Single Stop Inspection Cooperation in the Greater Mekong

Single Stop Inspection Cooperation in the Greater Mekong Subregion Assoc. Prof. Ruth Banomyong (Ph. D) Director, Centre for Logistics Research ruth@banomyong. com

Agenda • Introduction to the GMS • GMS Trade facilitation initiatives – SFA-TFI – CBTA • Single Stop Inspection • Single Window Inspection • Some Observations…

Trade Facilitation in GMS • Defined: trade, customs and transport facilitation, to support accession and implementation of the international/regional agreements and commitments • Focus of work: physical connectivity; legal agreement (CBTA); framework for action on trade facilitation • Institutional mechanisms: trade facilitation working group meetings; committees under CBTA; GMS Customs directors-generals meetings

SFA-TFI Initiative • SFA-TFI re-enforces FTAs, WTO agreements, Revised Kyoto Convention, ASEAN Transit Agreement and CBTA • SFA-TFI deals with behind the border constraints in: – Information sharing and exchange regarding cargo clearance, – Customs procedures harmonisation, – Sanitary and phyto-sanitary cooperation, – Trade logistics development, and; – Business visa for business people • All of these are national issues and require regional level of cooperation

SFA-TFI Customs Gaps Ø Ø Reforms: customs reforms are ongoing but at different stages of implementation (the Revised Kyoto Convention) Differences in inspection regime (slow to adopt modern risk management techniques), transparency, automation and uneven use of electronic data interchange, clearance time Customs-centered reforms, lack of support for other government agencies involved in cargo clearance Land border systems underdeveloped, focus has been on ports and airports

SPS Inspection and Quarantine Gaps Ø Uneven regulatory and legal framework Ø Slow and inadequate collection and distribution of information on threats and responses Ø Lack of certified testing and quarantine facilities Ø Use of standards as non tariff barriers (NTBs) Ø Lack of risk management in SPS agencies

Logistics Gaps Analysis Ø Lack of connectivity and capacity of infrastructure Ø Continue inefficient public sector operations Ø Simple, un-integrated logistics services Ø Limited demand for more sophisticated services

The GMS-CBTA Initiative • Inconsistent and difficult border crossing formalities and procedures • Restrictive visa requirements • Restrictions on entry of motor vehicles • Different standards on vehicles and drivers across countries • Transit traffic difficult/not allowed

CBTA Features • Multilateral agreement that covers all aspects of cross border movement of goods, vehicles and people • Makes reference and in conformity with international conventions: Conventions on Road traffic; Road Signs and Signals, TIR; Temporary Importation of Commercial Road Vehicles; Containers; Harmonization of Frontier Control of Goods • Comprises of one framework agreements+20 annexes and protocols

CBTA Focus • Facilitation of border crossing formalities (single window and single stop customs inspection, coordinating of hours of operation; and exchange of advance information and clearance) • Facilitate cross-border movement of people (multi-entry visa, recognition of driver license) • Facilitate cross-border movement of goods (regional transit regime) • Exchange of traffic rights • Requirements for admittance of road vehicles • Institutional Arrangements

National ADB RETA Support Subregional Ministerial Joint Committee Cambodia NTFC PRC NTFC Lao PDR NTTFC subcommittees Myanmar NTFC Thailand NTFC Transport Customs Immigration Quarantine Viet Nam NTFC CBTA Institutional Mechanism 12

CBTA- Chronology • • • 1998: preparation of Framework Agreement 1998 -2003: negotiation and signing of Framework Agreement 1999– 2006: preparation and negotiation of Annexes and Protocols March 2007: 2 nd Joint Committee Meeting, signing of remaining annexes and protocol 2005 -2008: initial implementation of CBTA at selected border crossing points 2009 onwards: full implementation

POTENTIAL NEW BORDER CROSSING POINTS BY 2009 FULL IMPLEMENTATION YOUYIGUAN (PRC) - HUU NGHI (VIE) SECOND PHASE (commencing in 2007) THAKHEK FIRST PHASE(LAO) – HA TINH (VIE) (commencing in 2005/06) THIRD PHASE (commencing in 2008/2009) LORK (CAM) – XA XIA (VIE)

SINGLE STOP INSPECTION • Single stop inspection is included in the GMS CBTA (Article 4, Annex IV. ) • The objective is to reduce duplicate inspections by countries sharing a land border • Single stop inspections are carried out by both customs services at the border on a site that is located in the territory of either country, or straddling the border 15

SSI CONCEPT • Border processing and inspection is carried out once at the border for imported and exported goods and vehicles. • Commercial vehicles, drivers and crew undergo export and import processing at the same time, jointly and simultaneously by inspection agencies from both countries. • Vehicles only stop once at the border 16

OPTIONS FOR SSI Two basic methods of Customs control under SSI : 1. “Delegated authority/mutual recognition” Customs of one country delegates inspection authority to the Customs of another jurisdiction. 2. “Joint Customs control/operating in foreign territory” Customs of both jurisdictions carry out joint, simultaneous/ or near simultaneous inspection in the other’s territory. 17

SINGLE WINDOW INSPECTION What is SWI? • The Single Window approach to border clearance aims to speed up and simplify information flows between trade and government to reduce delays and complexity in cross border trade. • A single window is a system that allows traders to lodge information with a single body to fulfill all import -or-export related regulatory requirements. • In practical terms, Single Window provides one “entrance” either physical or manual for the submission and handling of all data and documents 18 and inspections related to the clearance of goods.

SINGLE WINDOW INSPECTION (cont. ) • SWI means streamlining, simplifying and elimination of duplicate information requirements of various government agencies. This reduces time, cost and administrative burden to clear goods. • The information requirements of all relevant government agencies can be met efficiently and effectively. Trade is facilitated. • In an automated environment, data is submitted on a single administrative document (electronic) to 19 government through one agency.

SINGLE WINDOW INSPECTION (cont. ) • That Agency (generally Customs) electronically passes the information on to other competent agencies for their action. • All government requirements are met through this single document. • Some control and inspection responsibilities may be delegated to Customs. 20

Key Challenges in CBTA Implementation • National laws and regulations need to be revised • Institutions need to be established, broadened, and strengthened • Capacity needed at national and border levels • Modern border infrastructure and equipment required • Goodwill and trust among Mekong countries is key 21

GMS Outputs: CONNECTIVITY Facilitating subregional trade and investment 1992 2006 2015 Roads Telecommunications Power Transmission Line 22 22

Observation: Lessons from the GMS • Physical infrastructure - necessary but not sufficient • Adopt a holistic approach • Ownership and strong political willingredients to success • National and sub-regional priorities need to be aligned 23

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