customs reform
TRANSCRIPT
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December2011
CustomsReforminAfghanistan:
MovingBetweenIntroducedand
Pre-exis=ngStructures
AfghanistanPublicPolicyResearchOrganiza
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Acknowledgements
ThispaperisaproductofaresearchprojectfundedbyHarakatAfghanistanClimateInvestmentFacility.APPROexpresses
itssincerethankstoHarakatfortheirsupportandfeedbackonthevariousaspectsofthisresearch.Thisresearchwould
nothavebeenpossiblewithouttheacEveparEcipaEonandassistancefromthemanytradersandcustomsofficialswho
wereapproachedbyAPPRO.
APPROtakesfullresponsibilityforallomissionsanderrors.
AbouttheAuthors
LeadauthorsforthispaperareSaeedParto(DirectorofResearch)andEhsanSaadat(Researcher).AhmadShaheerAnil
(ResearchandvaluaEonsManager)managedthefieldwork.RebeccaGangeditedthisreport.
AboutAPPRO
AfghanistanPublicPolicyResearchOrganizaEon(APPRO)isanindependentsocialresearchorganizaEonpromoEngsocial
andpolicylearningtobenefitdevelopmentandreconstrucEoneffortsinAfghanistan.APPROisregisteredwiththeMinistry
ofconomy(RegistraEonNumber:1212)asanot-for-profit,non-governmentorganizaEonandheadquarteredinKabul,
Afghanistan.
APPROsmissionistofacilitatecriEcaldialogueonpolicyandreconstrucEonissues.Thismissionhastwocomponents.The
firstcomponentistomeasuredevelopmentprogressagainststrategicreconstrucEonobjecEvesandprovideinsightsinto
howtoimproveperformanceagainstthemilestonessetbytheGovernmentofAfghanistanandtheinternaEonaldonors.
ThesecondcomponentistotrainandmentorapoolofAfghanresearcherstoconductresearchconsistentwith
internaEonallyrecognizedstandardsforsocialscienEficresearch.ResearchatAPPROisundertakentoaddressexisEngand
pressingknowledgegapsinthepolicymakingprocessandtoadvancethelearningofresearchers,academics,anddecision
andpolicymakersatalllevels.
i
(c)2011.AfghanistanPublicPolicyResearchOrganizaEon.Somerightsreserved.ThispublicaEonmay
bereproduced,storedinaretrievalsystemortransmi\edonlyfornon-commercialpurposesandwith
wri\encredittoAPPROandtheauthors.WherethispublicaEonisreproduced,storedortransmi\ed
electronically,alinktoAPPROswebsitewww.appro.org.afshouldbeprovided.Anyuseofthis
publicaEonfallingoutsideofthesepermissionsrequirespriorwri\enpermissionandcanbesoughtby
[email protected]+93700538081.
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TableofContents
...................................................................................................................xecuEveSummary 1
..........................................................................................................................1.IntroducEon 4
2.ObjecEvesandMethodology.................................................................................................5
3.CustomsReformSince2001..................................................................................................6
4.Keyfindings ...........................................................................................................................9
4.1.Hairatan .......................................................................................................................11
4.2.IslamQala ....................................................................................................................11
4.3.Torkham.......................................................................................................................12
4.4.CommonChallenges....................................................................................................13
5.Conclusion ...........................................................................................................................14
6.RecommendaEons ..............................................................................................................16
............................................................................................................................Bibliography 19
.............................................................Appendix1:CustomsReformProgramsandProjects 20
.........................................Appendix2:CustomsClearanceProcedures(innglishandDari) 21
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Glossary
APPRO AfghanistanPublicPolicyResearchOrganizaEon
ASYCUDA AutomatedSystemforCustomsData
HOO HighOfficeofOversightandAnEcorrupEonMAIL MinistryofAgriculture,IrrigaEonandLivelihood
MoCI MinistryofCommerceandIndustry
MoF MinistryofFinance
MoI MinistryofInterior
UNCTAD UnitedNaEonalConferenceonTradeandDevelopment
UNDP UnitedNaEonsDevelopmentProgramme
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Execu4veSummary
Afghanistanishighlydependentonimports.AfuncEonalcustomssystemwithminimalornoleakage
indutycollecEoncanbeareliableandsustainablesourceoffundsfortheGovernmentof
Afghanistan.RecognizingtheimportanceofafullyfuncEonalcustomssystemasasourceof
governmentrevenue,effortshavebeenmadebyalonglistofinternaEonaldonorstomodernizeand
systemaEzethecustomssysteminAfghanistan.
ThisresearchwascarriedoutfromFebruarytoAugust2011toassesstheimpactofthechanges
madesince2001andtoidenEfypathwaysforfutureplanningandprogrammingina\emptsto
insEtuteafullyfuncEoningcustomssystem.TheraEonaleforthisresearchwasthatfurtherplansto
reformthesystemneedtobebasedonacloseexaminaEonofwhathasbeenaccomplishedtodate
andtheidenEficaEonofthebarriersandbo\lenecksthatAfghantradersconEnuetofaceinmovingmerchandizetoandfromtheborderentrypoints.
TheresearchfindsthatachangeofthenormsthatunderliecorrupEoninthecustomssystem
requiresallmannerofmeasuresrangingfromproceduraladjustments(shortterm)toincreased
oversightandenforcement(mediumterm)tovalue-basedbehavioralchangeamongthecustoms
systemsofficialsandtradersthroughawarenessraising,educaEon,andasystemofincenEvesand
disincenEves(longterm).Failuretoa\endtothemulE-layeredneedsofthecustomssystemruns
theriskofageneralweakeningoftrustinthesystembylegiEmatenaEonalandinternaEonal
investorswhowouldbeeitherdissuadedfrominvesEngduetoahighlevelofriskand
unpredictabilityor,iftheydecidetoinvest,arelikelytotolerateand,bydefault,helpperpetuate
corruptpracEces.AnetoutcomeofthesetrajectorieswilldepriveAfghanistanofdesperately
neededlegiEmatetradeacEvityanddirectinvestmentbynaEonalandinternaEonalinvestors.
TheheavilyfundedmulE-donorandmulE-yearprojecttobuildandmaintainAfghanistanscustoms
systemislikelytobeaslowprocess.Thedutyrateshavetobethoughullysettoencourage
importerstoconEnuetogothroughthesystemratherthanoutsideit.Dutychargesneedtobe
enEcingenoughtokeeptheimporterscomingthroughlegalchannelssothattheGovernment
conEnuestocollectcustomsrevenue.Oncetheacceptablethresholdfordutylevelsispassedand
thedutyisdeemedtoohighbythetradersthelicitimporteristemptedtogothroughinformal/
illegalchannels,causingrevenuelossesfortheGovernment.
