2. WTO Agreements
Agreement on Technical Barriers to Trade (TBT)
◦ relates to trade restrictive effect arising from the application
of technical regulations or standards such as testing
requirements, labelling requirements, packaging
requirements, marketing standards, certification
requirements
Agreement on Sanitary and Phytosanitary
Measures (SPS)
◦ Agreement covers all measures which aim to protect (i)
human or animal health from food-borne risks arising from
additives, contaminants, toxins or disease causing
organisms in their food; (ii) human health from animal- or
plant-borne diseases; and (iii) animals and plants from
pests, diseases or disease-causing organisms.
3. Trade Barriers: Japan
High Tariffs on Imports
Beef, Citrus, Dairy, Processed Food Products & Rice
These high tariffs generally apply to food products where Japan has domestic
production to restrict imports.
Wheat Import System
Wheat is imported through MAFF's Food Department, which then resells the
wheat to Japanese flour millers at prices substantially above import prices.
These high prices discourage wheat consumption by increasing the cost of
wheat based foods in Japan.
Wood Products and Building Materials
Japan continues to restrict imports of certain manufactured wood products
through tariff escalation (i.e. progressively higher tariffs based on the level of
processing of the wood product).
4. Trade Barriers: Japan
Transparency
Transparency issues remain a top concern of companies operating in Japan‘s
market
Health IT
Cloud Computing
IT and Electronic Commerce Policymaking
Insufficient transparency in Japan‘s policymaking process for all above has
stifled innovation and competitiveness in Japan and constrained company
access.
Legal Services
Japan imposes restrictions on the ability of foreign lawyers to provide
international legal services in Japan in an efficient manner.
5. Trade Barriers: Japan
Investment Barriers
Despite being the world's third largest economy, Japan continues to have the
lowest inward foreign direct investment (FDI) as a proportion of total output.
Reasons include:
Attitudes toward outside investors;
Inadequate corporate governance mechanisms and a relative lack of
financial transparency and disclosure.
Automobiles and Automobile Parts
A variety of nontariff barriers have traditionally impeded access to Japan‘s
automobile and automotive parts market.
For example, U.S. automakers seeking to introduce, for testing and
demonstration purposes, automobiles using new technology (i.e., fuel cell
vehicles) have faced a lack of transparency and other barriers to certifying
these new products in a timely and efficient manner.
6. Trade Barriers: China
Tariffs and Other Import Charges
China still maintains high duties on some products that compete with
sensitive domestic industries.
For example,
• The tariff on large motorcycles is 30 percent
• Raisin imports face duties of 35 percent
China reserves a portion of the in-quota imports for state trading
enterprises, while it makes the remaining portion (ranging from 10 percent
to 90 percent, depending on the commodity) available for importation
through non-state traders.
Tariff Classification
• Chinese customs officers have wide discretion in classifying a
particular import into any tariff categories.
7. Trade Barriers: China
Export Quotas, Duties and Licenses
China maintains export quotas and sometimes export duties on antimony,
bauxite, coke, fluorspar, indium etc. to help the development of downstream
industries.
Land Issues
China‘s constitution specifies that all land is owned in common by all the
people.
The State and collectives can either ―grant‖ or ―allocate‖ land-use rights
to enterprises in return for the payment of fees, or in some cases without
the payment of any fees. The time limit for land-use rights acquired by
foreign investors for both industrial and commercial enterprises is 50 years.
8. Trade Barriers: China
Intellectual Property Rights (IPR) Protection
Persistent inadequacies in the protection and enforcement of IPR represent
barriers to other countries exports and investment.
For example:
Retail and wholesale counterfeiting
End-user piracy of business software and copyright piracy over the
Internet.
Regulations
Set high thresholds for entry into service sectors such as banking, insurance
and telecommunications.
For example: Foreign life insurance companies can only be established as
joint ventures, with foreign equity capped at 50 percent.
Construction, Engineering, Architectural and Contracting Services
High minimum registered capital requirement
Limited scope of projects that can be undertaken by foreign-invested
enterprises.
9. Trade Barriers: US
100% scanning
Aims to enhance security by countering potential terrorist threats to the
international maritime container trade system, foresees the 100% scanning
of all US-bound containers
Tariff Barriers
Despite the substantial tariff reduction and elimination, the U.S. retains a
number of significant duties and tariff peaks in various sectors including food
products, textiles, footwear, leather goods, ceramics, glass, and railway cars.
Import Duties
Additional customs impediments, such as import user fees and
excessive invoicing requirements on importers, which add to costs in a
similar way to tariffs.
