TRADE FACILITATION TRENDS AND KEY COMPONENTS

1. TRADE FACILITATIONTRENDS AND KEY COMPONENTS P2P Learning Workshop on ASYCUDAWorld Livingstone, Zambia Fabrice Millet fabrice.millet@unctad.org

2. UNCTAD UNCTAD is the United Nations' body responsible for trade and interrelated development issues, serving governments and enhancing dialogue among stakeholders towards achieving prosperity for all UNCTAD makes policy recommendations on trade, finance, technology and investment based on development focused research and analysis As an intergovernmental forum, UNCTAD provides a platform where countries can debate and build consensus on policies best suited to overcome disparities and generate people-centred sustainable development UNCTAD is committed to helping developing countries to reach international development goals UNCTAD delivers tailor-made technical assistance to developing countries and economies in transition, and helps them build the capacities they need for fair integration into the world economy, and improve the well-being of their citizens UNCTAD believes that each country should have the policy space it requires to determine its development path. It advocates environmental sustainability, gender equality, and cultural diversity

3. PRESENTATION SCHEME • AUTOMATION HELPS HUMAN FORCE WITH REPETITIVE TASKS, AVOID ERRORS, STORE AND PROCESS LARGE VOLUME OF DATA • Trade Facilitation is about simplifying trade procedures and documents • Automation is about processing information (procedures) and stocking it (documents) • Automation is ideal for implementing Trade Facilitation • Examples: Customs clearance, trade statistics • ASYCUDA: ESSENTIAL TO CUSTOMS MODERNIZATION • ASYCUDA ASSIST COUNTRIES TO COPE WITH TF AGENDA

4. AUTOMATION HELPS HUMAN FORCE WITH REPETITIVE TASKS, AVOID ERRORS, PROCESS LARGE VOLUME OF DATA GOODS S B INFORMATION PAYMENT “Trade Facilitation is about simplifying trade procedures and documents”

5. Purchase Exportation Importation Bill of lading, Documentation Vessel Booking Request Confirmed Line of Credit Vessel Booking Confirmation Release/Approval Exporter’s Bank Importer’s Bank Bill of Lading Rated Bill of Lading Arrival Notice Original B/L, Invoice, PO, Packing List ImportTerminalOperator Fund Transfer Ocean Carrier Dock Receipt Demurrage guarantee & payment Line of CreditProforma Invoice Cargo Status LCConfirmation Export Terminal Operator Purchase Order Customs House Broker Exporter Importer Dock receipt Pick-up & Delivery Order Import Docs Proforma Invoice Pick-up & Delivery Order Release/HoldNotice Letter of InstructionInvoice, PO Inland Carrier Cargo Status Freight Forwarder / NVOCC Inland Carrier Manifest Customs ( Import ) Shipping & Funding Detail Dock receipt Export Declaration Marine Insurance Company Vessel Manifest Shipping & funding detail AES Export Declaration Port Converted Vessel Manifest Customs (Export) Importer Notice AUTOMATION HELPS HUMAN FORCE WITH REPETITIVE TASKS, AVOID ERRORS, PROCESS LARGE VOLUME OF DATA • 20 actors; • > 200 data elements; • Manual procedures; • Multiple data systems; • > 30 documents or messages.

6. AUTOMATION HELPS HUMAN FORCE WITH REPETITIVE TASKS, AVOID ERRORS, PROCESS LARGE VOLUME OF DATA AUTOMATION is ideal for Trade Facilitation = Data Warehouse + Internet Applications + Cloud Computing

7. AUTOMATION HELPS HUMAN FORCE WITH REPETITIVE TASKS, AVOID ERRORS, PROCESS LARGE VOLUME OF DATA • Enquiry • Order • Despatch advice • Collection order • Payment order • Documentary credit • Forwarding instructions • Forwarder's invoice • Goods receipt • Air waybill • Road consignment note • Rail consignment note • Bill of lading • Freight invoice • Cargo manifest • Export licence • Exchange control doc. • Phytosanitary certificate • Veterinary certificate • Certificate of origin • Consular invoice • Dangerous goods declaration • Import licence • Customs delivery note • TIR carnet • … Automation is ideal for: • Customs clearance • Multi-agency risk Management • Transit Monitoring • E-Payments • Goods Tracking • Trade statistics • …