Adequatesalariesarebutonemeasureintheoverallpackageofmeasuresthatneedstobeput
togetherinthereformofthecustomssystem.Ifitisnotpossibletoincreasesalariesimmediately
andsufficiently,otherinnovaEveincenEvesneedtobedeployedtobringbriberyundercontrol
through,forexample,commission-basedbonusestothecustomsofficials.Otherformsofassistance
toincreasethecapacityandcapabilityofcustomsemployees,suchasappoinEnginternaEonal
advisorsatportsofentry,shouldbedonemorethoughully.
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Thereisaneedtostrengthenlawenforcement,yettherehastoberecogniEonthatenforcingthe
lawisoenafuncEonoftheabilitytoenforceandafullsetofincenEvesanddisincenEveforthose
subjectedtothelaw.Consistentlawenforcementinthelongrunislikelytoresultinchanged
behaviorbytheofficialsandthetradersalike.Forthistohappen,theusersofthecustomssystem
(customsofficialsandtraders)willhavetobecomepartofthesoluEonbybeingincludednthe
discoursetoaddresscorrupEon.
Theproblemsandbo\lenecksinthecustomssystemarelesstodowithinadequaciesinthe
infrastructureandproceduresandmorewithsystemiccorrupEon.ChangesininformalinsEtuEons
suchascorrupEontakealongEmetobecomeestablished,andwillrequireallmannerofincenEve
anddisincenEvewhichmaybemonetaryandnon-monetary,proceduralandregulatoryand,most
importantly,innovaEveandinteracEvetomaximizelearningbydoing.TheformalizaEonoftherole
ofkomishenkarsinthecustomssystemservesasagoodexample.Thereisnoimmediateone-Eme
soluEontothebo\lenecksinthecustomssystemandcurrentlythereisli\leornoincenEveforthe
usersofthesystemtochangeit.Muchcouldbeaccomplished,however,throughreforminwages
and/orotherformsofremuneraEon,increasedandtransparentoversight,and,mostimportantly,
engagementandlearningwithaviewtoinnovateandeffectinsEtuEonalchange.
KeyRecommenda,ons
- ConEnuethebuildingandmodernizaEonofcustomsinfrastructure.Atmajorpointsofentry,i.e.,Hairatan,IslamQala,andTorkham,Afghanistanscustomssystemisoneofthemosta\endedto
andmodernizedinSouth/CentralAsiaandtheMiddleast.ffortstomaintainthecurrent
funcEonsandincreaseadherencetotheproceduresthroughmoreeffecEveenforcementand
oversightwillneedtobeintensified,bearinginmindthatinsEtuEonalizaEonofthemany
changesplannedforthecustomssystemislikelytotakemanyyears.
- IniEateaprocessofdialoguetoinvolvetheMinistryofFinance,HighOfficeofOversight,Ministry
ofCommerceandIndustry,representaEvesoftradersandotherprivatesectorrepresentaEve,
andotherrelevantparEesonhowtoconEnueeffortstoimplement/enforcecustomslawandrelatedregulaEonsandproceduresanddevisewaysofminimizingarbitrarinessinthepracEces
ofcustomspersonnel.IntermediaryorganizaEons,suchasHarakat,arewellposiEonedtoiniEate
suchadialogue.TheoutcomesfromthisdialogueshouldincludeintervenEonstoincreasethe
integrity,independence,andauthorityofthecustomssysteminrelaEontoothergovernmental
agenciesacEveinborderareas.
- Maintaineffortstoimproveinfrastructure,providetrainingandcapacityexchange,raisesalaries
andotherformsofremuneraEon,andinsEtuteafuncEoningoversightmechanismtoinclude
monitoring,evaluaEon,andperiodicaudits.
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- FormallycerEfykomishenkarsaslegiEmateactorsinthecustomsprocesswhiletakingstepsto
ensurethattheyreportonthefeeschargedandtaxespaidonearnedcommissions.
- ConEnuetobuildcooperaEonandharmonizaEonthroughcustomstreaEes,forexample,with
neighboringcountries.Forthistohappen,andforAfghanistantomaximizebenefitsfromsuch
associaEons,Afghanistanneedstoaddresstheremainingproblemsinitscustomssystem(mostly
relatedtocorrupEon)simultaneouslywithstrengtheningEeswithregionalandinternaEonal
partners.
- ConductfurtherresearchtounderstandthebackendofcustomsoperaEons.Thescopeofthis
researchwaslimitedtoanexaminaEonofthefrontendofcustomsoperaEons,focusingonhow
usersandofficialsprocessgoodsthroughthesystem.Tofurtherbenefitthedesignand
implementaEonofreformsinthecustomssystemitwillbenecessarytoinvesEgate,forexample,
howcollectedduEesaretransferredfromtheborderintoGovernmentrevenuestreams,towhat
usecollectedrevenuesareput,andhowtheseaspectsofthesystemaffectdaytodayoperaEons
attheborderpointofentry.
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1.Introduc4on
Afghanistanishighlydependentonimports.Thecustomssystemplaysaninstrumentalroleinboth
facilitaEngandcurtailingtransferofgoodsbetweenAfghantradersandtheircustomersorsuppliers
inadjacentcountries.InaddiEon,afuncEonalcustomssystemwithminimalornoleakageinduty
collecEoncanbeareliableandsustainablesourceoffundsfortheGovernmentofAfghanistan.
RecognizingtheimportanceofafullyfuncEonalcustomssystemasasourceofgovernmentrevenue,
effortshavebeenmadebyalonglistofinternaEonaldonorstomodernizeandsystemaEzethe
customssysteminAfghanistan.1
ThemostrecentmajoreffortbytheGovernmentandtheinternaEonaldonorsinstreamliningthe
customssystemisarEculatedintheFiveYearStrategicPlan(2007-2012).2Thekeyareasof
intervenEoninclude(re-)organizaEonofthecustomssystemsworkforce,protecEonofcustomssystemsusers,i.e.,traders,improvementininfrastructureandequipment,andraEonalizaEonof
laws,procedures,andautomatedprocessestominimizecontactbetweencustomspersonneland
othergovernmentofficersandtraderstominimizerentseekingopportuniEesandcorrupEon.The
addedadvantageofafuncEoningcustomssystemistheminimizaEonandcontrolofsmuggling
goodsincludingnarcoEcsandhazardousmaterials.
