14 th Meeting of APMP Developing Economies Committee

14 th Meeting of APMP Developing Economies’ Committee (DEC) Xi ‘An, 10 June 2006 UNIDO’s TRADE CAPACITY BUILDING INITIATIVE and METROLOGY ACTIVITIES IN ASIA Ouseph Padickakudi Programme Manager Trade Capacity Building Branch tcb@unido. org

TRADE CAPACITY BUILDING tcb@unido. org PRESENTATION OVERVIEW: • Trade challenges and opportunities • Tariffs replaced by non-tariffs • TBT- SPS agreements • Trade barriers facing developing countries • UNIDO 3 C’s approach • UNIDO Metrology Activities in Asia • UNIDO – WAITRO Initiative: LABNET Portal • Conclusions

TRADE CAPACITY BUILDING tcb@unido. org UN Specialized Agency with three thematic areas: • Trade Capacity Building • Poverty Reduction through Productive Activities • Energy and Environment

TRADE CAPACITY BUILDING tcb@unido. org Global Trade Growth & Marginalisation World exports, 1980 -2004 (US$ billion) § Total global trade 76% in manufactures (Industrial goods) § Share of developing countries in global trade only 26% § Every 1% growth in Trade, LEADS TO one-half % Income increase

TRADE CAPACITY BUILDING tcb@unido. org Global Trade Challenges TARIFFS REDUCED - OTHER BARRIERS “for 168 out of 216 US trading partners, transport cost barriers clearly outweigh tariff barriers. For the majority of Sub-Saharan African countries, tariffs amounted to less than 2%, while transport cost incidence often exceeded 10%. Since the introduction of AGOA, transport costs have risen relative to tariffs. World Bank Trade Note 15; May 10, 2004 US$ 1. 75 bn. exports from developing countries have been disrupted in 2004, due to SPS non-compliance. While only US$ 53 mn. spent by donors on SPS support. World Bank 2004, Steven Jaffee & Spencer Henson, Standards and Agro-Food Exports from Developing Countries – Rebalancing the Debate COST OF COMPLIANCE TO FOOD SAFETY RULES - UNIDO Estimates Shrimp exports to the EU - Testing and Compliance cost adds 2. 8% Enterprise Quality/safety set up cost – adds 5% to product cost National Quality & Testing infrastructure – US$ 5. 0 mn. to US$ 25. 0 mn.

BUILDING BLOCKS FOR EFFECTIVE GLOBAL TRADE - UNIDO APPROACH SUPPLY ENT VELOPM DE & (Capacity s) etitivenes Comp UNIDO Compete EXPORT PROMOT ION (& Market Opportun ities) ITC (AGOA + E BA) DS & TANDAR S ITY ONFORM C NT ASSESSM RE TRUCTU INFRAS S) (TBT, SP UNIDO Conform INVESTM ENT FACILITA TION FINANCIA L FLOWS UNCTAD UNIDO S CUSTOM S RE ROCEDU P ATION NSPORT TRA TION UMENTA DOC , IMO UNCTAD Connect INTERNA TIONAL AGREEM ENTS & RULES F OR TRAD E WTO

TRADE CAPACITY BUILDING tcb@unido. org UNIDO’s TCB Approach: The 3 Cs ü“Countries must have marketable products for export” COMPETITIVITY of productive capacities ü“Products must conform to requirements of clients and CONFORMITY markets” with standards ü“Rules for trade applied and simplified cross border transactions” CONNECTIVITY Compete 3/18/2018 to markets Conform Connect