8. PRESENTATION SCHEME • AUTOMATION HELPS HUMAN FORCE WITH REPETITIVE TASKS, AVOID ERRORS, STORE AND PROCESS LARGE VOLUME OF DATA • ASYCUDA: ESSENTIAL TO CUSTOMS MODERNIZATION • Customs clearance automation • Increase revenue collection some of which may be used to further improve Customs facilities and equipment • Smoothening/streamlining border crossing processes, also in ports and airports • Adopt and use international standards • Bring administrative processes to the level of most advanced private sector practice and technology • ASYCUDA ASSIST COUNTRIES TO COPE WITH TF AGENDA

9. ASYCUDA: ESSENTIAL TO CUSTOMS MODERNIZATION CustomsTime Release RiskAssessment International, Regional Norms and Standards NationalH.S. Integrated Tariff ICIS SingleWindow Post-auditControls “ASYCUDAWorld is the core of the Integrated Customs Information System”

10. ASYCUDA: ESSENTIAL TO CUSTOMS MODERNIZATION 2 GOV, IMF, WB GOV, ASYCUDA 1 Adopting modern, simple procedures, in particular movement from physical to post clearance control Establishing coherent trade policies and clear supporting legislation GOV, ASY, Trade ALL 4 3 Ensuring incentive and organizational structures conducive to integrity and effectiveness in Customs Shifting to substantial reliance on self-assessment by the trade operators “ASYCUDA achieves tangible economic and fiscal benefits” *Source IMF – Changing Customs, Challenges and Strategies for the Reform of Customs Administration

11. ASYCUDA: ESSENTIAL TO CUSTOMS MODERNIZATION OS UNIX, WINDOWS, OSX Integration ASYCUDA World Training IT Hardware SOCLASS RDBMS Telecom Hw & Sw JAVA Servers, PCs, Printers, UPS etc “ASYCUDAWorld is a powerful e-Government platform”

12. ASYCUDA: ESSENTIAL TO CUSTOMS MODERNIZATION“Inspire confidence, build trust” “ASYCUDAWorld development is driven by both Government and Trade Needs” Simple and smooth processing of formalities Means to allow goods to proceed promptly to their final destination A single control point for all public services Standard forms, assembled into a ‘single bunch of documents’, compatible with trade documents and transport contracts Predictable and transparent rules and procedures

13. PRESENTATION SCHEME • AUTOMATION HELPS HUMAN FORCE WITH REPETITIVE TASKS, AVOID ERRORS, STORE AND PROCESS LARGE VOLUME OF DATA • ASYCUDA: ESSENTIAL TO CUSTOMS MODERNIZATION • ASYCUDA ASSIST COUNTRIES TO COPE WITH TF AGENDA • Compliance with present and future WTO rules • Security vs. Facilitation? Ensuring compliance with new security rules such as WCO safe framework of standard, USA SCI, EU Pre-arrival declaration, Interface with non intrusive inspection devices • On line connection with traders, banks and OGAs • Bringing IT culture to administration and triggering the progress of both public and trade sectors

14. ASYCUDA ASSIST COUNTRIES TO COPE WITH TF AGENDA10 GLOBAL TRENDS Manufactured goods Today 80% of developing countries’ exports are manufactured goods, up from only 20% two decades ago Globalized production Intra-company trade, trade in intermediate products, logistics part of production process Security concerns Security measures along the entire supply chain Trade geography South-South trade has doubled since 1990 Regional integration Increased regional and transit trade Logistics Logistics Inventory holding decreases, and transport expenditure increases Technologies Containerization, shipping networks, computers and Internet Privatizations Ports, shipping lines, railways, airlines, airports Tariff reductions For most developing countries’ exports, international transport costs are 2 to 3 times higher than Customs tariffs on imports in developed countries WTO negotiations “Continuing to make progress…”

15. TF - From early 70’s to 1996… • Work of the UNECE and UNCTAD • UNECE Recommendations • UNCTAD FALPRO • UN International Symposium on Trade Efficiency (UNISTE) in Columbus, Ohio (1994): • Banking & Insurance; • Customs; • Business Information for Trade; • Transport; • Telecommunications.

