corridor/border management: examples from outside the caucasus gerald ollivier transport specialist
TRANSCRIPT
Corridor/Border Management: examples from outside the Caucasus
Gerald Ollivier
Transport Specialist
Overview
Time as a trade barrier
Corridor Approach
Integrated Border Management and Single Electronic Window
Developing countries are moving up the technology ladder…(GEP 2004)
0
10
20
30
40
50
60
70
80
90
100
Resource-based
Low tech MediumTech
High tech
1981
2001
Low income countries: Share of exports, 1981-2001 (percent)
0102030405060708090
Resource-based Low tech Medium Tech High tech
1981
2001
Middle income countries: Share of exports, 1981-2001 (percent)
Time is a Trade Barrier (1)Trade occurs in physical space and moving goods requires time.Trade logistics costs are as important as tariffs Each day saved is equivalent to 0.5% tariff (Hummels) 7% of value of world trade is cost of administration of trade
logistics (UNCTAD)
Time/reliability/adaptability more important in multi-stage production (global supply chain) % of vertical specialization in trade (use of imported inputs
for exports) has grown 30% in the past 20 yrs and accts for half of overall trade growth.
Willingness to pay to save time: Share of airfreight in US grew from 7% in 65 to 30% in 98 Airfreight 7 times as expensive as ocean shipping.
Time is a Trade Barrier (2)
Imagine if the contents of a ship can be processed in half a day instead of a day …or a truck can do 6 roundtrips instead of 2 a month Infrastructure capacity increased Twice the cargo, twice the # of ships serviced,
twice the number of containers, increased harbor fees, considerably lower cost to traders
…even more benefits: These efficiencies offer wider attraction to trading
partners Efficiency in vessel turnaround attracts new trading,
market center, distribution business.
Time is a Trade Barrier (3)
A wide-body jet can carry fresh produce from supplier in one hemisphere to the buyer in the other hemisphere on the same or next day.BUT it can take 10 days to : Process orders Obtain customs and border agency approvals Book and schedule transport and distribution Obtain payment approvals Complete the transaction
This means removing 10 days from the selling season, revenue that cannot be replaced
CorridorsDefinition
A linear system of transport infrastructure and related services connecting centers of economic activity and bounded by transport gateways which provide access to sources and destinations outside the corridor
ConstructionCorridors are usually created through back-to-back bilateral agreements which are framed for international or regional protocols
ManagementCorridors are not managed in an operational sense as most of the activities are performed by individual logistics service providers operating in the private sector. The important management function is coordination of policies between adjoining countries
ExamplesWest BengalGMSMaputoTranskalihariNorth BorneoNorthern CorridorEWECAsian HighwayCan-Mex
Corridor ComponentsPhysical Gateways and Border Crossings Designated Routes, Single and Multimodal
Regulatory Trade and Transit Policy Cargo Inspection and documentation Security, Entry and Enroute Transport Services and Equipment Cargo Ownership Liability and Arbitration Rules Duties and Taxes Cost Recovery Mechanism
Functions
Access to Landlocked Countries
Integrate Trading Communities
Economic Development Corridors
Coordinate Infrastructure Development
Control Smuggling
Corridor Economic Benefits
Domestic Transport Services
Complementary Logistics Services
Toll Revenues/user charges
Trade Facilitation
Regional Economic Development
Inhibitors to Trade FacilitationTraditional PracticesLack of TransparencyTechnical ControlsRegulationsPaper DocumentsPayment MethodsICT and E-Commerce Infrastructure and Experience
Physical Space and Capital
Costs of Admin/logistics 14%
Customs-Centric Systems but other agencies
Customs only 15% of Trade Data
Post 911
Cultural Issues
Integrated Border Management
Enhancing services to usersWTO TF discussionGeneva/Kyoto ConventionsOrganizing processing by function (an agency can apply regulations for another one at low cost)Coordination across border (joint crossing points)
W h a t a b o rd e r c ro s s in g ca n lo o k lik e
P ol ic e C u s to m s P oli c e C u s to m s
C o u n t r y A C o u n tr y B
S e co n d a r y Po li c e C u s to m s P oli c e C u s to m s
Se c o n da r y
S e c o n d a ry
Se c o n da r yPo lic e C u s t o m s Po li ce C u s to m s
Po li c e C u s to m s Po li ce C u s to m s
J o in t c o ac h e xa m in a t io n
A d m i n s tr a t iv e A A d m in is tr at iv e B
J o i n t co a c h e x a m i n a t i on
Se c on d a ry e x am div er sio n
A c t ua l b o rde r lin e
Ca rs ( re d a nd
g re en c h a n ne ls)
Ex it c o u nt ry c o nt ro l bo t hs
T ru cks
G re en ch a n ne l e x it
Tr uc k pa rkin g lo t
Co u n try A 's e n c la v e in th e te r r it or y of C ou n try B
(b or de r lin e)
S e pa ra t or
S ep a ra to r
Se c on d a ry e x am d iv e rs io n
T ru ck pa rkin g lo t
Co u n try A 's e n c la v e in th e t er r it or y of C ou n try B
(b or de r lin e)
T ruc k pa rkin g lo t
Se p ar at or
T ru c k p a rkin g lo t
Gre e n c ha n n el e x it
T ruc ks
Source: M. Zarnowiecki
Principles of Electronic Trade Facilitation Electronics Replaces
Paper Reengineer
Processes: Codes and Standards
Upgrade Customs ICT Systems and Processes
Transparency Electronic Payment
Pre and Post Event Audits
Container Scanning Straight-Through
Processing Risk Management Create Facilitation
Agency Provide a Gateway to
Customs Systems Automate Communities
“Single Window”A facility providing standardized information and documents with a single body to fulfill requirements for import, export and transit regulations and clearance.
