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January 25, 2015

Better borders


January 25, 2015


The World Customs organisation, an independent intergovernmental body based in Brussels and representative of 179 customs administrations across the globe which process about 98 percent of the global trade, has dedicated the year 2015 to the promotion of coordinated border management under the slogan of ‘Coordinated Border Management (CBM): an inclusive approach for connecting stakeholders’.
All WCO members, including Pakistan, will celebrate ‘International Customs Day’ on January 26. Interconnectedness and integration are considered the key dynamics influencing economic growth and international trade in today’s globalised world. And coordinated border management is a vital component for boosting trade as better coordination for border management can turn out to be a type of ‘comparative advantage’ for a nation.
One of the biggest non-physical barriers adversely impacting international trade is excessive delays at border crossings. There may be multiple reasons for such delays – like outmoded customs processes, non-tariff barriers, corruption, repeated inspection of goods by different agencies, non-transparent rules and regulations, and poor infrastructure etc – but in most cases such delays are aggravated by the lack of coordination among border agencies. Each of these agencies has a different mandate and objective with regard to goods and people crossing the border and most often they work independently and hardly have an institutional mechanism in place for better coordination and cooperation.
For example, in Pakistan, customs may be interested that the goods crossing the border do not escape duty and taxes and in order to achieve this objective it will be more interested in the truthfulness of description and quantity of goods crossing the border. The Anti-Narcotics Force will be interested that the goods being exported are free of narcotics and for achieving this objective, it may like for each export consignment to be subjected to

100 percent physical inspection and scanning. The Federal Investigation Agency may be more interested in the driver of the vehicle having a valid passport and visa.
Thus interventions by all the agencies, if they lack coordination among them, will result in long delays and attendant costs which will ultimately enhance the cost of doing business. And believe me these costs are not small. In case of perishable goods, the cost incurred for time delays is nearly three percent each day and each extra signature an exporter requires on the export documents reduces trade by 4.2 percent.
In this context, coordinated border management has thus emerged in the last couple of years as a fundamental component of a nation’s modernized customs and border control strategy. It emphasises streamlining parallel processes and technologies enabling different government agencies to effectively work together on border issues. By implementing CBM strategies at both the domestic and international level, nations can reduce internal costs and inefficiencies, improve security, and can increase their ability to increase trade facilitation.
The most important ingredient of border management is that border agencies work in a coordinated manner by sharing information and avoiding duplication of processes and procedures. Delays at borders can be reduced if interventions are based on an integrated risk management framework that addresses the concerns of all the agencies at the border.
This inter-agency ‘behind the border’ coordination is one dimension of coordinated border management. Another important aspect of coordinated border management requires cooperation with neighbouring countries, institution of joint controls at border crossings, or reducing duplication of processes and procedures by sharing information and resources at the least.
Theoretically nobody can dispute the advantages of coordinated border management but the real challenge lies in its implementation, both ‘behind the borders’ and ‘across the borders’. Border agencies in a country mostly work as fiefdoms and do not want to lose their turf. They not only jealously guard their mandate but also try to expand their area of influence. Coordinated border management generally results in redistribution of power of agencies over goods and people and even in some cases loss of power, so those with vested interests will always try to frustrate the efforts at coordinated border management. And if political will and legal/formal basis of inter-agency cooperation are lacking, hardly any tangible results will be forthcoming.
For example, control of smuggling is the domain of Pakistan Customs but due to constraints of resources, the job of anti-smuggling is also delegated to agencies like the Frontier Constabulary, Pakistan Coast Guards, and the Rangers. But hardly any formal mechanism exists for responsibility sharing and performance evaluation of such agencies with regard to anti-smuggling. That is why anti-smuggling is an area which leaves a lot to be desired. Unless the framework and apparatus of anti-smuggling is overhauled, control of smuggling will remain a dream.
The creation of a ‘Border Customs Force’ exclusively dedicated to anti-smuggling is a must to tackle smuggling. Till such a force is created, a formal framework needs to be put in place for inter-agency collaboration. Performance evaluation of the personnel of organisations like FC and Pakistan Rangers who are tasked with anti-smuggling work should be made by the lead agency – customs – to start with. A sound legal basis needs to be put in place to support inter-agency sharing of data and responsibility.
The concept of border management is not relevant only at the national level. Regional and global cooperation in this regard is also required. It is only through collaborative efforts of the customs administrations of various countries that threats to global security and peace are reduced. It will require strengthening of institutional mechanism for exchange of information between the countries. Regional Intelligence Liaison Office (RILO) and Customs Enforcement Network (CEN) are two such initiatives taken under the auspices of the WCO in the past. What we need is to make greater efforts to optimise the benefits arising out of these initiatives. Furthermore, serious efforts are needed to deepen cooperation between the customs administrations of Pakistan, India and Afghanistan.
At the national level, Pakistan Customs has embarked upon certain important initiatives to improve communication with internal and external stakeholders. A web-based customs clearance system, the WeBOC system, has been rolled out at the ports. This initiative has not only helped in developing a central data base of the importers and exporters but has also helped remove distortions emerging from differential application of customs values at different ports. Besides improving customs processes, WeBOC has also been instrumental in reducing the clearance time and consequently the cost of business.
The WeBOC system is based on risk management which rewards integrity and penalizes non-compliance. The Doing Business Report 2015, a flagship publication of the World Bank, has appreciated this web-based system of Pakistan which, according to the report, has made trading across countries easier.
Certain other initiatives like Containers Tracking, Cargo Security Initiative (CSI) and Electronic Data Interchange (EDI) with Afghan Customs are expected not only to improve customs control but also help towards coordinated border management. We should be clear in our minds that in the coming years India and Afghanistan will emerge as our major trading partners.
The writer is a graduate of Columbia University.
Email: [email protected] Twitter: @Jamilnasir1




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