Moving goods across the borders

With the progress made in liberalizing international trade through the reduction in tariff barriers, the focus is shifting increasingly to the removal of non-tariff barriers and the facilitation of legitimate trade. At the same time, border management is becoming more complex and this is compounded by the multiplicity of state agencies involved in that management.

The World Customs Organization (WCO), the World Bank and other agencies have championed coordinated border management with the aim of reducing the costs of moving goods across borders. From an international coordinated border management perspective, one stop border posts have been introduced or are being considered as a mechanism to improve the movement of goods across shared borders.

These arrangements have both economic and enforcement benefits.

However, they need to be rooted in a sound policy and underpinned by an enabling legal framework and implementation strategy that have the support of all stakeholders.

Globalization and international trade liberalization initiatives have resulted in the rapid growth of the value and volume of goods moving across borders. The conclusion of various rounds of multilateral trade negotiations and the implementation of preferential trade arrangements such as customs unions and free trade areas have resulted in the reduction of tariff barriers. The gains of these initiatives have been immense. However, goods have not only face duties and taxes when they move across borders. They are also subject to other regulatory controls.

These controls are usually undertaken by national customs administrations on a transactional basis. As part of their mandates to control the cross-border movement of goods, national customs administrations also prevent and detect the smuggling of goods and combat commercial fraud where traders attempt to evade or minimize the payment of duties and taxes. Other agencies with either a presence at the frontier or with a responsibility for executing controls over the movement of goods include those with a responsibility for agriculture, food safety, health, immigration, policing and standards. These controls are executed either by the agencies themselves or by other agencies on their behalf, such as Customs.

Compliance with regulatory requirements imposes costs on trading across borders, especially if this results in delays as a result of cumbersome procedures and requirements, corruption and weak administrative capacity. As a result, the attention of policy-makers has in recent years expanded from reducing tariff barriers to reducing non-tariff barriers. The aim of trade facilitation is to stimulate trade through a reduction of costs resulting from compliance costs, procedural delays, a lack of predictability and so on.

Various instruments have been developed aimed at promoting the facilitation of legitimate trade across borders. These include provisions of the WTO Agreement and treaties of the WCO. In this regard, specific reference should be made to the revised Kyoto Convention that ‘… provides both the legal framework and a range of agreed standards to improve customs operations with a view toward standardizing and harmonizing customs policies and procedures worldwide’. The main objective of the Convention is to facilitate legitimate trade by simplifying and harmonizing customs procedures and practices.

The WCO’s SAFE Framework of Standards also aims, amongst others, to facilitate legitimate trade and introduced the concepts of ‘Customs-to-Customs’ and ‘Customs-to-Business’ partnerships.

As a result of these and other instruments, many customs administrations have introduced reforms such as the implementation of risk management to focus attention on high risk traders and goods, automation to enable traders and intermediaries to submit documentation electronically, sometimes in combination with single window systems, accreditation arrangements for trusted traders and other facilitation arrangements. Combined with initiatives to develop more professional, skilled and agile workforces, these developments have impacted positively on trade facilitation.

Date: 2015-12-24; view: 1299