UNNExT Workshops on Trade Facilitation - UNESCAP TF - Case...UNNExT Workshops on Trade Facilitation Almaty, Kazakhstan 4-6 May 2015 UNNExT Workshop on Paperless Trade Facilitation

UNNExT Workshops on Trade Facilitation

Almaty, Kazakhstan 4-6 May 2015

UNNExT Workshop on Paperless Trade Facilitation for Small and Medium-Sized Entreprises

Trade Facilitation: Singapore experience

Backgroundq Singapore entrepot trade and logistics hub

q Higher volumes of trade; due to globalization, FDI, MNCs looking for cheaper locations in Asia, plethora of FTAs

q Traders are demanding faster clearance for their goods and increased administrative efficiency; Trade velocity; modern supply chain management techniques have increased the usage of “just-in time” manufacturing, global production sharing and outsourcing

BackgroundTrade Facilitation – the plumbing

q Cutting red tape at the border

q Reducing all transactions costs associated with enforcement, regulation and administration of trade policies (trade and tariff policy also plays a major role in trade facilitation)

q Involves simplification, harmonization and rationalization of trade procedures

Can be achieved through automation, applying modern risk analysis techniques, transport procedures, etc.

Source: Trade Facilitation from a Developing Country Perspective, National Board of Trade, Sweden, 2003

Background

TTF needs and prioritiesNeed forq Transparency of methods and proceduresq Avoid delays of portsq No corruptionq Packaging and labeling requirementsq Similar national standardsq Facilitating physical movement of consignmentsq Creation of more efficient payment and credit

arrangementsq Liberalization of exchange control, relaxation of stringent

requirements on formalities on payments, insurance and other financial requirements

Single Window Development and Single Window Development and ImplementationImplementation

Experience of SingaporeExperience of Singapore

Agenda

zz Experience of Singapore: The Single Window Implementation Experience of Singapore: The Single Window Implementation

zz The Next Big Thing: Integrated Single Window eThe Next Big Thing: Integrated Single Window e--LogisticsLogistics

zz Single Window InterSingle Window Inter--operabilityoperability

Infocomm21Late 90s

Fifth Wave

Connected Singapore2003 -

Fourth Wave

Background

Making Waves Since the 1980s ( Singapore Roadmap )Making Waves Since the 1980s ( Singapore Roadmap )

Third Wave

IT2000Early 90s

Second Wave

National ITPlanMid 80s

TradeNet•Conceptualized in 1986 as

part of National IT Plan• Implemented in 1st Jan 1989

by Singapore Customs

First Wave

National Computerisation PlanEarly 80s

Traders

Singapore CustomsCheckpoints

(ICA - Immigration Checkpoint Authority)

EDI VANOperator

Controlling Agencies

Trade & manifest info

PermitApplications

CargoClearancePermits

CargoClearance

Background

TradeNet TradeNet ProcessProcess

The Path of TradeNet The Path of TradeNet

Version 1.0 - 1.5

Version 1.6 - 1.7

Version 1.8 - 2.0

Version 3.1

•• Implemented Electronic SubmissionImplemented Electronic Submission•• Declarations were batched upDeclarations were batched up•• Turnaround time in few daysTurnaround time in few days

•• Improved validations & featuresImproved validations & features•• Incorporated GST requirementsIncorporated GST requirements•• Turnaround from hours to ~30 minutes.Turnaround from hours to ~30 minutes.

•• Interactive TradeNetInteractive TradeNet•• Integrate Internal Systems Integrate Internal Systems •• Business intelligence/risks profilingBusiness intelligence/risks profiling•• Approval within 2 Approval within 2 -- 5 minutes5 minutes

•• Major business process streamliningMajor business process streamlining•• Incorporated Export Control Incorporated Export Control

Consignment System (ECCS)Consignment System (ECCS)•• New HS Code (Asean Harmonized New HS Code (Asean Harmonized

Tarrif Nomenclature)Tarrif Nomenclature)

Background

1988 1988 --19901990

1991 1991 --19941994

19951995--20002000

20032003

2007 Ver 4.0

qq Formation of TradeNet Working Committee Chaired by NCB Formation of TradeNet Working Committee Chaired by NCB

