Streamlining Non-tariff Measures for Agri-food Trade in ASEAN

Streamlining non-tariff measures (NTMs) plays an important role in improving market access for trade in goods among ASEAN-10 countries. An assessment of the impact of NTMs in ASEAN reveals that the agri-food trade has been constrained by contingent trade protective measures, quantity-control measures, technical barriers to trade (TBT), and sanitary and phytosanitary (SPS) measures. The proliferation of SPS and TBT measures, coupled with their severe effects, suggests the need to accelerate NTM reforms in ASEAN.

Non-Tariff Measures and the Quality of Imported Products

Legitimate reasons for the imposition of non-tariff measures (NTMs) within regulations have triggered their extensive use. Among these measures, technical barriers to trade (TBTs) and sanitary and phytosanitary (SPS) measures allow countries to impose restrictions on the import of low-quality products suspected of harming domestic consumers’ health, plant life, or the environment. This paper analyses two regulative and standard-like NTMs – TBTs and SPS measures – and the quality of traded products that is driven by their imposition, which is a general underlying motive for the adoption of such regulations. A dummy variable measuring the existence of these NTMs and a count variable indicating their stringency are used in the analysis. Moreover, two other variables indicate flows of NTMs imposed in each year and stocks of these NTMs accumulated over years. The results indicate that TBTs and SPS measures do indeed imply a higher quality of traded products. Stringent TBTs with more regulations imposed in each year (i.e. flows of count TBTs) have the largest impact on the quality of traded products. However, for SPS measures, only the existence of a regulation (i.e. the dummy variable on flows of SPS measures) on a traded product has the strongest impact on its quality.