TRADE CAPACITY BUILDING tcb@unido. org Trade Capacity Building: Key Inputs Productive Supply Capacities (UNIDO) • Industrial policy and supportive institutional structure • Investment and technology transfer • SME development and access to finance • Productivity and quality • Industrial upgrading, sectoral technology support • Cleaner production, energy efficiency Standards & Conformity Assessment (UNIDO) • Development and harmonization of standards • Development of testing services including RM & PT • Certification and accreditation schemes • Training of auditors and inspectors • Calibration chain Integration into the MTS (WTO, UNCTAD, ITC, WB) • WTO rules, negotiations • Trade facilitation (customs, documentation) • Infrastructure (transport, ports)

www. unido. org TBT /SPS Agreement (Jan 1995) TBT – Agreement on Technical Barriers to Trade SPS – Agreement on Application of Sanitary & Phytosanitary Measures ü Recognises country rights to ensure: § Quality of imports/exports, Product Safety § Protection of human, animal, plant life, health, environment ü Aims to prevent standards/technical regulations creating obstacles to trade ü Recognises special problems of developing countries in this area ü Members shall, if requested. . . grant assistance to developing country members Key Challenges: ü Developing countries lack capacity to implement agreements ü Conformity assessment technology and standards evolve ü More technical assistance is needed

TRADE CAPACITY BUILDING tcb@unido. org WTO ACCESSION REQUIREMENTS

Forming Strategic Partnerships for Trade Capacity Building

UNIDO - WTO Agreement September 2003 “The WTO – UNIDO agreement is a formal recognition that assisting developing countries to build capacities to produce exportable goods is an important part of “trade-related” technical assistance and capacity building” Cancun, September 2003 The resulting technical cooperation programme involves focus on: § Supply Chain Constraints § Lack of Conformity Capacity to Int’l Standards and Technical Requirements § Marginalization in the Multilateral Trading System Pilot countries involved are Armenia, Cambodia, Cuba, Egypt, Ghana, Kenya, Mauritania.

UNIDO - ISO Agreement December 2003 Cooperation to ensure that LDCs, developing countries and economies in transition will be able to reap the benefits of the world trading system which is made freer and fairer based on international standards. The team work will focus on awareness creation and competency building in the respective countries. This will materialize through workshops, seminars and training on standards development.

UNIDO - ILAC Cooperation May 2004

TRADE CAPACITY BUILDING tcb@unido. org BIPM - OIML • Draft Mo. U signed • UNIDO - JCDCMAS Joint Committee on Coordination of Assistance to Developing Countries in Metrology, Accreditation and Standardization (JCDCMAS) UNIDO is currently holding the JCDCMAS Secretariat for two years, 2006 -2007

TRADE CAPACITY BUILDING tcb@unido. org “Fair Trade for All”: Priority Areas to meet Product Standards Requirements • “Developing countries lack the ability to assist their producers to meet product standards, which often act as a barrier to developing country exports • Significant assistance from developed countries is required to build up their capabilities to conform to product standard requirements” “UNIDO recommends the following priority areas for assistance 1. A national/regional standards/standardization body 2. A national/regional metrology system 3. A certification/conformity assessment system 4. An accreditation system” Source: J. Stiglitz & A. Charlton, Fair Trade for All – How Trade can promote Development, Oxford University Press, 2005

TRADE CAPACITY BUILDING tcb@unido. org

TRADE CAPACITY BUILDING tcb@unido. org METROLOGY - a requirement for: Scientific Research: Accurate calibration of scientific instruments Food Safety: Calibrated thermometers, balances, a requirement Laboratory Accreditation: Calibration status of test equipment a requirement under ISO 17025 ISO 9001, ISO 14001 certification: Calibration status of equipment a clause under ISO 9001, ISO 14001

TRADE CAPACITY BUILDING tcb@unido. org TCB PROJECT PORTFOLIO Total funding for TCB recent & ongoing projects: US$ 78. 45 mn. SIGNIFICANT FUNDING MOBILIZED

TRADE CAPACITY BUILDING tcb@unido. org UNIDO Metrology Activities in Asian Countries AFGHANISTAN MALDIVES BANGLADESH NEPAL BHUTAN CAMBODIA Lao PDR PAKISTAN SRI LANKA VIETNAM

