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Supply Chains & Digital Information Current & Future Trends in International Trade

Supply Chains & Digital Information Current & Future Trends in International Trade. Mike Doran UN/CEFACT Plenary Vice-Chair 3rd Executive Forum on Trade Facilitation, Geneva, 20-21 June 2005. Agenda. 1. UN/CEFACT 2. International Trade Transaction Process

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Supply Chains & Digital Information Current & Future Trends in International Trade

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  1. Supply Chains & Digital InformationCurrent & Future Trends inInternational Trade • Mike Doran • UN/CEFACT Plenary Vice-Chair • 3rd Executive Forum on Trade Facilitation, Geneva, 20-21 June 2005

  2. Agenda 1. UN/CEFACT 2. International Trade Transaction Process -International Supply Chain Reference Model - Trade Facilitation & Trade Security - Single Windows 3. From Paper to Digital documents - Document Standards - International Trade - The UNeDocs Project 4. A Roadmap Towards Paperless Trade

  3. UN/CEFACT Mission To deliver trade facilitation recommendations & e-business standards which can improve the ability of business, trade and administrative organizations within developed, developing and transitional economies, to trade products and relevant services more effectively - and so contribute to the growth of global commerce. Focus The worldwide facilitation of national AND international trade transactions, through the simplification and harmonization of business processes, procedures and information flows.

  4. UN/CEFACT Structure VISION STRATEGY TACTICAL

  5. Agenda 1. UN/CEFACT 2. International Trade Transaction Process -International Supply Chain Reference Model - Trade Facilitation & Trade Security - Single Windows 3. From Paper to Digital documents - Document Standards - International Trade - The UNeDocs Project 4. A Roadmap Towards Paperless Trade ?

  6. International Supply Chain Reference Model The Challenge:- To enable trade facilitation & e-business solutions to be developed that meet the needs of the potential45 Partiesinvolved in the execution of National and International TradeTransactionsinvolvingSeveral hundredactivitiesundertaken in some70 relationshipswhilst recognising the variety of technical and business capabilities of the parties and contribute to cost savings of some 3 to 10 % of International Trade.

  7. International Supply Chain Reference Model The Model consists ofText Descriptions of the major trade processes and information Pictorial representationsof the information using Unified Modelling Language(UML)standard AModellinking these representations together A Catalog of common business processes

  8. International Supply Chain - Many Parties Source : Complex Networked Supply Chain (Harwick, 1999 )

  9. International Trade Transaction Process Intermediary BUY SHIP PAY Customer Supplier Authority The International Trade Transaction Process consists of The International Trade Transaction Process consists of integrated and coordinated flows of information, goods & payments Source: The UN/CEFACT International Supply Chain Reference Model

  10. International Trade Transaction Process SHIP PAY BUY Prepare For Export Prepare For Import Export Transport Import INVOLVES • Commercial • Procedures • Establish Contract • Order Goods • Advise On Delivery • Request Payment • Transport • Procedures • Establish Transport Contract • Collect,Transport and Deliver Goods • Provide Waybills, Goods Receipts Status reports etc. • Regulatory • Procudures • Obtain Import/Export Licences etc • Provide Customs Declarations • Provide Cargo Declaration • Apply Trade Security Procedures • Clear Goods for Export/Import • Financial Procedures • Provide Credit Rating • Provide Insurance • Provide Credit • Execute Payment • Issue Statements

  11. Trade Facilitation & Trade SecurityNew processes to ensure the security of international trade • World Customs Organization’s Advanced Cargo Information (ACI) • US Customs 24 Hour Rule • International Maritime Organization’s International Ship & Port Facility Security Code (ISPS) • The European Commission communication on a Simple & Paperless environment for Customs & Trade

  12. Sub Processes of the Ship Use Case

  13. Single Windows

  14. Meeting regulatory requirements and exchanging information with government

  15. A Single Window The new approach - a simple, one-stop solution offering official control with trade facilitation.

  16. Business Model of the MauritiusSingle Window • Joint venture functioning 100% as a private concern • Equity (± USD 1 million) provided by shareholders • Self-sustainability perspective right from the start • Activities financed from 2 sources: • a software single-user licence of $ 1300 • a service fee of USD 5.- per declaration • Highly successful and profitable activity: • share value multiplied by eight since 1994 • yearly dividends = ± 90% of funds invested

  17. UN/CEFACT Recommendation Number 33 Recommendation & Guidelines on EstablishingaSingle Window To enhance the efficient exchange of information between trade and government http://www.unece.org/cefact/recommendations/rec33/rec33_ecetrd352_e.pdf

  18. SINGLE WINDOWSNext Steps Developing aStandardfor theEstablishmentofSingle Windows Developing Commonly Agreed Data Structures for Single Windows Benefits have to be higher than implementation costs