Theremainderofthisstudyisstructuredasfollows.ThenextsecEonoutlinestheobjecEvesand
methodologyforthisstudy.SecEon3providesanoverviewofcustomsreformstodateandidenEfies
someoftheremainingchallengesinfurtherimprovementstothecustomssystem.SecEon4
analyzesthedatacollectedfromthreeportsofentry(Hairatan,IslamQala,andTorkham).Where
appropriate,theanalysisdrawsondatafromsecondarysourcesincludingAPPROsotherresearch.
SecEons5and6concludewithrecommendaEonsforconsideraEonbynaEonalandinternaEonal
policymakersinvolvedincustomsreform.
4
_____________________________________________________________________________________
1ThelistincludesAsianDevelopmentBank,DfID,UCommission,GermanGovernment,ItalianGovernment,Iranian
Government,JapaneseGovernment,USAID,andtheWorldBank.
2GovernmentofAfghanistan(2007).AfghanistanCustomsDepartment(ACD):AFiveYearStrategicPlan(2007-2012),(Kabul:MinistryofFinance,GovernmentofAfghanistan).
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2.Objec4vesandMethodology
Thegoalforthisstudywastodocumentprogresstodateandongoingchallengesinthereformof
AfghanistanscustomssysteminordertogeneratefindingsandrecommendaEonsforuseinfuture
customs-relatedpolicymakingandprogramming.TheobjecEvesfortheresearchwerethusto:
1. Documentreformstothecustomssystemsince2001;
2. IdenEfyprogressandremaininggapsincustomsreform;
3. PinpointareasofconEnueddifficultyforcustomssystemusers,includingbo\lenecks,
duplicaEveorunnecessaryprocesses,andopportuniEesforcorrupEon;and
4. IdenEfypossibleentrypointsforintervenEontoaddresscorrupEonamongkeyprivateand
publicsectoractorsinthecustomssystem.
TomeettheseobjecEvesresearcherscompletedadeskreviewofcustoms-relatedreforminiEaEvesinAfghanistansince2001andaseriesofinterviewswithkey,Kabul-based,naEonalandinternaEonal
stakeholdersandexpertsinvolvedincustomsreform.Forthisstudyinterviewswereheldwith
individualtraders,brokers(komishenkars),andcustomsofficialsatthethreeborderpointsandKabul
whiletwofocusgroupswithbusinessesandadisseminaEonworkshoptoverifythefindingswere
heldinKabul.
ThisresearchwascarriedoutfromFebruarytoAugust2011,threeyearsintotheimplementaEonof
theFiveYearStrategicPlan.ThesitesforthisresearchwereTorkham,controllingtheborderwith
Pakistan,Hairatan,controllingtheborderwithUzbekistan,andIslamQala,controllingtheborder
withIran.AlthoughAfghanistansautomatedcustomssystemshouldoperateidenEcallyacrossthe
country,itwasassumedthattherewouldberegionalandsite-specificvariaEons.TheselecEonof
threegeographicallyandethnicallydisEnctbordersiteswasthusintendedtohighlightbothnaEonal
andsite-specificpa\erns.
ThestudyoriginallyplannedtoembedanAPPROresearcherwithaconsignmentofgoodstobe
importedintoAfghanistanandthenescorttheconvoytoitsdesEnaEoninordertoobservethe
customsprocessandin-countrytransitcondiEonsfirst-hand.However,thiswasdeemedunsafein
thepresentsecurityenvironmentandwasnotfulfilled.Tocollectdata,threeteamsoftwo
researchersspenttwoweeksineachborderlocaEontoobservecustomsproceduresandtoconduct
interviewswithcustomsandborderofficials,truckdrivers,andkomishenkars.Researchersfurther
conductedin-depthinterviewswithatleasttenindividualtradersateachborderlocaEon,selected
onthebasisoftheirregularuseoftheborderpoint.
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3.CustomsReformSince2001
AfuncEonalcustomssystemisareliableandsustainablesourceforgovernmentrevenuegeneraEon.
Recognizingthis,internaEonaldonorprogrammingonthereconstrucEonofAfghanistansince2002
hasplacedparEcularemphasisonimprovingandexpandingcustomsfaciliEesandpracEcesatmajor
bordercrossingpoints.In2003thecustomsDepartmentoftheMinistryofFinanceintroduceda
SingleAdministra8veDocumentsystempilotprogram,basedontheuropeanUnionscustoms
system,inthefivekeyprovincesofKabul,Herat,Kandahar,Balkh,andNangarhar. 3In2005work
begantoimplementtheAutomatedSystemforCustomsData(ASYCUDA),whichiscurrentlyongoing.
TheFiveYearMasterPlanoftheAfghancustomsDepartment(MinistryofFinance)reportsan
esEmatedtotalprojectexpenditureof$202millionforstrengtheningandexpandingthecustoms
system.4KeyareasofintervenEonandreformaccordingtothisPlanareminimizingleakageinduty
collecEonthroughraEonalizaEonoflaws,procedures,andautomatedprocessestofacilitateclearanceofgoodsandminimizecorrupEonamongsystemusersandoperators.5
Twokeyelementsinthisreformprocessaretheexpressedintenttoformpartnershipswithtraders
throughwhichtoencouragevoluntarycompliancewithlawsand,secondly,toimprovetheinternal
organizaEonofthecustomssystemfocusingoneffecEveandefficientstructures,logicaldefiniEonof
roles,fairrecruitmentsystem,servicecondiEons,accountability,conductanddisciplinaryrules,
trainingsupport,andbuilt-inmechanismsforthepromoEonofethicsamongthestaff.6Otherareas
offocushighlightedinthePlanincludeprotecEonofcustomers,interdicEonofdangerousgoods,
collaboraEonwithfiscalaudits,collecEonoftaxesatsource,andexpansionofphysicalstructuresfor
customsoperaEon.
AccordingtotheFiveYearStrategicPlan,someofthekeyachievementssince2003inreformingthe
customssystemincludetheconstrucEonofinfrastructurefaciliEesatmajorborderpoints,
enactmentofamoderncustomslegislaEon,harmonizedsystemfortheclassificaEonandcodingof
goods,developmentofasinglecustomsFormforcustomsdeclaraEons,adopEonofASYCUDAfrom
UNCTAD,computerizaEonoftransitproceduresthroughthephasedimplementaEonofASYCUDA
commencingin2005,import-relatedexempEonspolicyandprocedures,automateddatacollecEon
andproducEonofcustomsstaEsEcs,customsbrokersprogram,andacquisiEonofinformaEon
technologyandotherequipmentanduniforms.