(currently NCS) and Customs(currently NCS) and Customs

rr Business Process StudyBusiness Process Study

rr Trade documentation business processesTrade documentation business processes

rr Review all Manual processes involved Review all Manual processes involved

rr Standards DefinitionStandards Definition

rr Study and Review Goods Classification Study and Review Goods Classification

rr Legal Policy SupportLegal Policy Support

rr Introduction of Electronic Transaction Act Introduction of Electronic Transaction Act

rr Evaluate TechnologyEvaluate Technology

Design and Development Process

qq Systems DesignSystems Design

qq Consolidate Data Element to form TradeNet specifications.Consolidate Data Element to form TradeNet specifications.

qq Operations PlanOperations Plan

qq SOP & ContingencySOP & Contingency

qq Measure PerformanceMeasure Performance

qq Evolve, Improve and EnhanceEvolve, Improve and Enhance

qq Payment of Duty and GST via Electronic means ( GIRO )Payment of Duty and GST via Electronic means ( GIRO )

Design and Development Process

•• Submission of TradeNetSubmission of TradeNet applicationsapplications# Import/ Export/ Transshipment# Import/ Export/ Transshipment# Controlled/Non# Controlled/Non--controlled/Strategic goodscontrolled/Strategic goods# Payment/Non# Payment/Non--paymentpayment

# Cert of origin and other applications# Cert of origin and other applications

•• Amendment & Cancellation of TradeNetAmendment & Cancellation of TradeNet applicationsapplications

•• Auto Process of TradeNetAuto Process of TradeNet applications (more than 1000 applications (more than 1000 validation rules)validation rules)

•• Enquiry on application status via 24Enquiry on application status via 24--hours IVR ( Interactive hours IVR ( Interactive Voice Response System )Voice Response System )

•• Auto deduction of duty/GST via GIROAuto deduction of duty/GST via GIRO

•• Paperless clearance for TradeNetPaperless clearance for TradeNet permits (CCS)permits (CCS)

Structure and Services

Front-end

Software

Current Structure of TradeNetCurrent Structure of TradeNet

Technology

VAN

Operator

•• IBM IBM zSerieszSeries

•• MQ SeriesMQ Series

•• J2EEJ2EE

•• DatabaseDatabase

Dial-up or Internet

Leased Line

•• ClientClient--based based Software, Software,

•• Integrated with Integrated with TraderTrader’’s Ins In--house System orhouse System or

•• WebWeb--based based SoftwareSoftware

•• Interactive Interactive ProcessingProcessing

•• Online Online ProcessingProcessing

•• AutoAuto--Routing Routing (btw (btw Customs & Customs & CAs)CAs)

TradeNet Backend(Customs &

Controlling Agencies)

•• Centralised Centralised Customs Customs databasedatabase

Customs

Backend Systems(eg. Cargo clearance,

Revenue Mgmt, etc.)

EDI ( Using UNEDIFACT format)

Gov’tNetwork

Government AgenciesGovernment Agencies

qq Singapore Customs ( System Owner )Singapore Customs ( System Owner )

qq Controlled Agencies ( e.g. AVA, SPF, etc )Controlled Agencies ( e.g. AVA, SPF, etc )

qq IRAS ( Accounting of GST collection )IRAS ( Accounting of GST collection )

qq RCB ( Registration of Company and Business)RCB ( Registration of Company and Business)

qq IE Singapore ( Statistics department )IE Singapore ( Statistics department )

qq Chambers of Commerce for COO Chambers of Commerce for COO

Private SectorsPrivate Sectors

qq Systems Integrator and Operator (NCS) Systems Integrator and Operator (NCS)

qq FrontFront--end vendors ( e.g. IPACS, SCS, PSA Portnet) end vendors ( e.g. IPACS, SCS, PSA Portnet)

qq VAN operator (e.g. Crimson Logic)VAN operator (e.g. Crimson Logic)

Participants

Users:Users:

qq Importers/ExportersImporters/Exporters

qq Freight Forwarders/CarriersFreight Forwarders/Carriers

qq 3rd or 4th Party Logistic Companies ( 3PL/4PL )3rd or 4th Party Logistic Companies ( 3PL/4PL )

qq Port/Terminal Operators (PSA, Jurong Port)Port/Terminal Operators (PSA, Jurong Port)

qq Other Trade communities/portals (Warehouse Operators, CCN)Other Trade communities/portals (Warehouse Operators, CCN)

Statistics:Statistics:

qq 3,000+ registered declarant agents3,000+ registered declarant agents

qq 1,000+ customs staffs 1,000+ customs staffs

qq 30,000 transactions per day. 30,000 transactions per day.