16. TF - Existing non-compulsory international instruments and best practices “Lack of effective implementation of the instruments” Internationally-accepted customs and practices, negotiated by interested Governments through international organizations and private sector institutions: WCO, ECE, IMO, ICC … However: Lack of effective implementation of the instruments. Non-binding feature of these commitments Internationally-accepted customs and practices, negotiated by interested Governments through international organizations and private sector institutions: WCO, ECE, IMO, ICC-UNCTAD …

17. GATT 1994 (i.e. binding WTO) • Article V Freedom of Transit • Article VIII Fees and Formalities connected with IMP/EXPortation • Article X Publication and Administration of Trade Procedures • Agreement on the Implementation of Article VII (Customs Valuation); • Agreement on Preshipment Inspection; • Agreement on Import Licensing Procedures; • Agreement on Rules of Origin; • Agreement on Technical Barriers to Trade; • Agreement on Sanitary and Phytosanitary Measures.

18. Simplification Harmonisation Standardisation Process of eliminating all unnecessary elements and duplications in formalities, processes and procedures Alignment of national procedures, operations and documents with international conventions, standards and practices. Process of developing internationally agreed formats for practices and procedures, documents and information. ASYCUDA ASSIST COUNTRIES TO COPE WITH TF AGENDA TRADE FACILITATION

19. TF is just a matter of bureaucracy It is really a matter of information processing where documents are information support and formalities and procedures are information processes TF is inexpensive & easy to implement Process reengineering – whether administrative or commercial - is a very complex and resource demanding exercise requiring both change management skills and technological know-how The IT systems are not important Paperless process requires a state-of-the-art IT system featuring in particular: A real added value for the end user A highly customizable and extendable functionality A strong IT security model Potentially Misleading Beliefs ASYCUDA ASSIST COUNTRIES TO COPE WITH TF AGENDA

20. ASYCUDA: ESSENTIAL TO CUSTOMS MODERNIZATION OS UNIX, WINDOWS, OSX Integration ASYCUDA World Training IT Hardware SOCLASS RDBMS Telecom Hw & Sw JAVA Servers, PCs, Printers, UPS etc “ASYCUDAWorld is a powerful e-Government platform”

21. ASYCUDA ASSIST COUNTRIES TO COPE WITH TF AGENDA On line connection and web services with Brokers, Carriers, Banks, Other Government Agencies, etc. e-Exemption Vehicles FDA e-Notify ASYCUDA Licences e-Payment e-Standards “ASYCUDAWorld is a powerful e-Government platform”

22. ASYCUDA ASSIST COUNTRIES TO COPE WITH TF AGENDA UNCTAD MANDATE COUNTRIES FEED BACK ASYCUDA ESW STAKEHOLDER EXPERTISE COUNTRIES FEED BACK INFORMATION TECHNOLOGY COUNTRIES FEED BACK NORMS & STANDARDS COUNTRIES FEED BACK COUNTRIES REQUIREMENTS COUNTRIES FEED BACK COUNTRIES FEED BACK COUNTRIES FEED BACK

23. ASYCUDA ASSIST COUNTRIES TO COPE WITH TF AGENDA ASYCUDA in 5 continentsSource : ASYCUDA World Report

24. THANK YOUFOR YOUR ATTENTION P2P Learning Workshop on ASYCUDAWorld Livingstone, Zambia Fabrice Millet fabrice.millet@unctad.org