6
_____________________________________________________________________________________
3AltaiConsulEng.2007.ChallengesPresentedbytheLegalandRegulatoryFrameworkGoverningPrivateSector,For-profit
AcEvityBackgroundpaperpreparedforthenablingnvironmentConference,organizedbyAgaKhanDevelopment
NetworkinAugust2007,Kabul,Afghanistan.Also,DepartmentofState(2009),DoingBusinessinAfghanistan:2009
CountryCommercialGuideforU.S.Companies.(WashingtonDC:UnitedStatesGovernment).
4ACD.2007.AfghanCustomsDepartment:AFiveYearStrategicPlan(2007-12).(Kabul:GovernmentofAfghanistan).
5ACD.2007.AfghanCustomsDepartment.6ACD.2007.AfghanCustomsDepartment.
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Thereremainmajorbasicchallenges,however,atcustomsfaciliEesevenatimportantborderpoints
suchasTorkham,IslamQala,andHairatan.Theseincludelackofelectricityand/orgenerators,or
lackoffuelforgenerators,lackofadequaterunningwaterandsanitaryfaciliEes,lowsalariesof
customsstaff,anddeterioraEngsecurityandtheemergenceofaparallel,shadowcustomssystem.
Theuseofthenewphysicalinfrastructureandbuildingsbeingbuilttoservecustomspurposesare
someEmescontestedbyothergovernmentalbodiessuchastheborderpolicewhoalsohaveneeds
forbe\erfuncEoningphysicalstructures.InaddiEontocustomsofficialspresentatmajorborder
entrypointsaretheborderpolice,MinistryofCommerceandIndustry(MoCI)whichownsmuchof
thelandaroundimportantcustomspointsandcollectsdutyonselectedgoodsenteringthecountry,
MinistryofInterior(MoI)whosefuncEonistomonitorimportofintelligenceequipment,Ministryof
Culturewhichvetscontentsofwri\enandrecordedmaterialsenteringthecountry,Ministryof
PublicHealthwhichchecksthestandardsofimportedmedicalgoods,provincialgovernors
representaEvesparEcularlyinJalalabadwheretheGovernorsofficehasstaEonedaround20
peoplewhoimposeadevelopmentlevyongoodsenteringfromPakistan,AfghanistanNaEonal
StandardAuthoritywhichchecksthequalityofvariousgoodstoensurecompliancewith
internaEonalstandards,andMinistryofAgriculture,IrrigaEonandLivestock(MAIL)whichchecksall
importsofagriculturalproducts.
RumorsrunrifeatvariousborderpointsaboutwidespreadcorrupEonrunningthroughthe
operaEonsofthesevariousenEEesandtherebeingli\leornoopportunityforregistering
complaintsorhavingcomplaintsaddressedinaEmelyandjustmanner.Thereisli\lefaithinthe
abilityofthecustomssystemtofulfillitsmandateofmanagingandoverseeingthedaytodayworkingofthecustomsandrelatedworkforce,ensuringthatcorrupEonischecked,andthatthe
customschargesareappliedconsistently,fairly,transparently,anddiligently.TheimplementaEonof
ASYCUDAsince2005hasstreamlinedthecustomsprocedurestofoursteps,takinganaverageEme
ofaround90minutestocomplete.PartoftheASYCUDAsystemisacomprehensivelistof6,000
codesforallmannerofgoodstobeenteredintothecomputerizedsystemandfortheappropriate
feetobeapplied.This,togetherwithX-rayfaciliEesatTorkhamandIslamQala(butnotyetat
Hairatan)shouldmakeforanefficientsystemofcheckingcargoandregistraEonswhileapplying
standardizedfees.However,asthefindingsfromthisstudyshow,theimplementaEonofthe
ASYCUDAandotherprojectstostructureandmodernizethecustomssystem,andtheadopEonoflegislaEoninaccordancewithinternaEonalpracEcesmustbeviewedasthestartofalongerprocess
ofphysicalandhumancapacitydevelopmenttoensurethatthenewphysicalstructuresandwork
procedures,technologies,andlegislaEonareappropriatelyallocated,learned,andapplied
consistentlyandwitheffecEveoversightmechanisms.
Otherdeficienciesincludelackofadequatelytrainedpersonneltocollectandanalyzecustomsdata
andtogeneratereportstoinformfurtherreformandimprovementsinthesystem.ConflicEng
mandatesand/orjurisdicEonsoftheMinistryofInterior,MinistryofCommerceandIndustryand
othergovernmental(andsomeEmeslocalandnon-governmental)enEEesalsoconEnueto
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underminethespeedandeffecEvenessofthereformprocesswhileincreasingtransacEoncosts
formallyandinformally(throughvariousformsofextorEon)fortraders.Insomecasesthecustoms
borderpersonneldonotevenhavesufficientauthoritytomaintaintheuseofinfrastructure
designatedfortheirownuse.
Regardlessoftheseandothermonumentalchallenges,thecustomssystemhasseenamarked
improvementinitsoverallfuncEonalityandabilitytocollectandtransferrevenuestothe
Government.Customsrevenuesincreasedfrom$50millionin2004tomorethan$399millionin
2008,forexample,anincreaseofmorethan700%infiveyears.7For2011theesEmatedrevenue
fromcustomsoperaEonsisaroundonebilliondollarsUS.8Attheircurrentrates,customsrevenues
consEtutewelloverhalfofallGovernmentrevenueswhilethewaiEngEmefortrucksatmajor
bordercrossingshasdecreasedsignificantly.9Forexample,over90%oftrucksatTorkhamarecleared
inlessthan1.5hours,comparedto18hoursin2003.10Thebroadgoalsofthecustomsreform
programaretoincreaserevenue,standardizereportgeneraEon,increasespeedincargoprocessing,
andgeneratecompletedocumentaEon.(Seedetailsofspecificprogramsandprojectstomeetthese
andfutureobjecEvesinAppendix1andcustomsprocessdescripEonsandproceduresinAppendix2).