Clients

qq FrontFront--End SystemsEnd Systems

qq Development funded by the Government.Development funded by the Government.

qq Operated as an ASP model with transaction charges Operated as an ASP model with transaction charges

qq Backend SystemBackend System

qq Development funded by GovernmentDevelopment funded by Government

qq Operation outsourced to private sector (NCS)Operation outsourced to private sector (NCS)

Business Model

To the Traders:To the Traders:

qq Simplified commercial framework for both domestic and internatioSimplified commercial framework for both domestic and international tradenal trade

qq Faster turnaround time (average approval within 5 minutes) Faster turnaround time (average approval within 5 minutes)

qq Improved Convenience and efficiencyImproved Convenience and efficiency

qq Productivity improvement and Costs savingProductivity improvement and Costs saving

qq Faster customs clearance w/ paperFaster customs clearance w/ paper--less and cashless transactionsless and cashless transactions

To the Government:To the Government:

qq Increased effectiveness of control methodsIncreased effectiveness of control methods

qq More effective and efficient deployment of resourcesMore effective and efficient deployment of resources

qq Improved trader complianceImproved trader compliance

qq Facilitates business intelligence through better/faster data capFacilitates business intelligence through better/faster data capturingturing

qq Accelerated economic development & Encourage Foreign InvestmentAccelerated economic development & Encourage Foreign Investment

Results

Single Window BenefitsSingle Window Benefits

qq Conduct BPR within agencies to remove redundancy and Conduct BPR within agencies to remove redundancy and

streamline processes and procedures (for both manual and streamline processes and procedures (for both manual and

automated systems)automated systems)

qq Use industry standards for electronic messaging to ease Use industry standards for electronic messaging to ease

adoption (e.g. UNEDIFACT, ebXML, RosettaNet ) adoption (e.g. UNEDIFACT, ebXML, RosettaNet )

qq Standardise practises on trade documentation and Goods Standardise practises on trade documentation and Goods

classification ( to achieve cross border trading )classification ( to achieve cross border trading )

qq Close Collaboration & Consultation with all parties involved, Close Collaboration & Consultation with all parties involved,

including private sectorsincluding private sectors

Critical Success Factors

qq Liberalisation of VAN for competitive pricing & servicesLiberalisation of VAN for competitive pricing & services

qq Deeper integration into trade communities & processesDeeper integration into trade communities & processes

qq Objective is to reduce duplicate data entry, facilitate Objective is to reduce duplicate data entry, facilitate

information sharing and increase cost savings.information sharing and increase cost savings.

qq Centralised platform to act as National Hub to facilitate Centralised platform to act as National Hub to facilitate

trade activities trade activities

Future Plans

Singapore TradeNet:Singapore TradeNet:

IntegratedIntegrated Single Window eSingle Window e--LogisticsLogistics

““A neutral and open platform enabling the integration and A neutral and open platform enabling the integration and collaboration among trade, logistics, financial and government collaboration among trade, logistics, financial and government communities to fulfill import, export or transit processes and communities to fulfill import, export or transit processes and

documentation through electronic means, in order to increase documentation through electronic means, in order to increase information velocity, visibility and accuracy.information velocity, visibility and accuracy.””

•• SingleSingle--Window for all logistical information, requests, and Window for all logistical information, requests, and exchange.exchange.

•• Trade DeclarationTrade Declaration will be will be oneone of the Core Applications of the Core Applications •• Owned and Run by Government or Private SectorOwned and Run by Government or Private Sector

Integrated Single Window e-Logistics

ExporterBank

Customs

Domestic Carriers

Sea Ports & International

Carriers

Importer

Bank/ Insurance

Freight Forwarders

ShippingInstructions

P.O.

BL

BL, Invoice,Pack List,

etc

Statuses/Changes

LC

Imagine the scenario of 2000 shippers, 200 LSPs, 20 Banks, 20 Carriers?

A Logistics Scenario Today:A Logistics Scenario Today:

% Data Re-entry?

