and the need for their implementation. The Trade Efficiency guidelines and recommendations could, if put into practice, yield up to $ 100 billion of reductions in transaction costs in the next five years. The Global Trade Point Network, which is the main instrument in the process of trade efficiency implementation, is expected to emerge as one of the world's main vehicles for the dissemination of trade information and better business practices in the years to come It will constitute a pivotal mechanism in the fight against exclusion from international trade.
The overall objective of this project is to facilitate the participation and integration of Coastal West African countries in international trade, including intra-regional (South-South) trade. Four countries of Coastal West Africa (which includes Benin, Côte d'Ivoire, Guinea-Conakry, Guinea Bissau, Ghana, Liberia, Nigeria, Sierra Leone and Togo) will be selected for the establishment of a Trade Point. Their results will contribute to the establishment of Trade Points in the rest of the sub-region to be pursued through a follow-up project which will be prepared in due course by UNCTAD.
At a first stage, Trade Points will be 'physical', i.e. they will offer services for trade at their premises, the final objective being to become virtual Trade Points electronically linked to their users, at least in the most technologically-advanced countries. Wherever possible, Trade Points will be fully connected to the Global Trade Point Network; basic connectivity (e-mail/EDI) will be provided for all selected countries. Trade Points will be assisted in taking roots in their socio-economic environment and offering the most appropriate services at a reasonable cost, thus facilitating their task of inciting more actors - particularly small- and medium-sized enterprises (SMEs) - to participate in international trade. A particular effort will be made to assist micro enterprises through the cooperation with NGOs and other institutions operating locally for the integration of the informal sector in trade.
This project will also contribute to the development of Trade Points' capacity to progressively expand their functions from trade facilitation (better business practices) and business information dissemination to other trade-supporting services, including trade financing, banking, insurance, Customs, transport and telecommunications. This will be done mainly through the progressive implementation of the sectoral recommendations adopted by the United Nations International Symposium on Trade Efficiency and annexed to the Columbus Ministerial Declaration.
The project will have a strong human resource component through the development and delivery of training programmes adapted to the needs and requirements of Trade Point managers, service providers and clients in the Coastal West African countries.
This sub-regional project is part of a larger Trade Efficiency initiative aimed at the creation and operational launching of Trade Points in each of the ACP countries. It is a pilot project, which will be followed by other proposals for the other Coastal West African countries, and for the countries of Sahel, Central Africa, East Africa, Southern Africa, the Indian Ocean, the Caribbean and the Pacific. It will be implemented in coordination with other UNCTAD programmes operating in Africa, such as ASYCUDA, ACIS and TRAINFORTRADE, and in cooperation with ITC, UN-ECE, ECOWAS and other regional institutions likely to contribute to the building of the Global Trade Point Network.
2. BACKGROUND
The Trade Efficiency Initiative was launched by the Eighth Session of the United Nations Conference on Trade and Development in Cartagena de Indias, Colombia, in February 1992. The Conference also agreed to convene the United Nations International Symposium on Trade Efficiency (UNISTE), which was held in Columbus, Ohio (United States) in October 1994.
A central objective of the Trade Efficiency Initiative is to assist and facilitate the integration and participation of developing countries and economies in transition, as well as of SMEs worldwide in international trade. This objective is pursued in particular by simplifying and harmonizing trade procedures worldwide and providing traders access to better business practices. In this context, access to competitive information technologies and information networks is a vital intermediate objective.
The work carried out within the Trade Efficiency Initiative allowed the identification of six areas of work in which obstacles for the participation of developing countries and SMEs in international trade could be removed. An estimation of the likely reduction in transaction costs puts the figure at US$ 100 billion until the year 2000. A set of practical solutions, contained in the 'Recommendations and Guidelines for Trade Efficiency' obtained universal political support in Columbus. That political will must be complemented now by the technical assistance for the implementation of those solutions.
The main practical tool for this is the Trade Point. Trade Points are catalysts for change, introducing better business practices in all trade-related areas: Customs, banking and insurance, transport, etc. They offer access to the latest trading techniques including electronic trade and electronic data interchange (EDI) for Customs, banking, and transport.
Trade Points take advantage of the fast-declining costs of information and telecommunications technologies. No expensive infrastructure is necessary to establish a Trade Point. A Trade Point can be installed and delivering minimum services in an relatively short time. The technologies are increasingly powerful and user-friendly, allowing training to be focused on substantial rather than instrumental aspects. This is particularly important for a project like this one, which addresses the situation of very poor countries with very scarce infrastructures.
As of 15 May 1995, 84 Trade Points had been or were being established in 55 countries, while another 41 official requests had been submitted to UNCTAD. Most of the African countries have also requested UNCTAD's technical assistance in the establishment of the Trade Points.
In order to respond to these requests, the UNCTAD Secretariat is now focusing its efforts on ACP countries, particularly on Africa. This project for four Coastal West African countries is a pilot one which will be followed by other proposals for the rest of Coastal West Africa, Sahel, Central Africa, East Africa, Southern Africa, the Indian Ocean, the Caribbean and the Pacific. The final objective is to have at least one Trade Point established and fully operational in each of the ACP country.
(For a more detailed description of the Trade Point Programme, see Annex I.)
2.1 GOVERNMENT/SECTORAL POLICY
African countries have been affected in various degrees by the current trends of global trade liberalization and increased reliance on market-oriented economic policies. However, other tendencies that are shaping the international trade system are yet to reach them, particularly (1) the emergence of new trading blocks and the strengthening of already existing ones and (2) the rapid and deep effects of technological changes in trade and competitiveness patterns. While the first of these trends offers promising perspectives for the developing countries, the other two pose formidable threats to these countries. Assistance from the European Union remains an important potential factor to reverse these tendencies.
At the national level, governments have become generally aware that they have much to gain from an outward-looking approach: most of them have embarked on structural adjustment programmes which include substantial trade liberalization. Some have undertaken the difficult process of shifting from a centralized to a market economy. More attention is being devoted to the identification of new market opportunities and stimulating private sector participation in trade. Continuous efforts are being pursued to facilitate trade through the simplification and
harmonization of procedures, as well as through sector-specific programmes such as Customs automation.
But the success of these initiatives will be evident only in the medium term, whilst the cost in terms of structural adjustment programmes, employment losses in privatized industries, fiscal restraint and the cost-of-life effects of currency devaluation are felt immediately. Social unrest has been present in these countries in recent years, and the continuity of the process of economic reform and liberalization will depend on the governments' ability to offer some prospects of economic take-off and employment creation. Increased participation in international trade should be a key element in this process.
At the regional level, economic integration processes are under way. All Coastal West African countries (Benin, Côte d'Ivoire, Guinea-Conakry, Guinea Bissau, Ghana, Liberia, Nigeria, Sierra Leone, Togo) belong to the Economic Community of West African States (ECOWAS). Other groupings include the West African Economic Community (Benin, Côte d'Ivoire), and the Mano River Union (Guinea-Conakry, Liberia, Sierra Leone). Some countries also belong to the Union économique et monétaire ouest-africaine (UEMOA). Other initiatives like the Enterprise Network of Western Africa aim at creating intra-regional links in the private sector. The results in terms of economic integration of the above mentioned groups are for the moment quite limited and could benefit from the synergies and networking effect of the integration in the Global Trade Point Network.
At the interregional level, African countries rely significantly on cooperation efforts provided by the European Union under the Lomé IV Convention, which places strong emphasis on the importance of trade in economic development and commits the EC to stimulating ACP export promotion. Title X (Articles 135 to 138) commits the contracting parties to "implement measures for the development of trade at all stages up to final distribution of the product". Article 136 states that "particular attention shall be given to operations designed to increase the ACP States' self-reliance, develop intra-ACP trade, trade to international markets and improve regional cooperation in trade and services". It specifies a number of target areas for operations including human resources development and support to small and medium-sized enterprises wishing to export. In Annex XX attached to the Lomé IV Convention, the EC and ACP States "recognize the potential in developing export promotion or marketing techniques for the improvement of the export performance of the ACP States" and reaffirm the need to emphasize trade and services development in national and regional aid programmes.
