TBT Agreement Promotes Production of Quality Goods for Export

Implementation of Technical Barriers to Trade (TBT) not only promotes producing quality goods but also restricts import of cheap and low quality goods that are harmful for people and the national economy.

Nepal’s membership of the WTO in April 2004 has harnessed its integration into the international economy. It has aimed to establish an enabling environment for the private sector thus fostering improvement in competitiveness. Technical Barriers to Trade (TBT)--an agreement within the framework of the WTO—assures the quality production of goods for export that helps to promote Nepal’s international trade.

What is Technical Barriers to Trade?

Technical Barriers to Trade is a protective measure applied by the government to protect its domestic producers from foreign influx of goods. The Government of Nepal (GoN) applies domestic regulatory process that allows limited entry of products from other countries. In addition, TBT is Non-tariff Barriers and measures (NTBs) other than border tariffs affecting trade in goods, services and factors of production. TBT is rule for product weight, size, packaging, ingredient or identity standards, mandatory labeling, shelf-life restrictions, and import testing and certification procedures.

The aim of the TBT Agreement is to insure that technical regulations, standards and conformity assessment procedures, do not create unnecessary obstacles to international trade. In addition, the agreement allows adequate regulatory discretion, to protect human, animal and plant life and health, national security, the environment, consumers, and other policy interests of the member countries.

The TBT Agreement establishes rules and disciplines designed to prevent mandatory technical regulations, voluntary standards, and conformity assessment procedures from becoming unnecessary barriers to international trade. Nevertheless, the TBT Agreement seeks to allow members with sufficient domestic policy autonomy to pursue legitimate regulatory objectives.

How did Nepal sign the Agreement on Technical Barriers to Trade?

Agreement on TBT is one of the agreements within the World Trade Organization. The WTO was created with the aim of removing any form of barriers (both tariffs and non-tariffs) for international trade. Therefore, TBT, as one of its agreements, serves the function of taking out those product quality barriers.

The WTO Agreement on T BT entered into force in 1995 which was the conclusion of the Tokyo Round of Trade Negotiation in 1979.  During the accession process to the WTO, Nepal agreed with the checklist of the Working Party in April 2000. In addition to Trade in Goods, Trade in Services and Intellectual Property Rights, TBT agreement is one of the mandatory obligations of the WTO. Therefore, Nepal adopted the principle of the Agreement on TBT as one of the ingredients of the WTO accession package on 23^rd April 2004.

What is the mechanism for monitoring Technical Barriers to Trade in Nepal? 

 

The government of Nepal has designated Nepal Bureau of Standards and Metrology (NBSM) as a national enquiry point. Since its establishment, the section has been notifying and publishing various information regarding TBT that include; national and international notice of standards, technical regulation and conformity assessment procedures and other concerned information. Presently, in that respect are three technical officers specially assigned to regulate this part.  

What are the benefits of the TBT Agreement for Nepal?

The Agreement on TBT offers Nepal with sufficient rights to restrict low quality products from being imported. The standards and technical regulations set at the world class levels protect domestic consumers. In addition, it also avoids unnecessary barriers to imported goods that will benefit the national economy.

Side by side, the agreement promotes national exporters to meet international criteria that boost them to produce quality goods for export.

Further, it also protects exporters against unnecessary TBT-related barriers in foreign markets.

What are the hurdles in implementing the Agreement in TBT?

We have not been able to utilize the benefit of the TBT Agreement because of our weak technological development. The lack of sufficient infrastructure at the border has allowed low quality products in the domestic market. In addition, the private sector has a lack of sufficient understanding of TBT provisions and has not brought these issues to the notice of the government. As a result, we have not been able to export quality products to the foreign markets and low quality products are easily entering domestic market.

Are there any technical assistance to improve technical standards, credibility and conformity assessment in Nepal?

Least Developed Countries (LDCs) including Nepal are liable to receive technical assistance from rich WTO member countries. Wealthy countries provide advice and technical assistance and they shall give priority to the needs of the least-developed country members.

Nepal has received technical assistance from the European Union to enhance its TBT and Sanitary and Phyto Sanitary (SPS) related capacity. The International Trade Centre (ITC) has also supported identify non-tariff barriers for some products in the context of Nepal’s Trade Integration Strategy.  

What is the future strategy of Nepal to get maximum benefit from the Agreement on TBT?

The Government of Nepal has launched NTIS 2010 as one of its trade strategy for consecutive five years. One of the objectives of NTIS 2010 focuses to strengthen capacity of GoN to coordinate and manage Trade Related Technical Assistance (TRTA) and Aid for Trade (AfT).

The Ministry of Commerce and Supplies (MoCS) has already secured funding from WTO under the Enhanced Integrated Framework (EIF) to manage TRTA and AfT to enhance TBT related capacities of the government. In addition, the government has planned to enhance monitoring TBT commitments under the support of Tier 1 funding mechanism of the EIF.