  19. Agenda 1. UN/CEFACT 2. International Trade Transaction Process -International Supply Chain Reference Model - Trade Facilitation & Trade Security - Single Windows 3. From Paper to Digital documents - Document Standards - International Trade - The UNeDocs Project 4. A Roadmap Towards Paperless Trade

  20. International Trade & Digital Information • Exchange of information - covers the entire trade transaction process • Trade documents are the core means of exchanging information • Goods cannot move faster than the information that controls them • There are increasing requirements for just-in-time delivery, approved supply chains etc • Added impact of security measures on information requirements (ACI, 24 hour rule etc)

  21. Paper Document StandardsThe United Nations Layout Key • First started in the 1950s • During 60s & 70s the UN Layout Key (UNLK) was in use in many countries worldwide through the work of UNECE & UNCTAD • In 1978 the UNLK Recommendation had gained world-wide acceptance and was re-named, the: • United Nations Layout Key for Trade Documents • (Recommendation No 1 - ISO 6422)

  22. UNLK Set of standards Borders Boxes Data Elements and Boxes

  23. Market Requirements for International Traders The ability to allow traders to move from a form to an electronic message AND BACK AGAIN at any point in the trade transaction

  24. eDocument DevelopmentsElecTra - SITPRO (UK) Form UN/EDIFACT EDI Equivalent

  25. Digital Document StandardsThe UNeDocs Project Developing the initial work of SITPRO for international trade. Based on the following standards: UN Layout Key for Trade Documents (UNECE Recommendation 1/ISO6422) United Nations Trade Data Elements Directory (UNTDED/ISO7372) UN/CEFACT ebXML Core Components (ISO 15000 Part 5) UN/EDIFACT - for EDI applications UN/CEFACT XML Naming & Design Rules UN/ECE Trade Facilitation Recommendations

  26. UNeDocs Deliverables • A Digital Document Standard for international trade documents • Business Process model derived from the UN/CEFACT International Supply Chain Reference Model • ebXML UN/CEFACT Core Component-based Data Model from which the set of UNeDocs documents are derived which…

  27. … comply with the UN Layout Key standard …

  28. …and are delivered with box completion guidelines, …

  29. Plus UN/CEFACT XML schemas and…

  30. …and UN/EDIFACT message implementation guides

  31. UNeDocs Project - Current Status • Project transferred to the UN/CEFACT Forum TBG 2 - Digital Paper Working Group • A Call for Participation in this WG launched in document TRADE/CEFACT/2005/27 • Feasability study carried out with OASIS - UBL TC for UBL 2.0 with UNeDocs alignment • A Stakeholder Group will now be set up to formulate the needs & documentary requirements of stakeholders and provide support for the development & implementation of digital document standards

  32. Agenda 1. UN/CEFACT 2. International Trade Transaction Process -International Supply Chain Reference Model - Trade Facilitation & Trade Security - Single Windows 3. From Paper to Digital documents - Document Standards - International Trade - The UNeDocs Project 4. A Roadmap Towards Paperless Trade

  33. “A Roadmap towards Paperless Trade” • TheExecutive Forum is invited to: • Review the draft Roadmap • Assess the current state of implementation • Take stock of experience & lessons learned, to: • Identify steps that governments & business need to take to change to paperless

  34. What is a Roadmap? Itis a tool to facilitate the passage from the current situation to a future commonly agreed objective, the implementation of paperless trade.

  35. What are the issues? • Benefits: who benefits & how? • Costs: what are the costs & who will pay? • Policy & Strategy considerations • - Time frame & process • - Role of governments • - Scope of Paperless Trade • - Trade Facilitation & Open Standards

  36. What are the next steps for the Roadmap? • TheRoadmap is not a negotiated text. It is a living document to establish a framework, based on agreed objectives, which: • Includes the input of previous Workshops • Will include comments & recommendations from the Executive Forum on Paperless Trade • Will provide an initial “simple tool” for the implementation of paperless trade • Could provide thematic input into the World Summit on the Information Society (WSIS), Tunis - Nov ‘05

  37. Development of the Roadmap The Roadmap will be further developed during the course of the Executive Forum & will be reviewed in the closing Round Table: “Creating an enabling Environment to make Paperless Trade a Reality” ..and will then be forwarded to UN/CEFACT for consolidation & circulation.

  38. Next UN/CEFACT Forum Meetings - 7th UN/CEFACT Forum Lyon, France - 26 to 30 September 2005 - 8th UN/CEFACT Forum Vancouver, Canada - March 2006 - 9th UN/CEFACT Forum New Delhi, India - September 2006

  39. Mike.Doran@cern.ch For further information see: http://www.uncefact.org

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