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Two Customs Projects

Two Customs Projects. Map of Russia. Russia (SCC- effective). Loan Amount: $140.0 million Project Amount: $187.2 million Terms: 17-years, with 5-year grace period Responsible Agency: RF State Customs Committee Expected Closing Date: 30 June 2009. Afghanistan (ACD - preparation).

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Two Customs Projects

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  1. Two Customs Projects

  2. Map of Russia

  3. Russia (SCC- effective) Loan Amount: $140.0 million Project Amount: $187.2 million Terms: 17-years, with 5-year grace period Responsible Agency: RF State Customs Committee Expected Closing Date: 30 June 2009

  4. Afghanistan (ACD - preparation) Emergency Customs Modernization and Trade Facilitation Project Amount: $30 million Duration: 39 months Implementation: UN Office for Project Services (UNOPS) In addition to 7 different donors

  5. Russia Accede to the WTO Promote best practice Improve compliance Integrity Risk management Afghanistan Post conflict recovery Secure revenue Improve compliance Integrity Re-establish transit …and security Objectives

  6. Russian indicators

  7. Afghan Indicators

  8. Two different contexts with project similitude • Approach • Organization • Design

  9. Lessons learned from past experience Focus on objective rather than institution Involve closely the private sector Targets and performance indicators Clear strategic approach Minimal pre-requirements

  10. Components Customs control and clearance Trade facilitation Fiscal policy Legal framework Organizational structure and operational mngt Financial management HR management Integrity IT Project management Investment 4.02 9.59 4.05 5.04 10.23 6.48 7.27 2.49 133.23 3 Project - Russia

  11. Integrity • Customs inevitably are blamed for whatever goes wrong at the border • Customs are more vulnerable to corruption than other comparable agencies because they have immediate discrete control over tangible wealth

  12. Motive Elite ethos and esprit de corps Positive career development High skill oriented training Incentives for high performance Stronger supervision and controls Sanctions for corruption Stakeholder surveys Opportunity Valuation procedures Automation Inspection based on risk analysis Reduction in discretionary authority Transparent clearance requirements Rotation of officers Functional organization Internal anti-corruption strategy Audit unit Stakeholder surveys Russia – Strategy to promote integrity

  13. Russia - Risk Management • Selectivity is at times misunderstood • “Greenn” can mean “Red” • Negative selectivity: “White lists” • Risk management is at the core of the project • Automation but not yet artificial intelligence • Feedback • It expands beyond cargo processing • Fully integrated in SCC management approach • Drives the business process and administration

  14. NEEDED: Commitment Understanding IT supports, not an end Job process re-assessment Social pact Performance measurement Pilot sites Regional? RUSSIA: Prepared Risk management IT system upgradeable Mapping Specificity factored Indicators Corridors EVRAZES support What is important

  15. How does this apply to Afghanistan? Use Persuasion rather than Imposition • Respecting the Afghan Social Pacts • International performance standards may not be directly applicable without heeding the Afghan cultural context • Political and “informal” commercial realities cannot be ignored

  16. Afghanistan - Building on efforts to-date • New WB-supported staff policy • New Customs declaration (ACCD) implemented in Kabul • Changing role of Chambers of Commerce—valuation at Kabul now done by Customs • Decree for new tariff regime with rationalized exchange rate awaiting decree • Key Afghan Customs Managers being recruited • Provincial/Regional customs consultants in-place in Herat and Mazar • Overall decision to roll-out reforms to provinces/regions

  17. Like everywhere, problems remain in Afghanistan • Valuable but scattered assistance/inputs • Limited ACD recipient capacity (has been slow in emerging)--in HQ, DG, Directors; in regions, Directors, operations staff; under-resourced HQ administration (human, equipment, communications, environment) • Missing link between budget and policy—direct funding of TA by donors a problem • The strategic role of Afghan Customs still to be defined—both in terms of revenue and public administration and socio-economic (i.e., protecting society and promoting trade) • Under-developed synergies with Commerce, Transport, and Police (Interior)

  18. Redefining the role of Afghan Customs which… • Secure revenue • Help protect society • Facilitate trade and thus economic development and job creation Hopefully, this will generate (i) interest, (ii) motivation, (iii) recognition, and even (iv) enthusiasm…

  19. Reforming the Customs and Trade Regime—To build upon the good work to-date, we need…. • Clear definition of, and an agreement on, the role of Customs in the development of Afghanistan • Empowered and supported Afghan leadership in Customs • Better Donor Coordination • Enhanced Communication and Trust between all stakeholders and change process enablers (MoCommerce, MoInterior, MoTransport, MoF/ACD) • Well targeted, coordinated, and enhanced resources

  20. The donors • DFID – HR, training, management advice, change management process • USAID – Implementation and Operations (Valuation and classification,Procedures and documentation, Customs code, Customs brokers) and Enforcement (Border control and management, Drugs/smuggling, Corruption) • EC – Transit development and facilities (preferably at borders) • And the Bank

  21. The World Bank • Customs • Policy and overall strategic framework • Performance based Budget management • Customs automation (ASYCUDA) • Implementation advisors (officers from various customs services to work with Afghan line-staff) • ACD HQ restructuring implementation and roll-out to regions • Infrastructure (preferably regional ICDs, HQ, and Regions) • Information and communications infrastructure • Incremental operating costs for the overall program

  22. The World Bank (continued) • Trade Facilitation • Policy and overall strategic framework for restructuring • Alignment of national trade documents (ASYCUDA related first) • Transit treaties (bringing reality into “political” agreements+corridor agreements) • Bureau of Standards (through UNIDO) • Measurement of trade and transport logistics costs and time • Incremental operating costs and some infrastructure and information and communications support to the above • WTO accession assistance through UNCTAD • Review role of state-owned enterprises

  23. Some directions • Why ASYCUDA? • What about infrastructure? • Staffing / redundancies • Legislation

  24. The legislative critical path

  25. A cautious approach • There is control, but it does not look like what we are used to • Reporting mechanisms are different, but solid • Even without bank guarantees, trucks arrive at destination • Communication does not follow our standards

  26. Russia: Voluntarist, necessary steps taken, skills exist, private sector is on board, but hoist Customs to Western level A case of transition Afghanistan: Coordinate, build on social factors, use society’s mechanisms, create incentives and build an image A regional integration The chances of success

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