DespitethenumerousprogramsandsuccesseswidelypublicizedbyinternaEonaldonorsandthe
GovernmentinbuildingthecustomssysteminAfghanistan,theviewfromoutsidethecountryand
theadvicetothosewishingtodobusinessinAfghanistanisratherskepEcal,cauEonary,and
contradictorytothestatedaccomplishments:
AlthoughthereisafocusedAfghananddonorcountryefforttoimprovefaciliEesandpracEcesatthe
majorbordercrossingpoints,thecustomsregulaEonsandproceduresinAfghanistanareneither
transparentnorconsistent.CoordinaEonbetweencustomsandothergovernmentauthoriEesis
minimal,customsofficialsreceiveminimaltraining,andinfrastructureissEll2to3yearsfrombeing
fullyupgraded.Tradersfaceunclearproceduresatthebordersaswellassignificantdelays,extra-legal
duEes,andbureaucraEcobstrucEons.CorrupEonisasignificantproblem.11
Also,aUSGovernmentinvesEgaEonin2010reportsskepEcismbyalargenumberofsignificant
actorsabouttheprospectofexpecEngtheAfghanistanNaEonalPoliceorAfghanistanNaEonalArmytoplaycentralrolesincurbingcorrupEonintransitofgoodsfromborderentrypointstovarious
locaEonswithinthecountry.ThisskepEcismisbasedonconcernsaboutcapacity,competence,and
corrupEon.12TheunderlyingreasonforsuchskepEcismisnotweaknessesinorlackofprocedures
8
_____________________________________________________________________________________
7IDA2011.InternaEonalDevelopmentAssociaEonoftheWorldBank,availableat:h\p://web.worldbank.org/WBSIT/
XTRNAL/XTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:
73154,00.html
8Customskeyinformant,Kabul,May2011.
9ACD.2007.AfghanCustomsDepartment.Page9.
10IDA.2011.InternaEonalDevelopmentAssociaEon.
11DepartmentofState.2009.DoingBusiness.Chapter5.
12Tierney,J.F.2010.Warlord,Inc.:xtorEonandCorrupEonAlongtheUSSupplyChaininAfghanistan.(WashingtonDC:
UnitedStatesGovernment),page67.
http://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.html -
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butlackofenforcementcoupledwithactualorperceivedinsecurity.Arguably,themostformidable
insEtuEontocontendwithinthecustomsandnumerousothersystemsinAfghanistanisdeeply
rootedand,inmanycases,sophisEcatedformsofcorrupEoncompoundedbythepresence(at
borderentrypoints)ofaplethoraofothergovernmentalenEEeswithinsufficientlyclear,or
overlapping,mandates.
ItisworthpoinEngoutthatcorrupEoninAfghanistanhassomeofitsbeginningsinthetradiEonof
appreciaEnghelpthroughofferingsofpresentsand,morerecently,money.ThistradiEonhasnow
evolvedintoasophisEcatedandwidespreadsystemofextorEonmanifesEngitselfinallfacetsoflife
inAfghanistan,parEcularlyinareaswheretherearesignificantflowsofgoodsandpotenEalcash
suchascustoms.NochangeinproceduresalonecandealwithcorrupEoninitscurrentstate.
Procedurally,therearerulestobefollowedandtoolssuchasASYCUDAtobeuElized.Neitherisdone
adequatelyorsufficiently,however,duetoli\leincenEvetodosoandnoseriousoversightto
enforceadherence.ChangingorovercomingtheinformalinsEtuEonsofthetotalAfghaneconomy,
includingcorrupEon,aremuchgreaterchallengesthanintroducingorchangingtheformalones,e.g.,
rulesandregulaEons.
.KeyFindings
Reportedly,thenewandverymoderncustomssystemestablishedbytheGovernmentof
AfghanistanwithsignificantsupportfromtheinternaEonaldonorsisthesourceofenvyforallthe
neighboringcountries.However,despitethevariousfaciliEesprovidedbytheASYCUDAsystemfor
applyingthecorrectduty,generaEngreceipts,andbuildingaveryusefuldatabase,thereare
complaintsthatthepricingdepartmentsatborderpointsimposearbitrarycodesandpricestothe
goodsenteringthecountry.TradersalsocomplainthatASYCUDAsexpansivedatabaseisnotuElized
toassistthemwithtrackingmisplacedorlostdocumentaEonandinsteadtheyhavetoresorttothe
servicesofkomishenkarstoobtainduplicates.Theproblemsofthecustomssystemaremostlytodo
withwidespreadcorrupEon,lackofclarityamongthesystemsusersinrelaEontothefeescharged,
underuElizaEonoftheASYCUDAtechnology,andli\lerecoursefortheuserstoreportmaltreatment.
InconsistencyincustomsdutyallocaEonwasthemaincomplaintbymanyofthetraderswho
parEcipatedinthisresearch:
Dependingonthepointofentry,differentratesofdutyareappliedtothesameimports.Itisasifthe
headofcustomsistheself-appointedMinisterofFinance.InHeratthedutyforonetonofgoods
couldbe560AfghaniswhereasinMazaritcouldbe760.IfthisisonecountrywithoneMinistryof
Finance,thentheratesshouldbethesameatallentrypoints.13
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13FocusGroupDiscussion,Kabul,April2011.
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ThesenEmentsharedbymanyofthetradersinterviewedatthethreeborderpointswasthatthey
didnotmindpayingfeesonthecondiEonthattherewasconsistencyinthesystemandthelevels
chargedandthattheproceedswouldgototheGovernment,verifiedthroughproperlyprepared
documentaEon:
Wedontmindpayingfees,butwepreferittogothroughofficialchannelstotheGovernmentandnot
toanyonewhohasthepowertotakeitfromus.14
ThetradersinterviewedinKabulandatthethreeborderentrypointscitednumerousexamplesof
extorEonbyseniorandothercustomsofficialswhoallegedlydemandafeedependingonthesize
andtypeofimportedgoods.15Ifthetraderiswillingandabletopay,theconsignmentpasses
throughthesystemwithoutdelay.Ifnot,thegoodsareimpounded,someEmesforuptoamonth,at
thebordertowaittheirturntobeprocessed.InspecEonofthegoodsconsistsofoffloading
everythingfromthecontainertruck,inspecEngitwiththeriskoflossanddamage,uploadingit(also
withtheriskoflossanddamage),andthenallowingthegoodstopassthrough.16Smallerbribesare
requestedthroughouttheprocessofinspecEon.Accordingtoonetrader:
Thiswholesystemisunfair.WhendutyratesaredecidedthereisnoconsultaEonwiththetradersor
theirrepresentaEves.Noonecansolvethisproblembecausealotofthesecustomsofficershave
purchasedtheirjobsandareobligedtoactinacorruptmannertorecouptheircosts.17
Fortraderswhowishtominimizetheirdiscomfortandtogothroughthecustomsprocedures
expediEously,therearekomishenkars(brokersormiddlemen)whoare,allegedly,appointedbythe
seniorofficialsatcustomspoints.Typically,komishenkarschargebetween1,4001,800Afghanispertruck,notcounEngallothergratuityorbribemoniesthatthetradersareexpectedtopaythevarious
officialswhilethekomishenkarisgoingthroughtheprocess.Traderswhogothroughtheprocessare
expectedtopayaformalchargeof1,800AfghanisfortheT1Formandbetween200-300Afghanis
forthetashrihnameh(descripEondocument).Manytraderspayclosertoaround6,000Afghanisand
complainthattheycanonlyshowreceiptsforsomeofthecoststheyincurincomingthroughthe
customssystem.18AllallegaEonsaboutextorEonandbribeexpectancybycustomsandotherofficials
arevehementlydenied,however,byMoFofficials.19Theroleofkomishenkars,thoughiniEally
informal,wereformalizedinJune2011andevendocumentedintherevisedproceduresfor
obtainingcustomsclearance.(SeeAppendix2).