2.2 FEATURES OF THE SECTOR
Participation of African countries and particularly of Coastal West Africa, in international trade is small. These countries represent a sizeable share of African population (24%) and of its GNP (around 15%). The share of Coastal West African countries in Sub-Saharan Africa's total exports and imports was 24% in 1992. The trend - as in most of Africa - follows a pattern of continuing trade marginalization. The share of Coastal West African countries in total world trade has fallen from 0.77% in 1970 to 0.25% in 1992, a decrease of 67%. Despite the preferential trading arrangements under the Lomé Conventions, exports to the EC/EU have failed to keep up with the growth of EC/EU trade. When the first Lomé Convention was signed in 1975, ACP exports made up 3.4% of total EC imports. By 1985, this figure had fallen to 3.2% and further to only 1.5% in 1992.
Apart from the well-known macroeconomic reasons (e.g., price of exported commodities and overvalued exchange rates), part of this poor export performance is due to the inefficiency of the overall trading process: cumbersome procedures, uncertain or misleading information, unreliable transport, complicated Customs etc. These problems are examined in more depth in section 2.4.
In the coming years most of the variables that will affect the trade performance of the Coastal West African countries - and of African countries in general - will be external factors, or at least not completely in their control: the consequences of the Uruguay Round agreements, the medium-term effects of the CFA franc devaluation, the emergence of new trade blocks in Europe, America and Asia. There are risks and opportunities for these countries in each of these phenomena. To realize opportunities and dispel risks, these countries will need access to proper information, training and trading techniques. A main target for such efforts should be the small- and medium-sized enterprises, including the large part of these economies that is comprised in the informal sector. They represent the bulk of domestic production and employment in these countries, but traditional trade promotion strategies are not well adapted to their needs.
2.3 BENEFICIARIES AND PARTIES INVOLVED
The ultimate beneficiaries of this project will be the enterprises of the participating Coastal West African countries involved directly or indirectly in international trade (especially small- and medium-sized enterprises), as well as the administrations and enterprises offering services for trade transactions (Customs, banks, transports, telecommunications, e.g.). With regard to the specific activities to be developed under this project, immediate target beneficiaries include:
- Trade Point staff, who will be trained and equipped to become fully operational as early as possible in the lifetime of the project;
- managers and employees of local SMEs and micro enterprises. Through the assistance and services received from Trade Points, they will have a greater opportunity of effectively and competitively participating in international trade; they will also be among the main beneficiaries of simplified and harmonized trade procedures, as well as of the adoption of better business practices by the administrations and trade-supporting service industries in their countries;
- the local trading communities at large, who will gain access to Electronic Trading Opportunities (ETOs) and other trade-related data-banks, and the ability to deal with new trading partners in all parts of the world through the Global Trade Point Network (GTPN);
- the Governments of the participating Coastal West African countries, through the introduction of trade efficiency measures resulting in reduced trade transaction costs, increased trade and a more selective though more effective collection of duties;
- trade-supporting service industries (banking, telecommunications and transport inter alia), who will become more efficient through the use of better business practices, modern technologies and increased cooperation with other local industries.
The parties involved will include first and foremost the local enterprise sector and its structures (e.g., chambers of commerce, clubs of exporters), but also the public entities involved in trade (Government, administrations, public institutions operating in trade promotion and trade facilitation). Existing Trade Promotion Organizations (TPOs), NGOs dealing with trade, and trade facilitation organizations should be involved in setting up the Trade Points. In addition, all trade supporting service activities (Customs, banking, insurance, transport, telecommunications, e.g.) should be involved through their respective enterprises or representative organizations.
2.4 PROBLEMS TO BE ADDRESSED
2.4.1 Providing practical tools for outward-looking development strategies
Over the last twenty years, many African countries have undergone difficult and painful adjustment processes in the midst of a less than supportive international environment, aggravated by lasting problems (indebtedness), economic dependence (e.g. on a limited number of commodity exports), and natural hardship (droughts) and military conflict. At the same time, many of them have launched courageous efforts to reform their economies, with greater reliance on market forces and trade openness. More recently, some political systems have moved towards open and pluralist regimes.
The sustainability of such reforms is at stake. In a politically open society, reformers need tangible results to offer to constituencies. The opportunities offered by the new trading environment created by the successful conclusion of the Uruguay Round and by information and telecommunications technologies, will not be seized if local traders remain faced with the technical, and regulatory obstacles which have traditionally prevented them from competing in international markets. Coastal West African countries need to make a great effort in order to simplify trade, allow enterprises to export more competitively and import on better terms. At the same time, at the Columbus Symposium consensus was built around several hundreds of recommendations which now are awaiting global implementation in the six vital sectors of trade efficiency: Customs, business practices, banking and insurance, business information, transport, and telecommunications. As the world progressively starts to adopt these recommendations, African countries, and in particular the Coastal West African ones, should not be left behind.
2.4.2 Preventing exclusion from the electronic marketplace
In a global marketplace information becomes the most important strategic tool for traders. The most striking inequality between traders in developing and developed countries is the one that affects access to information. Millions of potential traders cannot realize their competitive advantages simply because they do not have access to trade-related information: they do not know where are the markets for their products, or they cannot make their products known to would-be customers. This is particularly true of traders in Africa, whereas traders in the developed world have access to commercial data-banks and to a growing number of customers just by connecting their computers to the telephone lines.
The trend towards paperless trade, based on electronic data interchange (EDI), is unstoppable. EDI permits enormous savings in time and money and gives user countries and firms a clear edge on their competitors. Moreover, EDI permits instant identification of import/export opportunities, and the creation of links between potential importers and exporters.
Again, this creates opportunities, but also risks. EDI reduces distances and transaction costs, thus contributing to the integration of developing countries in international trade. But it also introduces the risk of exclusion of those who do not have access to this new electronic marketplace. Already certain firms have explicitly indicated a refusal to deal with firms not using EDI. The danger is most serious for small enterprises throughout the world and particularly in developing countries: EDI is virtually unknown among them, and the lack of the necessary technical means and training is blatant.
Businesses in Coastal West Africa are handicapped by extremely difficult and expensive telecommunications: the cost of international telephone calls there can be up to 500% higher than in developed countries. The number of telephones per 100 inhabitants can be as low as 0.1. Access to international electronic networks such as the Internet is severely limited. Facilities like full IP Internet connection, Value Added Networks (VANs) nodes (e.g. AT&T), or packet switching data networks (PSDNs) are for the most part non-existing in these countries. This lack of easy and affordable access to electronic networks is a huge barrier for enterprises who need quick and accurate information on markets and trade opportunities.
Traders in Coastal West Africa are often isolated from the world trading community. They lack access to relevant information as well as contacts with traders in other parts of the world. A more effective dissemination of trade-related information throughout Coastal West African countries is needed, but the effective use of such information by traders requires in addition that (1) equipment be made available to collect, receive and process such information, (2) software be designed and installed to address specific local needs of traders, and especially SMEs, (3) local personnel be trained to use the relevant techniques and disseminate corresponding practices, and to translate them into a higher level of participation and competitiveness in international trade. And that is what the Trade Point Programme can offer to Coastal West African countries.
2.5 OTHER INTERVENTIONS
This project responds to the need for greater emphasis on the development of trade and services mentioned in Annex XX to the Lomé IV Convention and will be a sub-regional complement to the EU Trade Development Project in its aim to improve the relative ACP trade performance with the EU and other partners. The two projects will be mutually reinforcing as the TDP will provide for Trade Policy Development, Products and Markets, and Trade Information while the Trade Efficiency/Trade Point project will foster trade facilitation efforts and enhance the capacity of local enterprises to access and use trade-related information and the techniques of modern international trade.
