Customs barriers raise cost of international trade

By Vincent Lingga

SINGAPORE (JP): The Paris-based International Chamber of Commerce says significant customs barriers which are unnecessary for legitimate customs purposes continue to restrict, distort and raise the costs of cross-border trade.

Arthur Dunkel, Chairman of the ICC Commission on International Trade and Investment Policy, raised the customs issue at the second and last day of the World Trade Congress meeting here yesterday.

Dunkel, former director general of the General Agreement on Trade and Tariffs (replaced by the World Trade Organization in 1995), said it was now high time customs procedures were modernized and simplified.

"While the WTO agreements offer the prospect of lower trade barriers and greater market access for goods and services, customs barriers distort and raise the costs of international trade," he pointed out.

The customs problem will be one of the major issues the ICC will bring up to the first WTO ministerial meeting in Singapore in December.

"The problem has become of growing importance as more companies seek to become just-in-time suppliers and strive to reduce the costs of sales in an increasingly competitive global marketplace," Dunkel pointed out.

He called for greater cooperation between governments and businesses to tackle such problems as lack of automation or electronic standards, arbitrary documentation and bonding requirements, unwarranted fees or overtime charges for normal customs inspections, restrictions on normal business hours and reluctance to accept pre-arrival customs documents for review.

The ICC's views were echoed by Graham Davey, the managing director for Southeast Asia of DHL Worldwide Express, an express air freight company, at a special session of the WTC meeting yesterday.

Davey said express air freight services require pre-clearance of goods in the air and depend for efficient service on 24-hour customs services to match inbound flight arrival times.

He acknowledged that customs clearance remains a major obstacle to express-cargo growth.

Davey suggested that customs service embrace and implement electronic data interchange to global standards to speed up clearance of goods.

"We expect the same clearance treatment as postal authorities," he said.

Dunkel said that the ICC, in an effort to address the problem, is drafting its own comprehensive International Customs Model which is intended to serve as a benchmark and check-list for assessing and improving the quality of customs services.

"The ICC is consulting the World Customs Organization on this model which has much in common with the WCO's plan for customs reforms set out in the 1994 Columbus Declaration on Trade Efficiency," he added.

The ICC, he said, has suggested that the WTO ministerial meeting in Singapore establish a joint WTO-WCO committee to examine the impact of customs procedures on trade.

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