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14FocusGroupDiscussion,Kabul,April2011.
15Reportedly,thenormalbribefortrucksis$250forcarryingcement,$110forEmber,$100forpotatoes,and$90for
petroleumgas.SeeADB(2008),AfghanistansTradewithCARCNeighbours:videncefromSurveysofBorderCrossing
PointsinHairatanandSherKhanBandar.(Kabul:AsianDevelopmentBank).Conceivably,highvalueelectricand
electronicproductswouldincurhigherbribes.
16InterviewwithtradersatIslamQala,February2011.
17FocusGroupDiscussion,Kabul,April2011
18OnetraderatIslamQalaclaimedthathepaidanythingrangingfrom100to20,000Afghanisdependingonthetypeand
sizeofhiscargo.19ADB.2008.AfghanistansTrade.Theinterviewsheldwithofficialsinthecourseofthisstudyalsoconfirmthis.
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4.1Hairatan
ThetradersandotherkeyinformantsinterviewedatHairatanandinMazar-eSharifreportedpaying
informalfees(orbribes)ofupto5,000Afghanispercontainertrucktogetthroughthefirst
inspecEonpointsothatthecontentscanbevaluedandfeespayablecalculated.PassagethroughMazar-eSharifalsoinvolvesthepaymentofhaqulubor(rightofpassage)ofbetween1,800to2,000
Afghanis,chargedbythemunicipality.Ifatraderwishestopaylessincustomscharges,itisatthis
pointwherenegoEaEonsbeginaboutthevalueofthecargo.HighvaluecargosarerouEnely
undervaluedattradersrequesttominimizepayablecustomsfees.Theofficer(s)whoassistthe
tradersbyundervaluingthecontentsaregivenashareofthesavingsmadethroughcontentsbeing
undervalued.Accordingtoonetrader,
Onthissideoftheborder[inAfghanistan]wearerequestedtopaybribesbythecustomspeopleand
the[border]police,whoarejustlookingforanexcuse.venwhenwehavenoproblemswithour
paperwork,wearetoldthatsinceweareimporEngsomuchweshouldgivethemali\leastheir
share.20
Bribesarealsowillinglypaidbytraderswhowanttheircargomovedquicklythroughcustoms:
OnceIaminAfghanistan,IoffertopaybribesbecauseIknowthatIcanspeeduptheprocess,andget
mygoodstotheirdesEnaEonwithinoneortwodays.21
Incontrast,thereareveryfewproblemswithbriberyandlossofgoodswhilegoodstransitthrough
UzbekistanandTajikistanontheirwaytoHairatan.Alltraderswereadamantthatproblemsfor
shipmentsbeginfromthepointofentryintoAfghanistan.TheonlysituaEonwherethereisa
possibilityofbribepaymentoutsideofAfghanistaniswhentransitpaperworkisincompleteor
inadequatelyadministered.
4.2IslamQala
TradersinIslamQalareportvariousexcusesusedbyofficialstoextortbribesfromthetradersfor
amountsrangingfrom100to20,000ormoreAfghanis.22
ThetraderswhoimportvehiclesanddecidetodrivethemtoKabulforregistraEonareharassedbyofficialsfornothavingplatesdespitethefact
thatthedocumentaEonforthevehiclesisinorder.ThissituaEonisoenresolvedthroughthe
paymentofbribes.Tradersarecharged1,800AfghanisforobtainingtheT1Formand2-300Afghanis
forobtainingtashrihnameh.However,withvarioustypesofotherunofficialchargesandtheuseof
komishenkars,thetraderstypicallypayaround6,000AfghanistohavetheirimportaEonpaperwork
completed.
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20InterviewwithatraderinMazar-eSharif,February2011.
21InterviewwithatraderinHairatan,February2011.22InterviewswithtradersinIslamQala,February2011.
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TheroutefromHerattoKabulisparEcularlyunsafeand,reportedly,thereareofficialandunofficial
checkpointstocollectillegalrightofpassagefeesfromthetrucks.Unofficialrightofpassagefeesare
alsochargedoncargocomingfromIslamQalatoHerat.Asonetraderputit,
Ifyoutravel5kilometersawayfromIslamQalatowardHerat,youseeallthesepeoplestandingonthe
roadwiththeirshalwarchemiseclothingandaskingformoney.Theyhavenorighttodothis,only
powertoextortmoney.23
Someofthesecheckpointsevenissuetheirownreceiptstothedriverswhilemanydriversinsiston
payingandobtainingthereceiptstoinsurethemselvestherightofpassagethroughfurther
checkpointsorforwhentheyreturnonthesameroute.GoodsenteringintoAfghanistanthrough
ZaranjalsopayafeeattheDelaramT-juncEonwheretheTalibanhaveacheckpointandchargea
dutybasedonthenumberofEresonthetrucks.Theusualpriceis1,000AfghanisperEre.24A
numberofthetradersinterviewedexpressedawishforinsurancecoverfortheirgoodswhileen
routefromIslamQalatoKabul.
4.3Torkham
ThetradersinterviewedreportedonirregularapplicaEonofcustomsduty.Theypay16,500Afghanis,
whichincludesafeeforthekomishenkar,toobtainaT1Formtoimportgoodsand1,000Afghanisto
theprovincialgovernmentasdevelopmentfee.OncompleEonofthepaperworkthetradersare
expectedtogiveabout100Afghanistotheprocessingofficerasbakhshish(gratuity).ThemainobjecEonbythetradersusingTorkhamastheirentryportwasnotreceivingreceiptsorbeinggiven
inadequatedocumentaEonexplainingthechargesandthereasonsforthem.