The most significant user fee is the Merchandise Processing Fee, which is
levied on all imported merchandise except for products from the least
developed countries
10. Trade Barriers: US
Public Procurement
In the field of public procurement, the main U.S. trade barriers are contained
in a wide array of clauses in federal, state and local legislation and regulation
giving preference to domestic suppliers or products,
Foreign Direct Investment Limitations
The Foreign Investment and National Security Act (FINSA) restrains foreign
investment in (or ownership of) businesses relating to national security.
U.S. restrictions on foreign investment are particularly evident in the
shipping, energy , communications and telecommunication sectors.
Tax Discrimination
Several aspects of U.S. taxation practices constitute additional difficulties to
foreign investment in the U.S. market. These are mainly related to the nature
of reporting requirements and conditions for deductibility of interest
payments.
11. Trade Barriers in India for EU
European Union
◦ Viability of an FTA
◦ Negotiations in June 2007 and, so far, eleven
negotiating rounds have been held. The last EU-India
Summit took place on 10 December 2010 in Brussels.
Burdensome licensing requirements
◦ The provisions stipulate prior security clearance and
technology transfer requirements, as well as an
obligation to substitute foreign engineers with Indian
ones in telecommunication industry.
India restricting exports of cotton
12. Trade Barriers in India for EU contd.
Standards ,Testing, Labeling and Certification
◦ In 2009, the GOI revised its mandatory
certification compliance list, which now
includes 85 specific commodities like gas
cylinders, dry cell batteries.
◦ Products on the mandatory certification list
must be certified for safety by the Bureau of
Indian Standards (BIS) before the products are
allowed to enter the country.
13. Trade Barriers in India for US
Import Licensing
◦ Banned Items( Oils from Animal origin)
◦ Items Requiring License (Chemicals)
◦ Canalized items (Petroleum products)
Customs Procedures
◦ Motor vehicles may be imported through only three
specific ports and only from the country of
manufacture.
Sanitary and Phytosanitary (SPS) Measures
Export Subsidies
Intellectual Property Rights(IPR) Protection
◦ US retained India on the "Priority Watch List"
14. Service Barriers
Banking
◦ a direct branch,
◦ a wholly-owned subsidiary,
◦ or through a stake in a private Indian bank.
Audiovisual and Communications Services
◦ experience difficulty in importing film/video publicity
Accounting
◦ professional accountants should be graduates from India.
◦ Foreign accounting firms can practice if their home country
provides reciprocity to Indian firms
Construction, Architecture, and Engineering
◦ offered only on a nonconvertible rupee payment basis
Distribution Services
◦ Retail sector
15. Trade Barriers in India for
Pakistan
Need for a better mobile connectivity to
improve communication for business and trade
Relay of television channels
Opening up of bank branches on reciprocal
basis
Pakistan would switch over to negative list of
items for trade with India rather granting MFN
status
16. Trade Barriers in India for
Bangladesh
In Sept 2011, India announced to remove
46 textiles lines, of interest to Bangladesh,
from India's negative list for the least
developed countries under the South Asia
Free Trade Area Agreement (SAFTA).
17. General Investment Barriers
Equity Restrictions
◦ The government continues to prohibit or severely
restrict FDI in certain politically sensitive sectors, such
as agriculture, retail trading, railways, and real estate.
Investment Disputes
◦ India’s poor track record to date in honoring and
enforcing agreements with investors in the energy
sector has discouraged further investment in this
important sector.
18. FTA partners of India
India has signed FTAs or similar bilateral
agreements with a number of countries
including Sri Lanka,Thailand, Singapore, South
Korea and Chile, as well as the Mercosur
countries (Argentina, Paraguay, Uruguay and
Brazil), ASEAN and the South Asian Association
for Regional Cooperation (SAARC).
19. Global Enabling Trade Report
The Enabling Trade Index measures the factors,
policies and services that facilitate the trade in
goods across borders and to destination. It is
made up of four sub-indexes:
◦ Market access
◦ Border administration
◦ Transport and communications infrastructure
◦ Business environment
Parameters for an ambitious FTA were set out in the report of the EU-India High Level Trade Group in October 2006, which was tasked with assessing the viability of an FTA between the EU and India.
MFA quotasMulti-Fibre Arrangement (MFA) is a system of quotas on textiles andapparel exported from developing countries to developed countries. Underthis scheme, importing countries negotiate a series of bilateral voluntaryexport restraints on textile and clothing items with exporting countries