This sub-regional project is part of a larger Trade Efficiency initiative aimed at the creation and operational launching of Trade Points in each of the ACP countries. It is a pilot project for four Coastal West African countries, which will be followed by other proposals for the rest of Coastal West Africa, and for the countries of Sahel, Central Africa, East Africa, Southern Africa, the Indian Ocean, the Caribbean and the Pacific. This project will maximize potential synergies with other technical assistance projects in trade efficiency at the regional and inter-regional level, particularly in terms of development of software products adapted to the needs of Trade Points. Therefore, it will be implemented in coordination with other UNCTAD programmes operating in Africa, such as ASYCUDA, ACIS and TRAINFORTRADE.
This project will also increase interest for and impact of efforts pursued by the United Nations Economic Commission for Europe in the area of trade facilitation and 'better business practices', including through the dissemination of international EDI standards such as UN-EDIFACT and by the International Trade Centre (ITC UNCTAD/GATT) in the area of trade information. In particular, the ITC has started an EU- and UNDP-supported programme for the promotion of intra-ECOWAS trade, and trade information related technical cooperation projects in a number of Coastal West African countries including Côte d'Ivoire, Ghana and Sierra Leone.
2.6 DOCUMENTATION AVAILABLE
The Trade Point Programme is part of the Trade Efficiency Initiative launched by UNCTAD VIII (Cartagena de Indias, February 1992). The Analytical Report by the secretariat to the Conference, (UNCTAD document TD/358) deals in its paragraphs 426-460 with the issue of enhancing efficiency in international trade and its relationship with development. Paragraphs 156 to 161 of the Cartagena Commitment (TD/346/Rev.1) call for the identification of 'areas in which technical cooperation could be necessary in trade-efficiency-related areas, with special regard to trade facilitation activities and the establishment of Trade Points'.
The Ad Hoc Working Group on Trade Efficiency, established in May 1993, devoted a significant part of its attention to the Trade Point programme. The report of its first session (TD/B/WG.2/3) states the aim of the Trade Point programme as 'fostering greater participation in international trade, in particular small and medium-sized enterprises, giving special attention to countries and regions less advanced in the area of trade efficiency'.
The reports of the second (November 1993) and third (May 1994) sessions of the Ad Hoc Working Group (UNCTAD documents TD/B/WG.2/9 and TD/B/WG.2/13) contain evaluations of the Trade Point programme. The final report of the Ad Hoc Working Group (TD/B/40(2)/L.6) includes a status report of Trade Points as of May 1994.
On the occasion of the second session of the Ad Hoc Working Group, the Secretariat produced two documents: 'First evaluation of the Trade Point programme: Interim report' (TD/B/WG.2/7) and 'The Trade Point: Concept and implementation' (TD/B/WG.2/7 Add.1). The first describes the approach followed by the Secretariat in responding to the fast growing number of requests of Trade Points; the second defines the fundamental objectives and nature of the Trade Point programme.
Document TD/SYMP.TE/2 'Recommendations and Guidelines for Trade Efficiency: Background document prepared by the UNCTAD secretariat' was used as a basis for the discussions of the Ad Hoc Working Group on Trade Efficiency and of the Preparatory Committee for the United Nations International Symposium on Trade Efficiency (UNISTE). The document contains inputs from the Customs Co-operation Council (currently World Customs Organization), and of the ITC UNCTAD/GATT. Document TD/SYMP.TE/2 'Compendium of trade facilitation recommendations' was prepared by the UNCTAD secretariat in cooperation with the Working Party on Facilitation of International Trade Procedures of the UN-ECE.
The United Nations International Symposium on Trade Efficiency was held in Columbus, Ohio (United States) from 17 to 21 October 1994. The Symposium adopted the Columbus Ministerial Declaration (TD/SYMP.TE/6, Part I) and noted the summaries presented by the President of the Ministerial Segment (TD/SYMP.TE/7) and the Chairperson of the Senior Officials Segment (TD/SYMP.TE/6-Appendix to the Ministerial Declaration), and decided to transmit them to the UNCTAD Trade and Development Board. These three documents refer to the Trade Point programme and to technical assistance matters in the field of Trade Efficiency. The Symposium decided to transmit the Columbus Ministerial Declaration and the supporting guidelines and recommendations for trade efficiency to the General Assembly of the United Nations.
During the preparatory process for UNISTE, several reports were commissioned by the UNCTAD secretariat to consultants. Two of them are 'Trade Efficiency and convergence of information flows', a report by E. Dreyfous, October 1991, and 'Information and telecommunications: Infrastructure policies for trade efficiency' by Michael Jenkins, Centre for Information and Communications Technologies, University of Sussex, 1993. Also on the question of information superhighways and trade efficiency 'Trade Efficiency and Global Information Highways', by Jean Gurunlian, Executive Secretary of UNISTE, in Actes des 16èmes Journées Internationales de l'IDATE, Montpellier 1994. Fact sheet # 5 of the press background documentation for UNISTE 'Saving one hundred billion dollars annually by the year 2000' contains details on how the implementation of the trade efficiency programme can contribute to a better global resources allocation.
In January 1995, the Secretariat produced a paper entitled 'The Trade Point Programme: A First Post-Symposium Assessment' as requested by the eight executive session of the Trade and Development Board. This document deals with the overall institutional, technical and legal dimension of the Trade Point Programme and attempts to outline the possible roles of the various parties involved, including Governments, the private sector and the UNCTAD Secretariat.
3. INTERVENTION
3.1 OVERALL OBJECTIVES
The overall objective of this project is to facilitate the participation and integration of Coastal West African countries in international trade, including intra-regional (South-South) trade. The establishment and linking of Trade Points is expected to reinforce the commercial ties between both neighbouring and distant markets and to facilitate access, at a reasonable cost, by SMEs to potential export and import markets through the use of the latest information and telecommunication technologies. The main thrust of the activities developed under this programme will be on capacity building in the area of electronic commerce.
Four countries of Coastal West Africa (which includes Benin, Côte d'Ivoire, Guinea-Conakry, Guinea Bissau, Ghana, Liberia, Nigeria, Sierra Leone and Togo) will be selected for the establishment of a Trade Point. Their results will contribute to the establishment of Trade Points in the rest of the sub-region to be pursued through a follow-up project which will be prepared in due course by UNCTAD.
At the beginning, Trade Points will be 'physical', i.e. they will offer services for trade at their premises, the final objective being to become virtual Trade Points electronically linked to their users, at least in the most technologically-advanced countries. Wherever possible, Trade Points will be given full IP Internet connection; basic connectivity (e-mail/EDI) will be provided for all selected countries.
Trade Points will be assisted in taking roots in their socio-economic environment and offering the most appropriate services at a reasonable cost, thus facilitating their task of inciting more actors - particularly SMEs - to participate in international trade. A particular effort will be made to assist micro enterprises through the cooperation with NGOs and other institutions operating locally for the integration of the informal sector in trade.
This project will also contribute to the development of Trade Points' capacity to progressively expand their functions from trade facilitation (better business practices) and business information dissemination to other trade-supporting services, including trade financing,
banking, insurance, Customs, transport and telecommunications. This will be done mainly through the progressive implementation of the sectoral recommendations adopted by the United Nations International Symposium on Trade Efficiency and annexed to the Columbus Ministerial Declaration.
The project will have a strong human resource component through the development and delivery of training programmes adapted to the needs and requirements of Coastal West African Trade Point managers and service providers.
3.2 PROJECT PURPOSE
3.2.1 Objective 1 - Establishment and connection of Trade Points
To establish and launch Trade Points in four selected Coastal West African countries. This will include the definition of a marketing strategy for the promotion of the Trade Points in their local context and the integration of Coastal West African Trade Points in the activities of the Global Trade Point Network.
