Facilitating SME participation in international trade APEC Customs

Facilitating SME participation in international trade APEC Customs Business Dialogue Ho Chi Minh, Vietnam. 22 August 2017

Contents About Us Trade in Global Value Chains Recommendations Industry Consultations Conclusion 2

Conference of Asia Pacific Express Carriers Representing the Express Delivery Services industry in Asia Pacific since 1996 Works closely with governments/authorities to: ◦ Create a conducive business and regulatory environment for express delivery services; and ◦ Facilitate trade expansion and economic growth in the region 3

The Express Delivery Services Industry Essential for international trade 30 million shipments daily 220 countries and territories 1, 700 aircrafts 200, 000 trucks and delivery vehicles 4

Our Business: High-Value, Time. Guaranteed Cargo Source: Oxford Economics estimates 5

Express Delivery Services Supply Chain Pick-up Local Station Gatewa y Export Hub Gatewa y Import Local Station Delivery Packages pass through a secure supply chain, and can be delivered the next day 6

SMEs and international trade • International trade is increasingly structured around global value chains (GVCs) - thanks to technology, lower transport costs, trade policy reforms… • GVCs open new opportunities for SMEs to internationalise – both in trade and services • Efficient logistics services and supportive business climate key for SME internationalisation • Global e-Commerce market may reach USD 1. 4 trillion by 2015 • Particular benefits for SMEs and has enhanced SME participation in international trade (reaching more markets)

Trade facilitation Facilitating trade has largest benefits for SMEs More to lose than to gain in restricting imports • Import openness determines export competitiveness Efficient border procedures critical for e-Commerce • E-Commerce shipments typically ship small consignments frequently Trade costs impact SME competitiveness Examples of burdensome border procedures • Inventory and administrative costs • Time to reach market critical for competitiveness • Consumers require fast and certain delivery times as well as easy return procedures • One extra day in transit equals price increase by 0. 9% • SMEs more vulnerable to trade costs • Border procedures and administrative requirements, e. g. licensing, add to costs • Lack of automation, including for paying import duties and taxes • Poor coordination between border agencies • High inspection rates, even on low-value shipments

Recommendations: Facilitative Customs procedures § § § Simplification: § Importer and exporter registration § De minimis and low-value shipments § Risk management § Transparency and certainty Harmonisation: § Reduces trade costs § Revised Kyoto Convention and WCO Immediate Release Guidelines Automation: § Promotes good governance and efficiency § Allows for better risk profiling – important with growing trade 9

WTO Trade Facilitation Agreement: A Wish List § Publication of Information (Article 1. 1) § Prior Publication and Consultation (Article 2) § Discipline on Fees and Charges (Article 6) § Pre-arrival Processing (Article 7. 1) § Electronic Payment (Article 7. 2) § Separation of Release from Duties (Article 7. 3) § Risk Management (Article 7. 4) § Post-clearance Audit (Article 7. 5) § Expedited Shipments (Article 7. 8) § Formalities and Documents (Article 10. 1) § Acceptance of Copies (Article 10. 2) § Common procedures and uniformity (Article 1. 7) 10

Collaboration Simplification and harmonisation of customs requirements key for SME trade Coordination between government agencies key for efficient implementation Prior consultation for new or amended rules and regulations is critical Prior consultation ensures rules and regulations promote trade and support industry growth, not restrict CAPEC works with Customs authorities and governments throughout Asia 11

Conclusion • Global Value Chains and e-Commerce present large opportunities for SME growth • An open FDI regime for services supports efficient logistics and SME participation in international trade • Risk management procedures and higher de minimis have benefits, particularly for SMEs • Open communication and industry consultation are critical to minimizing adverse impact on legitimate trade • CAPEC is committed to continued partnership with Customs administrations

Customs Control Collection Security Logistics Industry Thank You Simplified Procedures Automated Systems Businesses More Competitive Lower Costs Working Together = Everybody Wins 13

CONTACT Conference of Asia Pacific Express Carriers 24 a Ann Siang Road Singapore 069704 Telephone : (65) 6904 4234 www. capec. org 14