InaddiEontoinconsistentdutybeingapplied,othercostsincurredbytradersincludea
developmentchargeinTorkham,imposedbytheGovernorsofficeforrightofpassagethroughthe
Jalalabadmunicipality,andinformalfeeschargedatthevariousentrypointstoKabul.nrouteto
Kabul,trucksareoenstoppedbythepoliceandaskedtopay,aspassagefee,theunofficial
cigare\eandsnuffmoneywhichrangesfrom30to200Afghanis.
ThereareanumberofsignificantissuesfacedbythetraderswhotransitthroughPakistanentering
AfghanistanviaTorkham,parEcularlyenroutefromtheportofKarachi.25Goodsthatremainin
KarachibecauseofinsufficientdocumentaEonorbecauseofhighbribessoughtbyPakistanicustoms
officials,havetopaystoragefees,ordemerge,whichsomeEmescanbeashighasoneto1.5
millionKaldars.Also,recentlytheGovernmentofPakistansetupagovernmentownedandoperated
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23InterviewwithatraderinHairatan,February2011.
24InterviewwithtradersinIslamQala(February2011)andwithacustomsofficialinKabul(June2011).
25Notethatnoneofthekeyinformants,interviewedforthisresearch,alludedtoproblemswithtransiEngtheirgoodsthroughUzbekistanorIran.
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transportaEoncompany,NLC,taskedwiththetransportaEonofintransitgoodsdesEnedfor
AfghanistanfromKarachi.TheAfghantradersarenolongerallowedtoarrangetheirownintransit
andarecompelledtouseNLC.ReportedlyNLCdoesnothavesufficienttruckstoaccommodatethe
highvolumeofintransitgoodsdesEnedforAfghanistan.Also,thetrainsusedfortransporEngthein
transitgoodscannotaccommodateheavyitemssuchascarsandotherheavyvehicles.Thisresultsin
increaseddelayinthemovementofimportsfromKarachitoTorkhamandpaymentofmulEple
storagefeecosts. 26
TheamountofimportedgoodsintoAfghanistan,parEcularlyofelectricalandelectronicgoods,far
exceedsthedomesEcdemand.ThereasonforthisisthelucraEveandinformalre-exportaEon
systeminoperaEonaroundTorkham,whichtakesadvantageofthehighduEeschargedonimported
goodsinPakistan.Significantvolumesofelectricalandelectronicgoods,clothes,DVDs,CDs,tea,and
drugsimportedintoAfghanistanthroughTorkhamarere-exportedbacktoPakistanthroughborder
villagessuchasGaroko,Durbaba,andShalmanandsoldatpremiumprices.27Theamountofillegally
importedgoodsintoAfghanistanisesEmatedat20%ofthetotal.Theentryportsforillegal
importaEonareLalpoora,Gowshta,Garoky,Kama,Chachobi,andAchin.28
4.4CommonChallenges
Gengthroughthecustomsisthefirstofaseriesofchallengesfacedbytraderswhothenhaveto
movetheirgoodstoKabul.FromallthreeborderpointstoKabultherearelayersofpolicecheckpointswho,reportedly,demandafeetoallowthetruckstoconEnueontoKabul.When
enteringKabul,aninformalfeeispaidtothetrafficpolicetogainpermissionfortransiEngheavy
loads.IffinesareimposedontruckdriverswhileinKabul,receiptsarenotalwaysprovided.29When
inKabul,thetrucksareimpoundedindesignatedstorageareasasameanstolessenthelevelof
trafficinthecity.Foreachnightofimpoundmentthetruckshavetopayaround250Afghaniseach,
whichamountstoasmallfortuneconsideringthataround3,0005,000trucksenterKabulevery
day.30ThetraderswhohavetheirownstoragefaciliEesarelegallynotallowedtousetheminsteadof
thedesignatedstorageareas.
InaddiEontothebribespayablebythetraders,tradersfaceothermajorchallenges.Asonekey
informantputit,
thereisnoinsurancesysteminourcountry.Thisisaseriousproblemforus[giventhesecurity
risks].AfghantradersarenotrealizingtheirfullpotenEalforanumberofveryimportantreasons.
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26InterviewswithtradersinTorkham(February2011).
27InterviewwithtradersandcustomsofficialsinTorkham(February2011)andinterviewwithcustomsofficialinKabul
(June2011).
28InterviewwithcustomsofficialsinTorkham(February2011).
29InterviewwithtradersinTorkham,February2011.30FocusGroupDiscussionparEcipant,Kabul,April2011.
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OutsideAfghanistantheyhavevisaproblemsanddifficultyinnegoEaEngwithforeigntradersbecause
we[Afghantraders]haveveryli\leexperienceofworkingininternaEonalmarketsandwedonthave
appropriateknowledgeandeducaEonabouttrade.Anotherissueistheinadequacyinhowthe
Governmentchargesitsvariousfees.Forexample,therearemulEplechargesimposedonmany
importedgoods.First,thereisachargeattheportofentryandthenattheendoftheyearthereis
anotherchargeimposedbytheMinistryofFinance[astax].Ourtradersarenotclearastowhytheyare
payingthesecharges.31
ThelossesincurredbythetraderswhentheirperishablesarespoiledduringretaliatoryinspecEonsby
customsofficersaresignificant.ThiscreatesanarEficialgrowthbarrierformanytraderswhoarerisk
averseandshyawayfromtradinginlargevolumesforfearofpayinghigherbribesorhavingtheir
goodsstolenatvariouspointsofthejourneyfromthebordertoKabul.Othertradersoptforsub-
qualityimportstominimizerisks.
AsignificantfactortobeconsideredinresolvingthehighlevelofcorrupEoninthecustomssystemis
theverylowsalariesofthecustomssystememployees.32Rumorsarerifeaboutcustomsjobsbeing
soldandexcessivecorrupEontakingholdasthemeanstoextortmoneyandpayforthedebtincurred
tobuyacustomsjob.venwhenallpaperworkisinorder,thetradersareaskedtopaysomething
sincetheyarecarryingsignificantamountsofcargoand,presumably,haveaccesstolotsofmoney.
Someofthecustomspersonnelinterviewedreportedthatitwasdifficultforhonestpersonnelto
remainhonestsincetheyweresurroundedbypeersandsuperiorswhoforcedthemtobecorrupt.Reportedlytheconsequenceofnotsuccumbingtopeerpressureisoendismissal.