Declaration/Permits

Rates &Schedules

LCApplication

Manual or electroniccommunication


•• Highly fragmented, nonHighly fragmented, non--standardized communication methods due to standardized communication methods due to

explosion in logistics outsourcing in recent yearsexplosion in logistics outsourcing in recent years

•• Players (MNCs/SMEs) have different capability levels to transactPlayers (MNCs/SMEs) have different capability levels to transact

electronicallyelectronically

•• High effort and cost to establish pointHigh effort and cost to establish point--toto--point connectivity w/ new business point connectivity w/ new business

partners or to cater for new business processes.partners or to cater for new business processes.

•• High rate of data reHigh rate of data re--entry at multiple process points, including trade entry at multiple process points, including trade

declarationdeclaration

•• Lack of proper system controls lead to errors, fraud and cargo dLack of proper system controls lead to errors, fraud and cargo delays elays --

impacting all parties in the supply chainimpacting all parties in the supply chain

•• Net results: inefficiency and wastage in the nationNet results: inefficiency and wastage in the nation’’s trade & logistics ecos trade & logistics eco--

system leading to uncompetitiveness.system leading to uncompetitiveness.

Key Issues in eKey Issues in e--Logistics Today:Logistics Today:


Exporter

Customs 3PL/ Domestic Carriers

Sea Ports & International

Carriers

Bank/ Insurance

Freight Forwarders


Schedule/Status

Statuses/Changes

Declaration/Permits

Rates &Schedules

Electroniccommunication

DraftBL

OBL


BL, Invoice,Pack List,

etc

Value-AddSolutions

MessageTranslation

Services

Ope

n S

tand

ards

Ser

vice

Ori

ente

d A

rchi

tect

ure

DraftBL

OBL

Permit

Integrated Single Window eIntegrated Single Window e--Logistics ScenarioLogistics Scenario


•• Provides translation and routing services among partners, with sProvides translation and routing services among partners, with support for upport for

common international protocols (EDIFACT, XML, Rosettacommon international protocols (EDIFACT, XML, Rosetta--Net, etc.)Net, etc.)

•• Low cost solutions through either web application or 3rd party ALow cost solutions through either web application or 3rd party ASP to SP to

enable local SMEs to participate in digital economyenable local SMEs to participate in digital economy

•• Low cost, easy and quick establishment of interface with new busLow cost, easy and quick establishment of interface with new business iness

partnerspartners

•• ReRe--use of data where relevant and when desired, to eliminate reuse of data where relevant and when desired, to eliminate re--entry of entry of

datadata

•• Improve (paperImprove (paper--less) handling trade documentation, resulting in timely less) handling trade documentation, resulting in timely

delivery and clearance from portsdelivery and clearance from ports

•• Ultimate results: an efficient ecoUltimate results: an efficient eco--system to facilitate trade and logisticssystem to facilitate trade and logistics

Key Benefits of Integrated S.W. eKey Benefits of Integrated S.W. e--LogisticsLogistics


BusinessBusinessValueValueChainChain

Single Single WindowWindowCustomsCustoms

Integrated S.W.Integrated S.W.ee--LogisticsLogistics

Integrated S.W. Integrated S.W. Global TradeGlobal Trade

DetachedDetached

B2B B2B --> B2ga> B2ga G2G G2G --> B2G> B2G N2NN2N

AgencyAgencyPortalsPortals

<1980s<1980s>1985 >1985

>1995>1995

>2005>2005’’ss

>2010>2010’’s ?s ?

PrePre--InternetInternetEraEra

Integration ScopeIntegration Scope

Towards S.W. Global TradeTowards S.W. Global Trade

Single Window Inter-operability

The ProblemThe Problem


Source: Andrey Masalovich, Natalia Makarycheva

Why the need for crossWhy the need for cross--border interborder inter--operability?operability?