Depending on local conditions (in particular, telecommunications infrastructure), the Trade Points will be given either full IP Internet connection or basic connection (e.g.,e-mail/EDI).
3.2.2 Objective 2 - Trade Points for micro enterprises
To facilitate access to potential export and import markets for small enterprises through the Trade Points at a reasonable cost. The participation of micro enterprises in local and international trade will be facilitated through the association of the Trade Points with NGOs and other institutions operating locally in this field.
3.2.3 Objective 3 - Development of business information services (ITC component)
To make available efficient business information services at the Trade Points which will enhance their commercial viability. This will be achieved through the provision of appropriate human resources development activities and the introduction and absorption of modern management tools for trade information collection, processing, analysis and dissemination, enabling enterprises to make effective decisions regarding trade of products, services, sources of inputs and other trade-related activities.
ITC will be responsible for implementation of activities related to this objective.
3.4 Objective 4 - Building local capacities in delivering transactional services
To build up local capacities in trade facilitation, and make available efficient trade-related services at the Trade Points, i.e.: telecommunications, Customs, transport, banking and insurance. It has been estimated that the adoption of trade efficiency measures could reduce transaction costs by some 25 per cent before year 2000. In the case of Coastal West African countries, expected gains could be even higher: in most of these countries, the benefits from trade efficiency would probably be higher than those stemming from the implementation of the Uruguay Round.
Activities in the field of trade facilitation will be carried out in cooperation with the UN-ECE.
Activities in the field of Customs will be carried out in coordination with the ECOWAS project for Customs automation through ASYCUDA in conjunction with the EUROTRACE system. This project is to be financed by the European Development Fund. In particular, it is expected that Coastal West African Trade Points will benefit from the activities of, and work in cooperation with the ECOWAS Community Computer Centre based in Lomé (Togo), which is going to be strengthened and upgraded through the ECOWAS/ASYCUDA project.
3.3 EXPECTED RESULTS
3.3.1 Results related to Objective 1
a) At least one Trade Point established and operational in each of the four selected Coastal West African countries, and Trade Points staff trained.
b) A marketing strategy for the promotion of Coastal West African Trade Points developed for their full integration in the local business context, with particular attention to the needs of SMEs.
c) Trade Points fully participating in activities carried out in the framework of the GTPN (including Trade Point managers' meetings).
3.3.2 Results related to Objective 2
d) A working relationship established among Trade Points and NGOs and other institutions operating locally to promote the integration of the informal sector in local and international trade.
3.3.3 Results related to Objective 3 (ITC component)
(e) An inventory established for the most appropriate types of trade information to be provided, including their most suitable sources. This will cover not only information on products and markets, but also include technical aspects related to trade such as quality management, packaging, environmental issues, trade financing, legal aspects and pertinent issues related to the Uruguay Round Agreements.
(f) A mechanism for the collection, analysis and dissemination of trade information developed, tested and made operational at the Trade Points (including a data quality control system).
(g) Users' manuals produced to facilitate an optimum utilization of the information provided.
(h) A target of 8 trade information specialists (on average 2 per Trade Point) trained in collecting, analysing, processing and disseminating trade information to Trade Point users.
(i) A target of 50 national correspondents in cooperating agencies (TPOs and business organizations) trained in interfacing with Trade Points for information exchange.
(j) Key business enterprises trained in the use of trade information for initiating and conducting efficient international trading operations.
3.3.4 Results related to Objective 4
k) Multimedia services available at the Trade Points.
l) A trade facilitation service established at each Trade Point to assist in the implementation of the recommendations adopted at UNISTE with respect to business practices.
m) An ASYCUDA/Trade Point module developed and available at each Trade Point.
n) Trade finance and insurance products made available at each Trade Point.
o) Modern management techniques and technologies promoted in selected Coastal West African countries' transport systems.
It is important to underline that under this project, the results described above will be sought in the four selected countries of the Coastal West African sub-region. The remaining five countries will benefit from the experience gained in the pilot ones. Another project for the integration of the remaining five Coastal West African countries will be prepared by UNCTAD in due course (2nd phase) .
3.4 ACTIVITIES
3.4.1 Activities related to Objective 1
No. Related to Activity result
1 a) Assess local conditions relevant for the establishment and operational launching of the Trade Points, including:
- identify and evaluate current trade-related resources and information services available in each country;
- evaluate local communications facilities (VANs, e-mail, telecommunications);
- identify and evaluate local expertise available for the Trade Points;
- compare solutions implemented in developing countries where Trade Points already exist.
2 a) Define the most cost-effective strategy for the creation of Trade Points in Coastal West African countries, bearing in mind the need for standardization, especially for the interconnection of information systems, and the specific features of the trading community and the general socio-economic environment of Coastal West African countries. This will include the selection of four countries where the Trade Points will be established under this project (1st phase). The other five Trade Points will be created under another project to be prepared by UNCTAD in due course (2nd phase).
3 a) Establish pilot electronic connection to ease communications between the Executing Agency's headquarters and the national counterparts designated by the Government of each selected country for the creation of the Trade Points.
4 a) Organize at least one seminar per selected country to present the Trade Efficiency and Trade Point concepts to trade-related service providers and discuss their potential participation in the Trade Points.
5 a) Assist in the definition of the legal framework for the Trade Points in the selected countries in accordance with the internationally agreed criteria for the establishment of Trade Points.
6 a) and c) Assist in the practical establishment of the Trade Points in the selected countries, including:
- design the configuration for computer hardware and software;
- procure, install and test technical equipment and basic software;
- connect each Trade Point to the Global Trade Point Network (wherever possible through Internet) and begin to exchange Electronic Trade Opportunities (ETOs).
7 a) Train Trade Point staff in operating the Trade Points. This will include:
- adapt the training course currently developed by the TRAINFORTRADE programme for French-speaking Trade Point managers to the needs of Coastal West African countries;
- organize one training course for English- and one for French-speaking Trade Point managers using the course as adapted (if Guinea Bissau is selected, its Trade Point staff will be associated to a training course to be organized for all Portuguese countries of Africa).
8 b) Assist in the development and implementation of a Trade Point communications strategy aimed at informing trade operators, particularly SMEs, of the availability of innovative services at the Trade Points.
9 b) Assist in establishing a pricing policy ensuring Trade Points' self-sustainability and the widest access to Trade Point services especially for SMEs.
10 c) Organize at least three Trade Point Directors' meetings (one per year) to ensure coordination of project activities at the sub-regional level.
11 c) Support the participation of Trade Point Directors in international activities organized in the framework of the Global Trade Point Network.
3.4.2 Activities related to Objective 2
No. Related to Activity result
12 d) Promote the Trade Efficiency and Trade Point concepts among the NGOs and other institutions operating locally for the integration of the informal sector in trade. This will include:
- identify local, national and sub-regional bodies working for micro enterprises;
- invite NGOs and the other relevant institutions to the seminars organized under activity 4 of this project and discuss with them the establishment of operational links with Coastal West African Trade Points.
13 d) Promote the association of the NGOs with the Trade Points. This will include:
- identify services offered by the NGOs and other institutions for the integration of micro enterprises in local and international trade;
- assess which ones may be integrated in the Trade Points;
- make proposals for the association of those bodies which offer services not available at the Trade Points (e.g., credit to micro enterprises).
14 d) Promote the use of Trade Points by NGOs and other institutions, and the micro enterprises associated with them by, inter alia,
- propose a strategy for the use of Trade Points' facilities at a very low cost for the NGOs and the micro enterprises associated with them;
- organizing training events on marketing, trade financing and trade procedures tailor-made for the needs of micro enterprises.
