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Law360 (April 27, 2020, 7:36 PM EDT ) The World Trade Organization said in a Monday report that more export restrictions should be lifted on medical supplies needed to combat the coronavirus pandemic, suggesting that countries can use trade agreements to remove restrictions.
The WTO said that medical supplies traded through regional trade agreements are subject to an average tariff rate of 1.6%, which is lower than the average tariff rate of 3.8% on medical products traded outside of regional trade arrangements.
Trade agreements can lift trade barriers in ways other than lower tariff rates by removing rules-of-origin requirements on businesses and creating uniform quality standards for drugs and medical devices, the WTO said.
"WTO members have negotiated and signed bilateral [mutual recognition agreements] recognizing conformity assessment done by regulatory authorities in other members," the WTO said. "Such MRAs can speed up the provision of critical supplies and reduce the cost of conducting inspections of sites in other countries."
But the WTO noted that regional trade agreements can create more barriers depending on the provisions included in the deals, such as rules of origin that require companies to import what can be a high percentage of supplies for their products from a certain country.
Earlier this month, the WTO released a report showing that personal protective equipment crucial to fighting COVID-19 faces global tariffs averaging 11.5% with certain nations collecting duties as high as 65% on items like hand sanitizer.
After the report was released, the WTO along with the World Customs Organization urged government leaders to refrain from overly burdensome trade restrictions on medical supplies needed to combat the novel virus.
The WTO warned that global trade could drop as much as 32% as a result of the coronavirus outbreak, creating the greatest dip in international commerce since World War II.
But the WTO said last week that countries are piling export restrictions on items such as face masks, ventilators, gloves and hand sanitizer and are not reporting the changes to the organization, making product procurement difficult.
--Additional reporting by Alex Lawson and Amanda James. Editing by Jack Karp.
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