Trade facilitation: Benefits and Capacity Building for Customs

1. Trade facilitation: Benefits and Capacity Building for Customs UNECE International Forum on Trade Facilitation, 14-15 May 2003 Kunio Mikuriya Deputy Secretary General World Customs Organization

2. Structure of presentation • Customs role in achieving benefits for all from trade facilitation • New security initiatives in the context of existing efforts for trade facilitation • A Customs capacity building strategy to promote Customs modernization

3. Doha call for trade facilitation • A progress in the WTO review on the relevant GATT Articles • Political will and commitment • Cooperation from the trade • Realignment of resources to Customs • Modernization and reform of Customs • Coordinated intervention with other border agencies, including “Single Window”

4. Complementary nature between WTO and WCO • WTO rules set out high principles • WCO instruments provide implementation tools for WTO high principles • All WCO instruments are compatible with and complementary to the GATT articles • The revised Kyoto Convention and its guidelines provide the basis and practical guidance and information for the implementation • Offer solutions to meet legitimate goals of revenue collection and social protection, while delivering trade facilitation dividends

5. Core principles of the revised Kyoto Convention • Transparency and predictability • Standardization and simplification • Maximum use of information technology • Minimum necessary control to ensure compliance • Risk management for facilitation and control • Fast track procedures for traders with good compliance record (“authorized traders” concept) • Cooperation and partnership with all stakeholders Also addressing integrity

6. Supporting initiatives • WCO Customs Data Model to establish standard data sets and electronic format • Unique Consignment Reference (UCR) concept with a common reference number for better tracing of the entire logistical chain and facilitation • Memoranda of Understanding (MOU) programme • Time Release Study • Facilitation and effective control

7. WCO instruments enhanced by the WTO work • Draw attention of the international community as available tools for trade facilitation • The revised Kyoto Convention already ratified by the 14 members • The European Council (March 2003) and the US President’s approval (May 2003) upon the completion of administrative procedures • Incorporation of Kyoto principles in the national legislation • Upgrade of Kyoto IT guidelines in March 2003

8. Security initiatives and trade facilitation • A common global concern: multilateral approach in consistency with bilateral and regional approach • WCO Resolution on Security and Trade Facilitation of International Trade Supply Chain (June 2002) • Security and facilitation: two sides of the same coin, efficient and effective Customs procedures • Resolution: risk management, advance electronic transmission of Customs data, cooperation with the private sector etc. measures contained in the existing WCO instruments • Implementation of the revised Kyoto Convention

9. Extended Customs attention to the entire supply chain • Security undertaken as early as possible • Risk management based on information supplied at the early stage • A secure and authorized supply chain • Mutual recognition of authorized traders • Predictability, less opportunity for theft and pilferage and increased opportunities for facilitation of business • Risks associated with all types of security, including economic and revenue security • Integrated with efforts to intercept prohibited goods, such as illicit drugs, counterfeit products, funding sources for organized criminal and terrorist groups

10. WCO Task Force with active participation of trade and transport • Re-examination of the Customs Data Model to ensure it includes the necessary data elements to identify high-risk goods • Development of guidelines for a legal and other procedural basis to enable the advance electronic transmission of Customs data: Customs Guidelines on Advance Cargo Information, a multilateral instrument on Mutual Administrative Assistance and Guidelines for national laws • Development of guidelines for cooperation between Customs and private industry Delivery at the June Council sessions

11. Longer-term aspects of the Resolution • Promotion of the security and facilitation tools • Identification of Customs needs in establishing a supply chain security regime • Identification of potential donors • Development of Customs techniques and implementation of procedures • Development of databank on advanced technology

12. Capacity building • Development of a Customs Capacity Building Strategy • A business case for well designed and targeted capacity building investment on improving efficiency and effectiveness of Customs • A comprehensive and long term approach • Significant dividends for governments, donors and the private sector • Development opportunities provided by the global trading system • Effective revenue mobilization, facilitate trade and investment, good governance, community protection • Failed cases of past capacity building initiatives • “One size fits all” solutions do not work

13. Customs Capacity Building Strategy • The case for comprehensive capacity building in Customs • What capacity building means in the Customs context, by identifying the key principles of the revised Kyoto Convention as basis, including safeguarding integrity • Lessons learned from the previous capacity building initiatives • Capacity building needs and challenges (survey outcome) • Roles and responsibilities of potential stakeholders and partners • A standardized and comprehensive diagnostic tool

14. Strategy’s targeted audience • Response to the Doha Declaration underlining the commitment for capacity building in trade facilitation • Contribution to the Cancun Ministerial in September • Response to the Resolution on supply chain initiatives • Customs administrations and all stakeholders to mobilize all available resources

15. Cooperation among stakeholders • Enhanced partnership with the private sector • Joint and well-coordinated intervention with other border agencies • Better coordination with other international and regional organizations • Avoid unnecessary duplication • For more information: www.wcoomd.org