Accredited certification, a tool for the development of international trade
As trust is a crucial factor in global trade, accredited certification becomes an important tool for market confidence in product characteristics and services.
This is what come up from the research “International trade, the value of accreditation and standardization”, realized on behalf of Accredia, the Italian Accreditation Body, by two full professors in economics coming from leading Italian universities.
Presented the 14th of May in Rome, the research analyses the effects on international trade of non-tariff measures (NTM), defined as production or product requirements on imported goods and services and how Quality Infrastructure deals with them. Quality Infrastructure (QI) is the reference framework necessary to ensure and demonstrate to the markets the quality of products and services that empowers any form of economic integration. It consists of accreditation, conformity assessments, standardization and metrology.
NTM can lead to increased costs for accessing foreign markets but they are often used in developed countries to protect legitimate interests such as safety, health and the environment.
Moreover, differently from tariff measures as custom duties, NTM can produce a positive effect on international trade through an increase in the trustworthiness concerning the input specifics for companies and consumer goods for citizens. This is possible when the use of international standards and accredited certifications reduces commercial costs, with advantages both for companies, which avoid uneven and non-transparent procedures to adequate productions to the import country regulation and for consumers who can benefit from price reductions and a wider range of goods and services imported.
The functioning of conformity assessment as a boost for international trade is based on the recognized equivalence of accredited conformity assessment performed in different countries, whose reliability level is guaranteed by a rigorous peer review system the accreditation bodies are subject to. ABs that successful obtain the status of signatories of the multilateral agreements make the accredited conformity assessment valid in every Country in the mutual recognition network.
As an example of excellence, Single Market in Europe represents the most advanced form of economic integration and Quality Infrastructure plays a fundamental role in coordinating national regulations. This framework ensures a level playing field for European companies stimulating innovation and competitiveness: according to European Commission estimates, the integration of European markets has increased GDP by over 300 billion euros and created 2.8 million jobs, between 1992 and 2006.
The recent regional agreements stipulated by the European Union deals with non-tariff measures and the equivalence of the certification procedures. These aspects are stated in specific annexes recalling the Institutions of Quality Infrastructure. The Comprehensive Economic and Trade Agreement with Canada (CETA) entered into force at the end of 2017, introduced the equivalence of certification results and tests performed by accredited Bodies and Laboratories on specific product categories, subsequently Italian companies recorded an export growth towards Canada of 4.5% in 2018, equal to 10% in the textile-clothing and machinery sectors.
With reference to the agreement with South Korea, the first signed by the European Union with an Asian country, certainly it also contributed to the facilitation of trade between Italy and South Korea. The growth of Italian exports in this market stood at 18% in the years 2011 to 2017 that is to say the double with respect to our level of trade worldwide.
In a period in which multilateral agreements are stuck PTA’s regulates NTM as these have a relevant impact on trade flows. If correctly coordinated, national regulations could bring a positive effect on exports.
As part of the Quality Infrastructure, accreditation ensures product quality and represents one of the pillars on which international trade rests. This is why companies choose an accredited certification to satisfy and “signal” to the market specific requirements of reliability and quality. As the research pointed out, certified companies that join Italian value chains in the textile and clothing sector have experienced a 30%-60% productivity growth.
In conclusion, the path of agreements (PTA’s), of mutual recognition and coordination of national rules is fundamental in facilitating a positive market integration with pros for companies and citizens.