3.4.3 Activities related to Objective 3 (ITC component)
No. Related to Activity
result
15 e) To hold consultations in the sub-region with a view to analysing the specific trade information needs of end-users of Trade Points, with respect to the national, sub-regional and international trading environment. Special attention will be given to women entrepreneurs in SMEs.
16 e) Review existing information sources and exchange facilities both at national and sub-regional level, and
17 e) Design trade information packages tailor-made to the specific requirements of each Trade Point - in compliance with international standards (e.g. EDIFACT), integrating locally available information products with those available elsewhere, including ITC-generated and adapted information databases such as PACKDATA, QUALIDATA and JURIS; UNCTAD generated databases such as TRAINS and other databases such as COMEXT of the EU, information on CITES, eco-labelling, etc.
18 e) Identify correspondents and make arrangements for the collection and dissemination of the most relevant information products provided by the Market News Service (MNS).
19 f) Agree on the most appropriate links and strategy for data collection, using on-line (wherever possible, through the INTERNET), on diskette, CD-ROM or printed format, depending on the life-time of the information.
20 f) Arrange for the pre-packaging of such information (e.g. in the form of news service, bulletin board, etc.).
21 f) Guide the design of trade information management systems to be operated by national Trade Points, including management options for cost recovery, in line with the objective of self-sustainability of Trade Points.
22 h) and i) Produce training material in English and French, including training kits with multimedia techniques for use both by trade information specialists as well as by training centres (training of trainers) and formulate modular trade information training programmes to be implemented at the national and sub-regional level.
23 h) and i) Organize national seminars for Trade Point trade information managers and staff of national cooperating agencies, in close collaboration with national training institutions (with many of whom ITC maintains close working relations).
24 h) and i) Organize one sub-regional seminar for the strengthening of sub-regional trade information exchange between national and sub-regional entities.
25 h) Provide on-site training to trade information specialists and managers.
26 g) Prepare or adapt manuals on the appropriate utilization of trade information to be used by local trade information specialists.
27 j) Organize workshops for, and provide limited technical advice to local trade information users, in particular SMEs, to promote trade information services and to ensure the most effective utilization of trade information.
28 f) Explore complementarities among the Trade Points' ETOs system and other trade information systems that ITC might develop in the future.
29 f) Provide operational linkages with the ECOWAS Trade Opportunities Information System (TOPS), and other sub-regional trade information networks (TINET) when and where established.
3.4.4 Activities related to Objective 4
No. Related to Activity
result
30 k) Install multimedia equipment at the Trade Points.
31 k) Train Trade Point staff on the production of multimedia material and its downloading on the Internet.
32 k) Assist in the collection and processing of local/national multimedia data on trade and services.
33 k) Create the HTML (Hyper Text Markup Language) documents required to broadcast the information collected under activity 30 on the Internet. Downloading on the Internet will be done locally if an Internet WorldWide Web connection is available or through a Trade Point Development Centre.
34 l) Analyze existing trade procedures in the selected Coastal West African countries and identify problem areas in which trade facilitation recommendations should be adopted by the Governments of the sub-region.
35 l) Assist Coastal West African Governments in the definition of a strategy for the implementation of trade facilitation measures based on the 'Compendium of Trade Facilitation Recommendations'.
36 l) Make available internationally agreed trade procedures, documents and codes at the Trade Points , and promote their use in the selected Coastal West African countries.
37 l) Assist in the development of trade facilitation services at the Trade Points, particularly through the training of Trade Point staff and service providers on trade facilitation measures . This will include:
- prepare training material based on the 'Compendium of Trade Facilitation Recommendations';
- organize at least one seminar in each country.
38 m) Analyze, design and develop an ASYCUDA/Trade Point module offering:
- facilities to extract and present information from the ASYCUDA data base on commercial flows;
- tariff enquiries;
- a set of DTI (Direct Trade Input) functions allowing trade operators to fulfill Customs procedures and requirements at the Trade Points.
39 m) Establish operational links between each Trade Point and the national Customs administration automated system.
40 m) Test the module at the Trade Points.
41 m) Train Customs officers and brokers who will work with the Trade Points in the use and maintenance of the system.
42 n) Evaluate the banking and insurance services (especially export insurance and export credit services) already available to local traders.
43 n) In cooperation with local banking and insurance institutions, particularly those which support the integration of the informal sector in international trade (as per objective 2), design additional services and products to be provided to the Trade Point users.
44 n) Assist in establishing local mechanisms and institutions for the consolidation and handling of requests for credit and insurance coming from small firms, including micro enterprises.
45 n) Assist Trade Point service providers and users in obtaining preferential access to networked-based financial services (e.g. SWIFT) through the Trade Points.
46 o) Assist governments and parastatals in the definition of a strategy for the simplification of procedures and the modernization of transport legislation.
47 o) Assist in interfacing Trade Points with the UNCTAD transport information system ACIS along transport chains, in order to enable local operators and their clients to monitor the movement of goods, thereby increasing efficiency, minimizing delays and reducing costs. It is expected that this activity will focus on the development, instalment and testing of an interface between the Côte d'Ivoire Trade Point and the SICF (the system for railway transport automation already installed in Côte d'Ivoire under ACIS), and the Ghana Trade Point and both GPHA and GRC (respectively, the systems for ports and railway transport automation already installed in Ghana under ACIS).
Based on the outcome of this pilot experience, more interfaces will be developed and installed at the Trade Points in the other countries.
48 o) Train Trade Point staff and users in these two countries on the use of the systems. This will include:
- preparation of training material;
- organization of a seminar in each of the two pilot countries.
4. ASSUMPTIONS
4.1 ASSUMPTIONS AT DIFFERENT LEVELS
4.1.1 Assumptions at the level of activities
a) This project will be implemented in the selected Coastal West African countries at the request of national authorities. Therefore, it is expected that these authorities will make every effort to comply with the requirements established under the project for the establishment and management of Trade Points. These include:
- to offer adequate facilities for the establishment of Trade Points;
- to rely upon dedicated staff for the management of Trade Points.
The success of the project will depend significantly on the choice of the national counterparts involved in its implementation. Training will be provided throughout the project to ensure high-level performance of Trade Point personnel. However, a degree of flexibility will have to be introduced by national authorities in order to allow the replacement of local staff in case of poor performance.
b) This project complements the Trade Development Project of the European Union. Therefore, it is assumed that its activities will be coordinated with those carried out under the EU-TDP (see part 5.2 "Organization and Procedures").
4.1.2 Assumptions at the level of results
The expected results of the project will not be fully achieved without continuity at the institutional level. Therefore, it is important that performing staff assigned to the Trade Point programme by national administrations - and, as much as possible, by private counterparts - remain at their post after completion of the project.
4.2 RISKS AND FLEXIBILITY
The main risks are connected to the possibility of low performance and/or poor contractual situation for the staff involved in the project implementation, especially in relation with the introduction of new technologies for trade. However, the project includes training activities which should minimize these risks. Moreover, the project approach and work plan are flexible enough to adapt to local conditions and to unexpected problems which could arise during the project implementation. National authorities should also pay special attention to ensure appropriate and competitive working conditions for local staff.
5. IMPLEMENTATION
In many developing economies, the first steps have been taken to make traditional structures and attitudes more trade efficient. However, such efforts could remain fruitless if the key sources of trade competitiveness remained out of reach for the proponents and initiators of change. Concerted international action is needed to ensure that all potential participants in international trade can access the new sources of trade competitiveness at a reasonable cost. Since a priority objective of such action will be to increase the number of participants in international trade, innovative approaches will need to be developed to allow those countries which do not have the basic information infrastructure and technologies to integrate positively in global trade through higher trade efficiency.
Specific local resource mobilization strategies must be encouraged whenever possible to ensure local commitment. This includes, inter alia, making use of local experts, locally available equipment and technical infrastructure.