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Sri Lanka UNIDO’s SUCCESS QUOTED Sri Lanka Project Typical TRTA Case Study WTO/OECD Report on Trade-Related Technical Assistance and Capacity Building (TRTA/CB) Box 3: Sri Lanka - Quality, Standardization and Metrology Project UNIDO The Quality, Standardization and Metrology (QSM) Project, funded by Norway (US$ 1. 8 million) and UNIDO (US$ 500, 000), which aims to develop the metrology, testing and ISO 14000

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Sri Lanka § Laboratories accredited in Sri Lanka through • Microbiology (2) • Chemical Testing (2) • Garment/Textile (1) • Metrology (1) • Rubber testing (1) (assessment January 2007) • Food Testing (1) (assessment January 2007) § Support to environmental conditioning (USD 120, 000) § Training expertise provided § Total: US$ 1. 8 mn.

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Sri Lanka Sustainability ITI Sustainability assured Chemical and Microbiology Lab. Industrial Metrology Lab. – New accreditation fees paid by labs – Income rising, number of services increasing sustainable

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Sri Lanka Sustainability TT&SC Laboratory Performance (2002 -2005) Number of tests Income (LKR 1, 000) 80% of revenues are derived from the Private Sector testing activities

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Sri Lanka Laboratories targeted for accreditation to ISO/IEC 17025: 2005 Food Testing Laboratory: § Histamine in Fish § Lead, Arsenic, Mercury & Cadmium in Fish § Vitamin A in Milk powder § Vitamin E in Margarine Metrology Laboratory (expanded): Rubber Product Testing Laboratory: § IRH Hardness § Shore A Hardness § Heat ageing § Change in volume (Effects of liquids) § Density § Dimensions § Abrasion Test § Tensile Properties § Calibration of digital multimeters § Calibration of volumetric glassware by the gravimetric method § Calibration of Gauge Blocks § Calibration of micrometers (External measurement) § Calibration of Micrometers (Internal measurement) § Calibration of Vernier Calipers § Calibration of Dial Gauges § Calibration of Meter rules

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Pakistan National Physical & Standards Laboratory (NPSL) Lab upgrading, international accreditation, etc. : • Expertise for assessing gaps against ISO 17025 standard • Accreditation of calibration services • Provision of equipment (mass comparator, weights, etc. ) • Study tours to NPL (UK), Sri Lanka, Malaysia on environmental conditioning • Support to environmental conditioning (€ 200, 000) • Proficiency testing scheme participation 3/18/2018

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Pakistan Laboratories targeted for accreditation in Pakistan through (19 public sector testing laboratories) § Microbiology (6) § Chemical (6) § Metrology (1) § Textiles and leather (5) § Electrical (1)

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Vietnam Laboratories targeted for accreditation in Vietnam through (assessment first quarter of 2007) § Metrology (4) § Microbiology (1) § Chemical (1) § Food Testing (1) § Textile (1)

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Vietnam Metrology Laboratories targeted for accreditation to ISO/IEC 17025: 2005 through: Quality Assurance and Testing Centre 3 (QUATEST 3), Ho Chi Minh City § Mass Measurement laboratory § Temperature Measurement laboratory Vietnam Metrology Institute (VMI), Hanoi § Mass Measurement laboratory § Temperature Measurement laboratory

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Vietnam Testing Laboratories targeted for accreditation to ISO/IEC 17025: 2005 through: Quality Assurance and Testing Centre 1 (QUATEST 1), Hanoi § Textile testing laboratory: Carries out physical and compositional testing of textiles and garments. Quality Assurance and Testing Centre 3 (QUATEST 3), Ho Chi Minh City § Food testing laboratory: Carries out a wide range of testing of products, food animal feedstuffs. § Microbiology testing laboratory: Carries out tests on fruits & vegetable products, fish & fish products, milk & milk products, and water. National Fisheries Quality Assurance and Veterinary Directorate Branch 1 (NAFIQAVED 1), Hai Phong City § Microbiology testing laboratory: Carries out tests on fish & fish products, and potable water.

