International Road Union: Free trade can help stabilise the Middle East
Beirut - The free flow of trade contributing to economic development could help the Arab world’s many woes and bring peace and stability to the restive region, said the International Road Transport Union (IRU), which introduced International Road Transport (TIR) system in the 1940s to help a war-torn Europe rebuild devastated trade links.
IRU Secretary-General Umberto de Pretto said an integrated Arab land transport is essential for achieving unity and inter-regional dynamic trade, a matter in which the Middle East lags far behind.
“When we look at the Arab world and the state of trade within the region, some of the figures are quite shocking in the sense that only 9% of trade in the Arab world is between the Arab world countries; otherwise it is with other parties and economies,” de Pretto said.
“We want to bring hope to the youth. If I have no hope, I will fight but if I have hope, I would have a family, a future, a job. I am convinced that the solution is trade and tourism, that is, if we get the economies going, it will bring hope to people,” he said after signing a Memorandum of Understanding (MoU) on cooperation in transport and trade-related issues in the Arab region with the UN Social and Economic Commission for Western Asia (ESCWA) in Beirut.
“Our mission is to reduce the cost of trade and make it easier for businesses to do business. That is on one hand what we are going to try to achieve through this MoU and we must achieve it for the Arab world.”
De Pretto acknowledged the challenges posed by conflicts in the Middle East.
“What is required, first and foremost, is the political will,” he said, arguing that Arab countries, which need to enhance their security because of conflict and instability in the region, will find in TIR the most secure system for cross-border movement of goods.
“First, we need to target those [Arab] countries that we believe if we have them moving on this, it will have influence on the entire region. We know that the GCC [Gulf Cooperation Council] countries have decided to collectively join the TIR system, which would give a great impetus to facilitating trade,” de Pretto said.
With TIR, goods are shipped in sealed load compartments and the contents are detailed on a TIR carnet. The document accompanies the driver and the cargo. Customs simply has to verify the carnet and that the seals are intact, rather than opening the container and physically inspecting the contents, and report the transit via a computer system.
De Pretto pointed out that IRU’s activity in the Middle East is focused on raising awareness and highlighting the benefits of the implementation of TIR. He said his organisation’s objective is to encourage countries to opt for this system over other local choices because that will contribute to economic development and regional integration.
A study by IRU on trade within the Arab region concluded that 56% of transport time is lost at borders and up to 40% of transport costs are bribes.
“It means that trucks reach the border and just wait there. It creates an environment that is conducive to corruption because you have an incentive to give baksheesh (tip or bribe) in order not to wait days and weeks,” de Pretto explained.
“With the TIR system, you actually send an electronic pre-declaration in advance to the Customs saying I am coming and therefore there is nothing to check and the truck goes right through and thus nobody can touch anything.”
Stressing the importance of moving ahead with the TIR system, the IRU official said: “What we need is a political leadership… presidents saying this is right for my country, this is right for the region and we must remove barriers and end corruption, because this is the only thing that will drive trade, economies and the whole region.”
In a region where borders are tightly controlled and movement of people and goods faces many restrictions, it is hard to imagine a free flow of trade and visitors. Borders are sometimes used as a political tool to pressure governments. For instance, since the Syrian troop withdrawal from Lebanon in 2005, Syria has used the flow of goods and people across the border as a way to pressure Lebanon.
De Pretto said the Arab world needs “global instruments that would first and foremost help trade between themselves and also extend and facilitate their trade with others”.