Expedite and simplify information flows between trading community and the government
SEW Success Factors
High political mandate (Tunisia)First detailed analysis, followed by process and documentary reengineering/streamlining with all key players (border agencies, transport, traders…)Baseline indicators and performance measurementNeeded minimum infrastructureFacilitating exchange of information: Common and intelligent network, international standards,regulatory framework for e-signature
Models of “Single Window”Single Authority Sweden, Sokhna for its clients
Single automated system for the collection and dissemination of information Integrated system: data is processed through the
system (USA) Interfaced system: data is sent to the agency for
processing (Tunisia, but elements of transactions) Combination of the above
Automated information transactions system Singapore, Mauritius
ICT reduces Time and Increases Efficiency - Examples
Mauritius Trade Net has reduced average clearance times of goods from 4 hours to 15 minutes
Tunisie Trade Net (TTN) has reduced processing times of trade documents from max of 18 to 7 (3.5 days in cases not requiring technical controls).
Time savings in Singapore (STN) translate into 1% of GDP per year.
Implementation ApproachPhased Approach Complexity Quick wins to secure confidence
International Standards (UN EDIFACT, WCO Data Model, etc.) International information exchange requires standards
Pilot users Surveys / evaluation / fine –tune
Implementing body
IssuesTrade Processes - Chain effect As good as weakest link in the chain Benefits only visible when everything works
Complex Many details that must fit together
Resistance to change Organizational Shift from paper to electronic processes
Prepare to manage project risks-Multiple activities / issues to addressInter-institutional dependencies
Players in the Trade Value Chain Importer/Exporter Trade Professionals
Customs Broker Freight Forwarder Shipping Agent
Container Terminal Ports and Harbours Storage Transport Shippers
Customs Revenue Technical Controls
PIAs Cert. of Origin PSI “Legal Invoices”
Banks Insurers etc.
•Manifest•Bills of Lading•Sea/AW Bill•Container Plans
•Invoice•Packing List•Declaration•Delivery Note
Storage
Air, Sea, LandInternational
TransportCustoms Port
Pay TaxesClear CustomsRelease Goods
Ship’sDocuments
•CertificatesOf Origin
•Licenses•Certificates•Government Approvals
Chamber ofCommerce
ForeignChambersCommerce
OverseasEmbassies
Post/Courier
•“LegalInvoices”
DOMESTICSUPPLY CHAIN
Raw MaterialsPackagingTransportStorage
•Quotations•P.O.s•Delivery Notes•Con. Notes•Invoices•Statements
•Payments•Remittance Advice
IMPORTER
MANUFACTURER
EXPORTERFOREIGNBUYER
IMPORT
•Licenses•Certificates•Government Approvals
•Certificates Of Origin•Form A•EUR.1
GovernmentDepartments
FinanceMinistry
Port
•Invoice•Packing List•Declaration•Delivery Note
Customs
“InformalProcesses”
Pay TaxesClear CustomsRelease to Port
InformalProcesses
Port Processes•Internal Transport•Storage•Container Handling•Loading
Port Customs
MANUFACTURING/ VALUE ADDED EXPORT
ReceiveGoods
Bank
•P.O.•Contract Terms•Delivery Instructions•L.O.C.
PayBank
L.O.C.Packing ListInvoice LOC Courier
LOC Approval
ShippingDocuments
Book/Confirm Transport
/Dues
/Dues
Processing of TCE
2 - 3 D
1 D
0 Goods Arrival
Validation, Amendments, Data Capture of Manifest
2 D
Deliver Manifest hardcopy to Customs and STAM
1/4 D
Goods discharged from vessel
STAM submits hardcopy report of unloaded cargo discrepancies to ship agent
2 - 4D
Shiping Agent reconciles discrepancies regarding cargo unloaded
2 - 5 D
1/2 D 1 -2 D
Shipping Agent delivers final manifest to Customs and STAM
Importer / Broker prepares customs declaration.and delivers to Customs
2 - 3 D Importer / Broker picks up processed declaration.
1 D
Payment of customs duty, storage charges and port dues
0 - 2 D
Confirmation of goods landed byShipping Agent and issue of delivery note
Goods removed from port area
1/4 D 15 mins
Prior to Trade Facilitation Initiative
1 2 3 15 10 5
After Trade Facilitation Initiative
Days
Figure C
Trade Facilitation Network
1
Customs
Customs Brokers
CargoHandling
Port Authority
Traders
Ministry ofCommerce
Freight Forwarders
Shipping Agents
Banks
EDI Server
Figure B
CustomsCustoms
Customs Brokers
CargoHandling
Port Authority
Traders
Ministry ofCommerce
Freight Forwarders
Shipping Agents
Banks
EDI Server
Figure B
Port Computerized Systems: Some examples
• Spain Portal Servicios Telemàticos• UK CNS Port Community Systems and Martime Cargo Processing• Germany DAK OSYS• Belgium DEAGHA• Netherlands PCR• France ADEMAR 2000/PORTIS 2001• Singapore PORTNET• Finland PORTNET
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