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Paperless system speeds up trade

20 February 2014

In this digital age, APEC is centralizing the export-import process using a paperless system, significantly reducing the cost and time for goods to travel across borders. 

Through web-based TradeNet, importers in Singapore electronically submit one form that is automatically linked with all the relevant government agencies managing import permits, certificates and fees. This information is then shared with other parties involved such as banks, insurance companies or immigration agencies.

Known widely as Single Window, this virtual system allows companies to submit documents one time from anywhere. Gone are the myriad of forms, long queues, and visits to multiple agencies, while goods spoiled in warehouses.

APEC Single Window born in 2007

The idea of an APEC Single Window was born in 2007 to enable governments to electronically process information, documents and fees both faster and more accurately. Consumers and companies subsequently benefit from faster clearance and release times, speeding up the supply chain and facilitating trade.

“When APEC's Sub-Committee on Customs Procedures (SCCP) adopted the vision for Single Window in 2007, it identified two key stages,” said Hu Lan, Chair of the APEC Sub-Committee on Customs and Procedures, who are meeting this week in Ningbo, China. 

“The first one was to achieve Single Window systems within each APEC member economy and the second one was to promote international interoperability between Single Window systems and paperless trading between these systems within APEC,” explained Ms Hu.

For several years, the SCCP's Single Window Working Group, chaired by Australia, advanced the Single Window vision within APEC. This was helped by capacity-building workshops to bring economies up to speed on implementing their own Single Window systems. The workshops provided training from software coding to legal and regulatory best practices.

“In March 2011, APEC adopted a new Collective Action Plan for the Development of Single Window systems and promotion of international interoperability,” said Toshihito Tomiyama, Deputy Director of International Affairs for Japan’s Customs and Tariff Bureau and project overseer of APEC Single Window capacity building projects.

“The goal is to develop Single Window systems within each APEC member economy by 2020,” he added.

By 2012, fourteen APEC economies had adopted various stages of the Single Window system

Indonesia was one of the economies that benefited from the APEC capacity building and training projects.

Yan Inderayana, Head of Administration System Automation in Indonesia’s Directorate General of Customs and Excise and a member of the Indonesian Single Window preparation team, said his economy has implemented the Single Window system in five major ports.

“The Indonesian Single Window system includes 18 Government agencies for import licenses and all government agencies related to export licenses. The use of the Single Window system is now mandatory for import and export systems at the above five ports,” he explained.

Peru also launched its Single Window for Foreign Trade (VUCE) in 2010, electronically streamlining permits, certificates, and licenses across multiple agencies for entry and exit of goods.

“In 2013, we launched two new components: origin component and port component,” said Francisco Ruiz Zamudio, Chief of the Trade Facilitation Division at the Ministry of Foreign Trade and Tourism, and President of the Single Window Implementation Committee in Peru.

“The first one allows users to simplify administrative procedures related to eligibility and issuance of certificates of origin, which can be used by producers and exporters. The port component, on the other hand, includes all the formalities required for the arrival, stay and clearance of ships. These activities are all now electronically processed.”

Already the economic benefits of Single Window in the APEC region are starting to be seen

According to the World Bank report Doing Business 2012: Trading across Borders, the Korea Customs Service estimates that the introduction of its Single Window system brought some USD 18 million in benefits in 2010.

“The Single Window system was first introduced in Japan in 2003 with all stages fully implemented by 2010,” said Mr Tomiyama. “This has improved air cargo import processing times by about half from 25.7 hours in 2001 to only 13.4 hours in 2012.”

The results of this reduced cargo processing time has brought benefits to the private sector.

Asa Larsson, Deutsche Post DHL’s Senior Director of Corporate Public Policy for Southeast Asia, said: “We commend the actions…of APEC economies to implement Single Windows in order to improve inter-agency coordination at the border.’’

‘’In those economies where a true Single Window has been put in place, it has benefited cargo clearance tremendously in terms of efficiency and cost,” she added.

More economies are also coming on board

Mexico joined the Single Window system in June 2012 with 11 government agencies and 2 participating regulatory agencies. This system will have increased functionality with private sector operators such as airports and rail companies to be included by the end of 2014.

However, companies in Mexico are already seeing the initial value.

“With the implementation of the Single Window, documents like the Certificates of Origin that are validated and issued by authorities are easily obtained. Also foreign trade programs are authorized in a more expedite manner,” said Hector Herrera, Partner at PwC Mexico’s Customs & International Trade division, who supports clients with managing their customs procedures in Mexico.

Chile is another APEC economy that is currently in the process of launching the initial stages of their Single Window system.

“In Chile, we are currently implementing the export module. During 2014, the import and transit module will be implemented as well,” said Joseph Nehme, the Ministry of Finance’s Executive Secretary of the Chilean Single Window project.

“The APEC Single Window workshops helped us confirm that many of the best practices are from advanced models in Asia,” he explained. “Actually, one of the information technology companies developing our system is originally from Singapore with offices in Panama, so we are looking at implementing best practices from them.”

Challenges remain

Nonetheless, domestic interoperability within economies still remains a hurdle.  The many different stakeholders involved creates a challenge to fully implementing the Single Window system across multiple government agencies.

In some economies, Ms Larsson explained, the implementation of the Single Window still has mixed results and requires further refinements.

“Often times, electronic procedures are duplicated with manual mandatory procedures and does not include all major government agencies involved in cargo clearance,” she added.  “Fully automated and integrated procedures, developed in consultation with business, would ensure success of a Single Window system.”

Moreover, rapidly changing technologies also pose complications.

“By the time Single Window systems are fully implemented in some economies, the information technology systems they are built on may have already become outdated,” explained Frank Debets, PwC’s Managing Partner for Worldtrade Management Services.

“It is also a challenge for small and medium sized companies (SMEs) to develop the infrastructure and expertise necessary to use the Single Window system. This creates a barrier to entry,” Mr Debets added.

APEC continues to address some of these challenges with more technical assistance to help economies implement their Single Window systems. In particular, APEC is also tackling the next big step of interoperability between APEC Single Window systems of member economies. Ultimately, the goal is to encourage non-members to adopt the system in a bid to increase global trade even further.

Officials are discussing these and other issues at the APEC Sub-Committee on Customs Procedures in Ningbo, China this week.

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