Taking into account past experiences in trade-related technical cooperation activities in African countries, the evolution in international trade environment and the growing importance of information and telecommunication technology in trade, UNCTAD will execute this project in association with the ITC and in close cooperation with the UN-ECE.
5.1 PHYSICAL AND NON-PHYSICAL MEANS
5.1.1 Contribution of the European Commission
UNCTAD Component (Objectives 1, 2 and 4)
Project Personnel
(The project will make the most extensive use of local human resources, particularly for experts and consultants)
Sub-regional Coordinator 24 m/m
One high-level coordinator will supervise and monitor the establishment and operational launching of Coastal West African Trade Points and the implementation of recommendations made by consultants. The coordinator will be based in the sub-region and will work in close cooperation with nationally-appointed Trade Points managers. S/He will be a specialist of international trade and have a good experience in management of technical assistance projects in the field of trade and trade-related services. S/He will also have strong skills in the field of computer technology and software, with an emphasis on networking. S/He will have a strong aptitude to team work in a multicultural environment.
Experts Total: 50 m/m
Analysts and programmers will design, develop and test the software solutions described in the activities. (22 m/m)
Experts in communication and information technologies will contribute to carry out the activities related to Objective 1 and 4. (22 m/m)
Trade documentation experts will assist in carrying out activities related to Objective 4.
(6 m/m)
Consultants Total: 30 m/m
Specialists in the following key sectors of trade and trade-related services are needed to carry out activities related to Objective 4:
Banking (4 m/m)
Insurance (4 m/m)
Transport (6 m/m)
Customs (6 m/m)
Moreover, human resources development (HRD) specialists will be needed to adapt training materials, train local trainers, Trade Point managers, service providers and users. They will also advise Trade Point managers on the set up of local training activities. (10 m/m)
Travel costs
This item contributes to covers the cost of travel and per diem of the sub-regional coordinator, experts, consultants and UNCTAD staff for the implementation of project activities. This item will also contribute to cover the cost of travel and per diem of Trade Point managers for their participation in sub-regional, regional and international Trade Point Directors' meetings and other activities organized in the framework of the Global Trade Point Network (see activities related to Result c).
Sub-contracts
Sub-contracts to UN-ECE and other institutions required for the implementation of project activities will be financed through this budget line.
Group Training
This item contributes to cover the cost of travel and per diem of HRD consultants, local trainers and UNCTAD staff to Coastal West Africa to carry out training activities. It may also include the honoraria, travel and per diem of lecturers invited to contribute to training events.
Expandable and non- expandable equipment
This item contributes to cover the cost of the hardware and software required to implement project activities and not available in the participating countries.
Communications
This item contributes to cover the cost of communications incurred by the Coastal West African Trade Points, particularly in the first phase of their activities.
ITC Component (Objective 3)
Project Personnel
Experts Total: 40 m/m
The trade information component of the project will be delivered with the assistance of 3 advisers. A Senior Trade Information Adviser will be responsible for the overall design of the activities described under 3.4.3, a Trade Information Training Adviser will in particular coordinate the human resources development aspects, while a Trade Information System Analyst/Programmer will be responsible for the overall EDP and telecommunication aspects of this specific component.
National Consultants Total: 60 m/m
In each of the participating countries, a national consultant will be appointed for the purpose of enhancing the coordination of the various project activities and for ensuring the collection of locally available information.
Administrative support
Secretarial assistance will be required for the execution of project activities.
Subcontracts
Subcontracts will be issued primarily for the production of training materials.
Group Training
A provision is made for the undertaking of training activities, both at the national level for Trade Point and trade information managers, Trade Point users and staff of national cooperating agencies, and at the sub-regional level for the strengthening of trade information exchange activities. The training will be undertaken in close collaboration with national institutions.
Equipment
As per UNCTAD.
Operation and maintenance
A provision is made to cover the initial cost of subscriptions and telecommunication charges.
5.1.2 UNCTAD Contribution
UNCTAD will provide substantive support and administrative backstopping to the project. Quality control, orientation and policy guidelines will be provided by the Special Programme for Trade Efficiency.
Trade efficiency activities in Coastal West Africa will be coordinated with the Programme's activities in other regions and sub-regions. Maximum synergy will also be sought with other UNCTAD programmes operating in the field of trade and trade-related services such as ASYCUDA, ACIS and TRAINFORTRADE.
5.1.3 ITC Contribution
ITC will provide substantive support and administrative backstopping for the activities related to Objective 3 of the project.
5.1.4 Contribution of the participating countries
Each country will provide the necessary human resources and facilities for the establishment of "minimal Trade Points". These include:
- Trade Point personnel (including administrative support);
- office space and telecommunication facilities;
- information processing equipment, including at least:
one 486-DX2 or Pentium PC with 16 MB RAM and 1 GB hard disk
one CD/ROM drive
one multimedia scanner
one high speed external modem
software
- audiovisual equipment (especially for training activities).
The project budget will contribute to making available these facilities wherever needed.
5.1.5 Contribution of other institutions
For the last two years, the UNCTAD Special Programme on Trade Efficiency has been working in close cooperation with ITC, the UN-ECE, and the World Customs Organization in the identification and promotion of trade efficiency measures, and will continue to do so for the execution of this project.
Moreover, UNCTAD and ITC will cooperate with all regional institutions likely to contribute to the building of the Trade Point Network and to the implementation of trade efficiency measures, such as ECOWAS, the UN Economic Commission for Africa and the ACP Secretariat.
5.2 ORGANIZATION AND PROCEDURES
UNCTAD will execute the project and bear responsibility for the implementation of the workplan. Activities related to objective 3 will be implemented by ITC, while some others may be sub-contracted to the UN-ECE, which are both associated with UNCTAD for the implementation of the Trade Efficiency programme. In these cases, an inter-agency agreement will be prepared by UNCTAD according to the UN procedures.
A joint UNCTAD/associated agencies unit will be set up in Geneva to ensure a synchronized and coordinated staging of the various interlinked activities. This unit will also be responsible for the development of innovative solutions to problems that may be reported during the life of the project. However, UNCTAD and the associated agencies will assume administrative and substantive responsibility for those project activities which fall within their respective areas of competence as stipulated in the project document.
The unit will also implement this project in close cooperation with other organs and agencies of the United Nations system, as well as other inter-governmental organizations so as to ensure proper and mutually reinforcing relationships among this project and other on-going activities in the field of trade and EDI.
5.3 TIMETABLE
A tentative timetable is attached in Annex II.
5.4 COST ESTIMATE AND FINANCING PLAN
The total cost of this project is estimated at ECU 1.950.000 (see budgets in Annex III).
5.5 SPECIAL CONDITIONS AND ACCOMPANYING MEASURES TAKEN BY GOVERNMENTS
For the implementation of the project, and in accordance with the Trade Efficiency recommendations, Governments of the selected Coastal West African countries will be expected to take following action:
a. Liaise with the directors of Trade Points to support the preparation and implementation of reforms, including coordination of efforts for the preparatory work in the establishment of the Trade Points.
b. Introduce reforms related to rationalizing import and export procedures.
c. Update existing legislation and regulations.
Moreover, cooperation among Governmental authorities and the business community in facilitating trade will be instrumental in the successful implementation of the project.
6. FACTORS ENSURING SUSTAINABILITY
6.1 Policy support measures
The philosophy, purpose and expected impact of the Trade Point make it a natural support and enhancement tool for the economic reforms under way in many Coastal West African countries. Such reforms on one hand, and the development of the Trade Point on the other will have a mutually reinforcing effect since the Trade Point will offer a showcase for the implementation of reforms, and an array of practical tools to translate them into tangible results for traders.