The landscape of global business is being shaped and driven by:The landscape of global business is being shaped and driven by:

•• Increased scale of competition:Increased scale of competition:•• 19801980’’s s -- Competition of Product Superiority (TQM)Competition of Product Superiority (TQM)•• 19901990’’s s -- Competition of Supply Chain (B2B)Competition of Supply Chain (B2B)•• 20002000’’s s -- Competition of National EcoCompetition of National Eco--system for Trade Facilitation (G2G, B2G)system for Trade Facilitation (G2G, B2G)•• 20102010’’s s -- (Prediction) Competition between Regional Eco(Prediction) Competition between Regional Eco--system for Trade Facilitation (N2N)system for Trade Facilitation (N2N)

•• Increased volume of cross border trade and the need for capacityIncreased volume of cross border trade and the need for capacity to handle it.to handle it.•• FTA and WCO implementations to facilitate international trade cFTA and WCO implementations to facilitate international trade collaborationollaboration•• Lower cost, and simplification of crossLower cost, and simplification of cross--border processesborder processes•• Fraud detection and controlFraud detection and control

•• Increased physical threat to business and national securityIncreased physical threat to business and national security•• 911, financing and smuggling of weapons911, financing and smuggling of weapons

•• Increased physical, health and social threat to citizens from naIncreased physical, health and social threat to citizens from natural disasters or tural disasters or biological importsbiological imports

•• SARS, Avian Flu, Drug recalls, etc.SARS, Avian Flu, Drug recalls, etc.•• Disaster relief operationsDisaster relief operations


Haulier

Forwarder

Customs

Bank

SellerCountry A

BuyerCountry Z

International

Carriers

Country A

Beyond Borders: a NationBeyond Borders: a Nation--toto--Nation (N2N) Vision Nation (N2N) Vision

HaulierForward

er

Customs Bank

International

Carriers

Haulier

Forwarder

Customs

Bank

SellerCountry A

International

Carriers

Country B

Country C

Federated Enterprise Reference Architecture• Message Converter • Registry & Repository• Collaborative Event Handler• Metrics & Reporting Engine• Choreographer Tools• ebXML, RosettaNet, Web Services


Create trade exchange

Examples of Purposes and BenefitsExamples of Purposes and Benefits

•• Single Trade Declaration Single Trade Declaration -- rere--use of export data for import.use of export data for import.•• Import permit applicationImport permit application•• Submission of manifests and other documentsSubmission of manifests and other documents•• Each country retains its own customs procedures and workflow.Each country retains its own customs procedures and workflow.

•• Trade Monitoring & ControlsTrade Monitoring & Controls•• Visibility of cargo content from port of originVisibility of cargo content from port of origin•• Track & Trace of carrier and container routesTrack & Trace of carrier and container routes

•• Trade Regulations StreamliningTrade Regulations Streamlining•• Clearer export/import and simplified compliance effort for tradClearer export/import and simplified compliance effort for tradersers•• Faster verification of information leading to faster revenue coFaster verification of information leading to faster revenue collection llection •• Facilitate easier implementation of future security & other traFacilitate easier implementation of future security & other trade policiesde policies


•• Firstly, improve internal government efficiencies & automation tFirstly, improve internal government efficiencies & automation toward a comparable oward a comparable performance standard (benchmark)performance standard (benchmark)

•• Build your Customs or eBuild your Customs or e--Logistics Single Window with Logistics Single Window with ““endend--inin--mind.mind.””

•• Adopt and support international or open standards for systems deAdopt and support international or open standards for systems development, velopment, messaging, product codes and other specifications.messaging, product codes and other specifications.

•• Adopt a common data messaging and security framework, supported Adopt a common data messaging and security framework, supported by governments and by governments and trusted by traders.trusted by traders.

•• Enhance Regulatory and Legal framework to support crossEnhance Regulatory and Legal framework to support cross--border electronic document border electronic document exchange. exchange.

•• Begin with specific, low risk product categories to achieve SingBegin with specific, low risk product categories to achieve Single Declaration and/or Single le Declaration and/or Single Inspection with another country. Balance between trade facilitatInspection with another country. Balance between trade facilitation and security.ion and security.

•• Collaborate with commercial organizations and associations to adCollaborate with commercial organizations and associations to address the issues of Letter of dress the issues of Letter of Credit, Bill of Lading, Inspection Certificates, etc.Credit, Bill of Lading, Inspection Certificates, etc.

learningslearnings


Documents

UNNExT Workshops on Trade Facilitation - UNESCAP TF - Case...UNNExT Workshops on Trade Facilitation Almaty, Kazakhstan 4-6 May 2015 UNNExT Workshop on Paperless Trade Facilitation