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Cambodia

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Cambodia and Lao PDR • • • Metrology legal framework put in place Metrology laboratories developed Chemical & microbiology labs developed Equipment supplied Staff trained • Legal metrology launched by UNIDO

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Bangladesh BANGLADESH QUALITY SUPPORT PROGRAMME Bangladesh Standards and Testing Institute (BSTI) capacity strengthened through: - upgrading of laboratory equipment (30 years old) - USD 700, 000 - assistance to comply with ISO 17025 requirements - participation in inter-laboratory comparisons - provision of staff hands-on training and overseas fellowships - support to achieve international accreditation

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Nepal EC - NEPAL ASSISTANCE PROGRAMME Nepal Bureau of Standards and Metrology (NBSM) capacity strengthened through: - support to laboratory environmental conditioning - critical laboratory equipment gaps closed - assistance to comply with ISO 17025 requirements - participation in inter-laboratory comparisons - provision of staff hands-on training and overseas fellowships - support to achieve international accreditation

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Afghanistan SUPPORT FOR ESTABLISHING THE AFGHAN NATIONAL STANDARDS AND METROLOGY AUTHORITY Legal and institutional framework for quality, standardization, metrology and testing established in the country, through the Afghanistan National Commission on Standards, Metrology and Quality (NCSMQ): - assistance in the development of metrology and standards laws provided - metrology laboratory designed - mobile testing laboratory developed

TRADE CAPACITY BUILDING tcb@unido. org Metrology Projects in ASIA: Bhutan and Maldives MARKET ACCESS AND TRADE FACILITATION SUPPORT FOR SOUTH ASIAN LDCs, THROUGH STRENGTHENING INSTITUTIONAL AND NATIONAL CAPACITIES RELATED TO STANDARDS, METROLOGY, TESTING AND QUALITY - National standards and metrology organization for Bhutan and Maldives established - training expertise provided - laboratory equipment gaps identified and selected legal metrology equipment supplied

TRADE CAPACITY BUILDING tcb@unido. org LABNET: PORTAL http: //www. vimta. com/projects/labnet_recent A UNIDO & WAITRO Initiative Laboratory Development ‘CONCEPT TO REALIZATION’ Partners: BIPM, ILAC, ISO

TRADE CAPACITY BUILDING tcb@unido. org LABNET: PORTAL Vision • A one stop shop for all lab related development & information activities • Customized info by lab types • Act as a common platform wherein students, scientists, experts, entrepreneurs & vendors can share their knowledge and expertise • Provide seamless access to a range of lab related information resources for users throughout the world • In a nutshell, it will be a comprehensive online guide for all lab related activities

TRADE CAPACITY BUILDING tcb@unido. org LABNET: PORTAL Features • Broad array of resources and services brought together to one single source • Sense of community • Dynamic interface integration • Integrated email alert functionality • Interactive discussion forum • Revenue generation features • Event & Training Calendar • Optimized search engine integrated

TRADE CAPACITY BUILDING tcb@unido. org LABNET: PORTAL Benefits Users and beneficiaries of LABNET features: • • • Registered Users – Access to: • Knowledge base • Jobs & Trainings, etc. Laboratories – Guide for: • Accreditation process • PT programs • Lab development, etc. Vendors – Showcase: • Major lab equipment • Support equipment e. g. lab furniture etc. • Experts – Provide: • Consulting opportunities • Knowledge sharing • Networking, etc. • Member Organsations – Offer: • PT Programmes • Training Sessions • HR Management, etc.

TRADE CAPACITY BUILDING tcb@unido. org CONCLUSIONS ü TCB: a holistic approach to Trade Development - the 3 Cs ü Supply Competitivity ü Demand Conformity ü Market Connectivity ü Metrology – important for: ü Precision/Quality ü Accreditation ü Certification ü Testing ü Willing partner for APMP activities in the region

Thank You tcb@unido. org