Globalization and protectionism is driving a new business paradigm for supply chains – a vigorous international debate on the parameters of free or preferential trade. From a strategic and global perspective, Brexit could be the first wave of de-globalization and growing populism in other nations. But President Trump’s driven agenda continues to cause turbulence worldwide as other countries look to strike bilateral trade agreements rather than stay in the previous regional ones.

With approximately 500 regional and preferential trade agreements now in place across the globe, companies can benefit from the lowered duty rates and trade barriers that come with these free trade agreements (FTAs). But managed ineffectively they also pose huge compliance risks. FTA information needs to be constantly updated to ensure accurate origin determination for making a claim.

Free trade agreements (FTAs) help countries export more outside their borders, gain better access to raw materials and vital components, and compete more successfully in the global marketplace. For India and European Union member states, the EU-India FTA faces a tough uphill battle. However, once that battle is overcome, the FTA will increase trade and opportunity between the two powerful regions.

India is an important sales market for Europe; with a population of 1.3 billion it is the fastest growing economy in the world and a key supplier of a wide range of goods and services for many EU partners.  Germany, ahead of India’s Prime Minister’s visit to Europe in late May, made a strong pitch for resuming negotiations for the EU-India FTA. Germany is one of many countries that India terminated its bilateral investment protection treaties (BITs) with, following the country’s release of a new BIT model in December 2015.

If 2016 taught us anything, it’s that the global supply chain can’t expect a continuation of the status quo, and even the surest predictions can be wrong. With last year’s tumultuous end in the rear-view mirror, global companies powering ahead into 2017 must be ready for regulatory change – both the predicted and unexpected.

Billed as a “major milestone for the global trading system”, the World Trade Organization (WTO) Trade Facilitation Agreement (TFA) entered into force on February 22, 2017. It is the first multilateral agreement concluded since the creation of the multi-country trade-focused body in 1995. The TFA negotiations concluded during the Bali Ministerial Conference in 2013, but finally went into force yesterday after two-thirds of its members ratified the agreement.

Amber Road has previously reported extensively on the Comprehensive Economic and
 Trade Agreement (CETA). Under negotiation for almost five-and-a-half years, CETA
was approved in a close vote by the Members of the European Parliament (MEPs) on 15 February 2017. It was signed by both the European Union and Canadian representatives in October 2016, and first received a positive recommendation from the EU International Trade Committee in the European Parliament (EP) on 24 January 2017.

On his first full weekday in office, President Donald Trump swiftly abandoned the Trans-Pacific Partnership (TPP) with an executive order, standing by his Inauguration speech that “now arrives the hour of action." President Trump also signed an executive order to renegotiate the North American Free Trade Agreement (NAFTA). The orders fulfill the pledge Trump made in mid-November to immediately make dramatic changes and put “America first” on his first day in office.

Looking to 2017 and beyond, the stakes for supply chain leaders continue to rise. Executives at the SCM World Live Americas conference next week will learn how Polaris is automating its global supply chain activity to address current and future challenges in digitization, globalization, and scalability:

• Eliminated or mitigated trade flow gaps
• Ensured quality trade procedures
• Optimized internal and third-party resource utilization

Using digital supply chain touch points and a new resource structure, Polaris has successfully created a strong foundation built for scale and flexibility. 

The original pioneer in cross-border elf-Commerce, North Pole Industries (NPI) has had to adapt with the times just like any other retailer. The key, Santa says, is investing in technology and making process changes in advance of the holiday season.

“We needed to brace ourselves against disrupters that could send our supply chain into a tailspin the night before Christmas,” says Santa, Chief Executive Elf of NPI.

To that end, NPI has worked to automate and track nearly all of its global trade operations with Amber Road’s Trade Automation solution suite. The first step was the most crucial in a deadline-based industry: automating NPI’s trade compliance processes to ensure that Santa’s sleigh doesn’t get caught up in Customs on its way to chimneys around the world. Amber Road’s Restricted Party Screening tool, backed up by its extensive Global Knowledge^® database, guarantees that only good little girls and boys are on the approved toy recipients list.

Global supply chains have been pulled tight, contracted, and at times broken during 2016. As we move into 2017, global trade management executives need to brace against disrupters that have the potential to send your supply chain into a tailspin: What will US trade policy look like? How can my supply chain handle new security risks? What, if anything, will happen to the TPP?

Join Amber Road's Global Trade Academy for our webinar, 2017: Bracing for Instability in Global Trade, on Wednesday, December 7, at 2PM EST to hear thought leaders answer a few of these questions.

Even with all of the potential free trade agreements (FTAs) companies can take advantage of, it’s little surprise that many U.S. importers are spinning when it comes to qualifying goods based on the restrictive regulations for sourcing inputs and raw materials.