6.2 Appropriate Technology
The experience gained by UNCTAD in the fifteen years of implementing Customs automation systems in developing countries has allowed the progressive development of hardware and software solutions adapted to the specific conditions of these countries. Recent advances in information technologies have reduced the gap between 'adapted' and 'advanced' technologies, and the Trade Point allows local traders to benefit from the most recent approaches to networking and information handling without increasing their dependence on external know-how or technologies. The core component of the Trade Point is its trade facilitation component, which requires only minimal technology. In general, such minimal technology is already available locally.
6.3 Environmental Protection
This project does not imply any damage to the environment. In addition, through its training programmes, it will strive to contribute to the recognition of the importance of environmental consideration in relation to trade. Trade Points could contribute to the better information of local producers and traders on environment-related regulations and incentives.
6.4 Socio-cultural Aspects/Women in Development
By promoting the involvement of smaller firms (including micro enterprises) in international trade, the Trade Point Programme has already started to show tangible results regarding the participation of women in development. Out of the 91 Trade Point managers and coordinators already appointed, some 20 are women.
6.5 Institutional and management capacity
A central objective of this project is capacity and institution building in the field of foreign trade. The focus on training for trainers should contribute to generate sustainable management and trading skills in the participating Coastal West African countries. Moreover, the institutional framework in which Trade Points will be set up and operated is one in which different components will constantly reinforce each other at the national, regional and inter-regional level.
6.6 Economic and financial analysis
Trade Points are commercial entities. Even if they are established as non-profit seeking enterprises, they will collect fees from their users, as well as from other Trade Points, depending on the type of services they are able to offer. During the first year of the project, significant amounts of external resources will be received to set up the Trade Point and generate the local skills and capacities needed for its sustainability. During the following two years, services will progressively be expanded and promoted, and prices will be established for their continued delivery to local users and other Trade Points. By the end of the third year, all Coastal West African Trade Points are expected to be financially self-sustained.
7. MONITORING AND EVALUATION
7.1 MONITORING INDICATORS
The project implementation unit in Geneva will ensure a synchronized and coordinated staging of the various interlinked activities. This unit will also be fully responsible for the substantive back-stopping of the project and for the development of innovative solutions to problems that may be reported during the life of the project. The project implementation unit will be guided by a steering committee which should include representatives of the beneficiary countries and the donor supporting the project.
After an initial period of one year, UNCTAD will prepare a progress report summarizing the project implementation and the itemized disbursement of allocated funds for submission to the donor agency.
7.2 REVIEWS/EVALUATION
A mid-term multi-partite review will be conducted at the 18th month of the project life by the participating institutions, i.e. the European Commission, UNCTAD and the associated agencies. An evaluation will be conducted at the end of the project. The project implementation unit will ensure that evaluation results be fully transmitted to the steering committee.
THE TRADE POINT PROGRAMME
A key component of the Trade Efficiency Initiative is the "Trade Point Programme", which consists mainly of establishing, operating, and interconnecting Trade Points in all regions of the world. The programme facilitates access to the latest information and telecommunication technologies by making them available to trade operators in developing countries and to SMEs worldwide - at a reasonable cost - through the chain of Trade Points, with the overall objective of reducing the risk of exclusion and increase participation in international trade.
What is a Trade Point?
A Trade Point is:
¨ A trade facilitation centre, where participants in foreign trade transactions (e.g. Customs, foreign trade institutes, banks, Chambers of Commerce, freight forwarders, transport and insurance companies) are grouped together under a single physical or virtual roof to provide all required services for trade transactions at a reasonable cost.
¨ A source of trade-related information which provides actual and potential traders with data about business and market opportunities, potential clients and suppliers, trade regulations and requirements, etc.
¨ A gateway to global networking. All Trade Points are being or will be interconnected the Global Trade Point Network, and equipped with efficient telecommunications tools to link up with other global networks.
The Trade Point system puts potential and actual traders in the position of suppliers as well as of users of strategic information. Traders identify markets for their products, complete procedures and meet requirements on the spot, in less time and at lower cost than before. Traders can make use of new technologies and techniques in the daily course of business, in particular some of the Electronic Data Interchange (EDI) applications already used in many industrialized countries, as electronic billing, payment, cargo manifest, Customs declaration, market opportunities.
The Global Trade Point Network
The Trade Point Programme started in February 1992 at UNCTAD VIII in Cartagena de Indias, with the objective of establishing 16 pilot Trade Points, and its first phase culminated in the United Nations International Symposium on Trade Efficiency. In Columbus, more than 2000 decision-makers from both the public and private sectors including Prime Ministers, vice-Prime Ministers and some eighty Ministers from 136 countries adopted the Ministerial Declaration on Trade Efficiency, which officially launched the Global Trade Point Network (GTPN), a first worldwide illustration of the positive role which the Global Information Highways can play in the field of trade and development.
The GTPN relies on the most advanced available technologies for networking and multimedia communication. One its most widely used features is its 'Web site', on the Internet. Thanks to the Trade Points, all connected countries and enterprises can now exchange 'ETOs' (Electronic Trading Opportunities), as well as other types of information regarding existing trade regulations, banking practices and market intelligence.
As the number of connected Trade Points increases, the Global Trade Point Network will rapidly emerge as one of the main worldwide network for trade-related information flows. It will become increasingly difficult for any major trading partner to stay out of it, and the subsequent increase in traffic will allow substantive reductions in the cost of collecting, formatting, transmitting and processing such information. This will allow both a continued increase in the number of Trade Point beneficiaries (especially SMEs) and a strengthening of the technological advance characterizing the GTPN approach (through reinvestment in research and development).
Customs are a good example of how the connection of Trade Points into a global network can create synergies with efforts made to introduce information technologies in order to increase efficiency in trade. The establishment of efficient Customs systems is a basic objective of the Trade Points, which will be pursued wherever possible through UNCTAD's Automated SYstem for CUstoms DAta (ASYCUDA). ASYCUDA, introduced by UNCTAD in over 70 countries and regions, has brought EDI techniques into Customs, thereby reducing significantly the traditional delays and paperwork holding up merchandise at the borders. The Global Trade Point Network, by enhancing the possibilities to use EDI in international trade, will create the ideal environment in which different national ASYCUDA systems will be able to interact more efficiently. The development of an Internet/WWW interface will give traders an easier access to Customs-related information. It will also foster the setting-up of Direct Trader Input (DTI) services. Besides, countries in which Customs still need to undergo reforms to streamline procedures and to benefit from information technologies, will have additional incentives to introduce the system once they are exposed to it through their connection to the GTPN.
The first phase of the programme was fully achieved, since as of 15 May 1995, 84 Trade Points had been or were being established in 55 countries, while another 41 official requests had been submitted to UNCTAD. The second phase, and in particular the interconnection of the Trade Points, has started with the launching of the GTPN at the Columbus Symposium and will be carried out with the support of the Trade Point Development Centre and with the TPDC Labs (TPDC Labs).
What is the Trade Point Development Centre and what is a Lab?
The primary objective of a TPDC is to assist Trade Points worldwide to get connected to the Global Trade Point Network, particularly through the Internet. TPDC cooperates with regional or sub-regional TPDC Lab providing decentralized access to the GTPN for Trade Points in their region.
The Trade Point Development Centre was initially located in Bangkok (Thailand) and established in cooperation with the Asia Institute of Technology. At present, it is going to be mved to Melbourne in coperation with the Royal Melbourne Institute of Technology.
Given the rapid multiplication of Trade Points worldwide, the TPDC can no longer centralize services and datain the Global Trade Point Network. That makes it necessary to set up TPDL in Asia, Africa and Latin America.
At this stage, the following sites are being considered for the establishment of a TPDL: Australia, Brazil, China, India, Kenya and the United States. The central node of the system would be in Geneva, since all TPDL Internet servers will be connected via the United Nations International Computing Centre (UNICC). Each Trade Point will be free to select its own way to connect to the GTPN as long as it maintains full compatibility with the TPDL-UNICC Internet Server. Developing countries (and sometimes other countries without packet switching data network - PSDN) can be connected via Internet and/or SITA.
