The Trade Facilitation Agreement and Agri-Food Global Value Chains: Three Key Insights from Recent CAPTS Research

By Carlos Zurita

The Trade Facilitation Agreement (TFA), brokered by the World Trade Organization (WTO), entered into force on February 22, 2017. Initial projections estimated that its full implementation could generate global trade gains ranging from $750 billion to $1 trillion annually (WTO 2015). The TFA is organized into three sections outlining WTO members’ obligations and implementation flexibility, as shown in Figure 1. Section I establishes a set of best practices aimed at reducing international trade costs by eliminating redundant procedures, aligning national rules with international standards, promoting uniform practices, adopting modern systems, and ensuring transparency in trade processes (WTO 2023). These provisions are particularly relevant to agri-food global value chains (GVC), where intermediate goods often traverse multiple borders, sometimes re-entering the same country (Balié et al. 2019; Greenville et al. 2017; OECD 2018). In our recently published paper, Assessing the Impact of the Trade Facilitation Agreement on Agri-Food (Zurita & Steinbach 2025), we explore the relationship between the implications of common TFA measures notified as implemented between countries on agri-food GVC participation.

Figure 1. Structure of the Trade Facilitation Agreement

While the TFA could increase GVC participation by reducing trade costs, the full implementation of its provisions could be costly for WTO developing country members. A key example of provisions that can involve significant upfront costs is the implementation of a single window system, as outlined in Article 10 of the TFA. Implementing such a system typically demands investment in IT infrastructure, with estimated costs ranging from $4 to $22.6 million (Moïsé 2013). This platform enables traders to submit all necessary import, export, and transit documentation in one place, streamlining interactions with multiple border agencies. Other TFA provisions, especially those requiring coordination among various government entities, may entail comparable expenses and operational challenges, including ongoing user training. A full list of the articles in Section I of the TFA is available in Table 1. TFA reforms can generate benefits over the long term, but the initial investments and ongoing costs may reduce net gains in the short term. A full list of the 12 articles analyzed in our study is available in Table 1.

Table 1. Articles in Section I of the Trade Facilitation Agreement

Article No.	Description
Article 1	Publication and Availability of Information
Article 2	Opportunity to Comment, Information before Entry into Force, and Consultations
Article 3	Advance Rulings
Article 4	Procedures for Appeal or Review
Article 5	Other Measures to Enhance Impartiality, Non-Discrimination and Transparency
Article 6	Disciplines on Fees and Charges
Article 7	Release and Clearance of Goods
Article 8	Border Agency Cooperation
Article 9	Movement of Goods Intended for Import under Customs Control
Article 10	Formalities Connected with Importation, Exportation, and Transit
Article 11	Freedom of Transit
Article 12	Customs Cooperation

Our paper presents three main takeaways. First, higher levels of common TFA implementation between importers and exporters do not necessarily lead to greater agri-food GVC participation. Developing WTO members have the flexibility to choose the order in which they implement TFA provisions. When countries prioritize measures with lower perceived implementation costs, they are more likely to see immediate benefits. However, reaching higher levels of TFA implementation eventually requires adopting more complex and costly measures, which can reduce short-term gains as these costs are gradually recovered. Our results show that after five years of the TFA’s entry into force, when importers and exporters have jointly implemented more than 50% of the Agreement’s provisions, there is evidence of a negative impact on agri-food GVC participation.

Second, we find that only three of the twelve articles in Section I of the TFA, Articles 6, 7, and 9, are associated with increased agri-food GVC participation. Increasing the common implementation of these articles by 10 percentage points increases agri-food GVC flows between 2% and 5%. These three articles generally require relatively minor procedural adjustments. In contrast, five articles, Articles 1, 5, 8, 10, and 11, are associated with lower levels of GVC participation. Increasing the common implementation of these articles by 10 percentage points reduces agri-food GVC flows between 1.2% and 6.8%. The measures in these five articles involve, among other things, publishing trade-related information online, establishing a single window system, and enhancing cooperation between neighboring border agencies. As such, they tend to be among the most difficult to implement, requiring substantial infrastructure investments and coordination across domestic and international institutions (Moïsé 2013; Kieck 2020).

The third key takeaway from our paper is that any observed positive effects from implementing individual TFA provisions may reflect broader WTO membership rather than the TFA itself. Since all TFA signatories are also WTO members, short-term gains may be driven by trade facilitation rules already in place under existing WTO commitments. In our analysis, the provisions most consistently linked to negative outcomes are also those associated with high implementation costs and administrative complexity. This suggests that, in the short term, the effects of TFA implementation are shaped less by the agreement’s overall structure and more by the cost and difficulty of specific measures.

Although our analysis covers only the first five years following the TFA’s entry into force (2017–2021), a relatively short period, it offers important insights into the evolving global trade landscape and the benefits observed to date. Moreover, it highlights key considerations for the design of future trade agreements, particularly those looking to include similar implementation flexibilities for developing country signatories. As future trade agreements consider incorporating similar measures, careful attention should be given to the financial and institutional burden they may impose on less-resourced signatories.

References

Balié, J., Del Prete, D., Magrini, E., Montalbano, P., & Nenci, S. (2019). Does trade policy impact food and agriculture global value chain participation of sub‐Saharan African countries?. American Journal of Agricultural Economics, 101(3), 773-789.

Greenville, J., Kawasaki, K., & Beaujeu, R. (2017). How policies shape global food and agriculture value chains. OECD Food, Agriculture and Fisheries Working Papers, 100. OECD Publishing

Moise, E. (2013). The Costs and Challenges of Implementing Trade Facilitation Measures. OECD Trade Policy Papers, 157. OECD Publishing.

Kieck, E. (2020). Trade Facilitation and Customs. In Handbook of Deep Trade Agreements, edited by A. Mattoo, N. Rocha, and M.  Ruta, Chapter 10, 294–317. World Bank.

OECD. 2018. Trade Facilitation and the Global Economy. OECD Publishing.

World Trade Organization. (2015). Speeding up Trade: Benefits and Challenges of Implementing the WTO Trade Facilitation Agreement. World Trade Report 2015. WTO Geneva.

World Trade Organization. (2023). Trade Facilitation. https://www.wto.org/english/tratop_e/tradfa_e/tradfa_e.htm/.

Steinbach, S., & Zurita, C. (2025). Assessing the impact of the Trade Facilitation Agreement on agri-food global value chain integration. The World Economy, 1-27.