Solutions developed by the TPDLs must abide by the basic principles on which the GTPN is funded, namely openness (i.e. the solutions and systems will be interconnectible and interoperable, which implies a strict respect of universal norms and standards, in particular those promoted by the United Nations, such as UN-EDIFACT), non-exclusivity (i.e., the equipment and services supplied to the GTPN must be delivered on a non-exclusivity basis, leaving the Trade Points permanent freedom to select the best quality/price ratio), and universality (i.e., the solutions developed will be of use to all types of Trade Points in all types of environments with the purpose of 'excluding exclusion). The latter requires, inter alia, additional efforts in favour of least developed countries, as well as SMEs.
Current state, assets and needs of the Global Trade Point Network
A substantive body of experience and expertise has already been made up during the first phase of the Trade Point Programme. A sound basis is now available to carry out the actual interconnection of Trade Points.
As of January 1995, some 60 Trade Points were in the process of being connected and exchanging data and services within the Global Trade Point Network. The connectivity is point-to-point, allowing Trade Points to connect from places traditionally excluded from the so-called Information Highways. An important feature of the Global Trade Point Network is that it is genuinely decentralized. Trade Points stock data at the national level and provide gateway access to the data of other Trade Points.
The UNCTAD Special Programme on Trade Efficiency is now focusing its activities on the development of the Network in Africa through this and other projects which are now being prepared. An important element of this strategy is the cooperation of the Trade Points with NGOs and other institutions operating locally for the integration of smaller enterprises in trade.
Trade Points, NGOs and micro enterprises
In many countries, exclusion from formal economic circuits has prompted micro enterprises to create trade associations capable of dealing with the specific problems of local traders and devising effective ways of dealing with them. By grouping, for instance, local technical and human resources they offer easier access to trading opportunities and credit.
Because of their thorough knowledge of the micro-economic sector, which accounts for 50% of the work-force in many African countries, including Coastal West Africa, and of the confidence of the small entrepreneurs they gained, NGOs provide the most effective link between micro enterprises and the rest of the economy. In this respect, the experience acquired by NGOs can enhance the quality of the services rendered at the Trade Point and, conversely, NGOs can greatly benefit from the Trade Point's position as a gateway to international trade.
In particular, Trade Points activities should focus on the following areas:
- Local trade
In poverty-stricken areas, especially in LDCs, Trade Points can play a vital role in allowing local small producers (micro enterprises) to trade locally, i.e. typically in a radius of less than one hundred kilometres. By providing access to basic information about local markets, and by providing access to trade-supporting services including transport or credit, Trade Points can work hand in hand with local communities and NGOs to promote the activities of micro enterprises in a large array of sectors and regions.
- NGOs' need for institutional strengthening
NGOs and other local development organizations have increasingly become involved in the financing of micro and small enterprises, and have initiated often innovative financing programmes. However many of these institutions have difficulties in combining the businesslike approach required for managing a credit and savings programme with their social oriented roots. Often they lack the technical, administrative and business know-how to provide well-organized and effective services to the small entrepreneurs, which could effectively be offered by the Trade Points.
- Financing of small and micro enterprises
By generating a critical mass of small and micro enterprises at the regional and international levels, the Global Trade Point Network has the potential to increase the interest of credit providers in helping such enterprises to develop. Specific focus should be granted to export credit and to the possibility to establish innovative financial instruments to assist them at the international level. Attention will also be given to develop Trade Points' contribution to the creation and sustainability of clearing houses or other cooperative mechanisms likely to help local small and micro enterprises to overcome hard currency shortages or lack of access to currency markets.
- Training for small and micro entrepreneurs
Considerable training needs exist in most developing countries regarding the basic techniques and rules of international trade. The Trade Points offer an ideal base for setting up sub-regional and regional training programmes in this area. The GTPN in particular, offers promising avenues to stimulate exchanges of experiences among countries, using available information technologies. For the benefit of micro enterprises, such programmes, undertaken in cooperation with or through local institutions and NGOs, may include courses and seminars addressing the specific needs of local micro-entrepreneurs (e.g., basic management and budgeting techniques), as well as activity specific programmes (e.g., on agricultural production and marketing, semi-industrial production, etc.).
Terminology
Reference is made throughout this document to Internet access. Having Internet access means being able to send and receive E-mail, transfer files, log into remote computers and reach information servers like Gophers (text files) or WorldWide Web (WWW) servers (multimedia and more user-friendly).
Gopher servers allow users to examine directories and files in remote computers and downloading files in the users' computer. Gophers use a very simple menu-based interface.
WWW was developed in the late 1980s at CERN (Centre Européen de Recherche Nucleaire) in Geneva. WWW and related interface and search software allow virtually any user equipped with a simple personal computer and a modem to access databases and information networks anywhere in the world. WWW uses a very intuitive, graphic-based interface. However, users need access to a local Internet service provider.
This kind of full Internet connection is now possible in about ninety countries in the world. In many other countries, particularly in Africa, only E-mail access to the Internet is now possible. This means that in these countries it is possible to send and receive E-mail to/from other Internet users, but there is not access to Gopher or WWW servers. Fidonet and UUCP are used in Africa and Latin America for this purpose.
In order to have full Internet access it is necessary to have at least a personal computer, a modem or a leased line, telecommunications software complying with the TCP/IP standards and an agreement with an Internet service provider (EUNET, for instance).
Having access to the Internet is not the same than having a presence on the Internet. This is more complex, and can be defined as being able to put information on a Gopher or a WWW server, so that the rest of the Internet community can reach it. It is in this sense that the TPDC will aim at providing "access" to the Internet, and not in the sense of becoming Internet service providers.
Posting information on the Internet requires an Internet server (normally a more powerful computer than a PC), a leased (dedicated) line that allows users to access information permanently, and an agreement with an Internet access provider who connects the server with the rest of the Internet community. As a security measure, installing a "firewall" is also necessary. This is a software that prevents unauthorized Internet users to access sensitive data or to cause damage to the Internet server.
Computer expertise is required to post information on the Internet. Using a Gopher server to do it is relatively easy. Basically only knowledge of UNIX language is required. WWW servers require documents prepared in Hypertext Markup Language, which is a complicated and time-consuming task.
Advantages of using the Internet
The experience of the last two years allows to conclude that Trade Points can use the Internet effectively as a tool for communication, exchange of data and decentralization of information databases. Some advantages that such a choice would offer are:
- Quick and convenient method of exchanging information with a relatively low cost operation (often just a local telephone call is required to access Internet). Many countries in the world can access the Internet either via local providers (Universities and Research Centres are normally providing local Internet access) or via Public Data Switching Network PADS.
- Access can also be obtained in an increasing number of countries through organizations and companies such as SITA, General Electric, AT&T, and British Telecom. UNDP is also providing now Internet access in the field for its local offices. In Geneva, the ITU is presently providing Internet access and Gopher/WWW (database) services. Similar approaches will need to be developed under the present project to allow unconnected countries (such as most sub-Saharan African countries) to access the Internet.
- Worldwide access to a large array of databases, information services and experts through electronic mail. Each Internet user is an E-mail user with a unique address. Trade Points are one of the active communities (called 'domains') on the Internet.
- Users receive large amounts of free information. The TPDC supervises the quality of the information to be broadcasted to the Global Trade Point Network as a clearing house for Trade Efficiency Information.
- Users of the Internet can interact with one another across town or across continents. The concept is close to that of a Bulletin Board System (BBS), (or 'kiosque' in the French Minitel terminology). It is however a truly decentralized system, in which any user can connect with any other user, without having to go through a predetermined 'focal point' or communication node.
ANNEX V
The Columbus Ministerial Declaration