5.Conclusion
Intechnicalterms,Afghanistansnewautomatedcustomssystem(ASYCUDA)istheenvyoftheregion.
However,despitenewfaciliEes,improvedinfrastructureanda\emptstobuildcapacityand
accountabilityamongcustomsofficials,thecustomssystemconEnuestoexhibitexceedinglyhigh
levelsofcorrupEon.WhilecorrupEoninAfghanistanmayhaveitsrootsinthetradiEonofoffering
monetarygratuiEesorinkindappreciaEoninexchangeforservices,thistradiEonhasevolvedintoa
sophisEcatedandwidespreadsystemofextorEonmanifestinalmostallfacetsoflife.ThesepracEces
areparEcularlyevidentwherethereisasignificantflowofgoodsandcash,asinthecustomssystem.
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31InterviewwithanofficialfromAfghanistanChamberofCommerceandIndustry.
32Thisispartofamuchlarger,naEonalissuewithlowwagesacEngasincenEvesforcorruptbehavior.Whilesimplyraising
salariesofallgovernmentemployeesbyafactorof5or10isnotarealisEcopEon,theissueremainsthataslongas
salariesremainattheircurrentlevels,thereisahighlikelihoodthattheywillconEnuetoactasamajorincenEvefortakingbribesorextorEon.
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Customsofficialscommonlytakeadvantageoftraders,demandingbribesofvaryingsizesin
exchangefortheperformanceofnearlyanyfuncEon.Customsemployeesreportthatevenwhen
theydonotwanttoparEcipateincorrupEonandextorEon,theyareforcedtodosounderpeer
pressureandduetofearofpersecuEonbytheircorruptcolleaguesandsuperiors.Asaresult,few
customsemployeesspeakoutagainstthecorruptpracEcesoftheircolleagues.33Thisstateofaffairs
hasanegaEveimpactontradeandstaterevenues,increasesrisksfortraders,andthushinders
economicgrowth.
Yet,tradersactasbothvicEmsandperpetratorsinthecurrentsystem.Tradersplayaninstrumental
roleinmaintainingastable,butillicitequilibriumwithcustomsofficials,basedonpaymentof
minimalfees(bythetraders)andreceiptofmaximumgratuiEes/bribes(bythecustomsofficials).
Thisequilibriumismaintainedthroughthesubversionofproceduralchangesintroducedsince2003
by,forexample,intenEonallymiscodinggoodsintheASYCUDAsystemtochargelowerduEes.The
mainlossescausedbythisextra-legalequilibriumareaccruedtothegovernment,whichfailsto
receiveduEesonimportedmerchandise.
DeterioraEngsecuritycondiEonsnotwithstanding,thevolumeoftradebetweenAfghanistanandits
neighbors,andthuscustomsrevenue,islikelytoincreaseinthecomingyears.InternaEonaldonors
arelikelytoconEnueprogrammingoncustomsreconstrucEon/reform.ffortsbytheGovernment
toenterintoregionaltradeagreementsandtojointheWorldTradeOrganizaEonarelikelyto
increasethepressuretoEghtenthecontrolsinthecustomssystemandrootoutcorrupEon.
RegionalintegraEonandrooEngoutcorrupEonare,arguably,inEmatelyinterrelatedbutrealizingthemisnotalinearprocess.LesscorrupEonislikelytoincreasethechancesofregionalintegraEon
andWTOaccessionwhileregionalintegraEonislikelytobearpressuretorootoutcorrupEon.From
apolicy/intervenEonperspecEve,bothobjecEvesshouldbepursuedsimultaneously.
GiventhepotenEalofthecustomssystemasareliableandsustainablerevenuesource,further
improvementsinthecustomssystemarelikelytobeiniEatedandimplementedbytheGovernment
ofAfghanistanandtheinternaEonaldonors.Asusersofthesystem,thetradersandvariousother
privatesectorenEEeshaveli\leornoincenEvetoadvocatefortransparency,oversight,or
accountabilitysincetheirbordertransacEonsoccurthroughastableequilibriummaintainedbetweencorruptcustomsofficialsandcorruptimporEngtraders.AtthesameEme,thegovernment
andtheinternaEonaldonorsarenotinthestrongestposiEontoeffectchangeintheimmediate
term.StructuralreformofthecustomssystemtorootoutcorrupEonrequiresinputfromthe
governmentandthedonorsontheonehandandinputfromthebusinesscommunityontheother.
Breakingthecurrentstableequilibriumtoestablishanew,morelegiEmate,equilibriumwillrequire
simultaneousintervenEonfromthetop,bythegovernmentandinternaEonaldonors,andfroma
grassrootslevelbythebusinesscommunity.Inthefirstinstance,topdownreformshouldbe
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33InterviewswithcustomsofficialsinTorkham,February2011.
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a\emptedthroughtheGovernmentanditsinterveningagenciessuchastheHighOfficeofOversight
andAnEcorrupEonandtheA\orneyGeneralOffice.ForHOOtosucceedwhereGIAAfailed,much
moreauthorityandresourceswillberequiredtoenableHOOtocontend,contest,andchallengethe
currentstatusquoincustomsoperaEons.Similarly,fortheA\orneyGeneralOfficetoplayarolein
rooEngoutcorrupEoninthecustomssystem,seriousthoughtmustbegiventohowtheOfficesrole
isbeingfulfilledcurrently,howsuccessfulithasbeeninbringingtoprosecuEoncorruptofficialsof
thecustomsDepartment,andwhatcanbedonetostrengthenA\orneyGeneralsimportant
funcEon.
GrassrootsintervenEonsaremuchhardertoiniEateandorganizebutextremelynecessaryin
fundamentalreform.OnecannothopeorexpectthatonedayAfghantraderswill,ontheirown,
decideagainstbeingpartytocorrupEoninthecustomssystemtheyhavenoincenEvetodoso.
ThetaskofiniEaEonthusmustfallonintermediaryorganizaEonsandenEEeswithresourcesandan
interestinandmandateforprivatesectordevelopment.SuchorganizaEonsincludeHarakat,which
hasamandatetopromoteprivatesectoracEvityinAfghanistanandalsohasadequateresourcesto
iniEateandfacilitateaseriesofdialoguesinvolvingotherintermediaryorganizaEonsandenEEes
suchasACCI,AISA,andetehadias(guildsortradeassociaEons).34
6.Recommenda4ons
ChangesininformalinsEtuEonssuchascorrupEontakealongEmetobecomeestablished,andwill
requireallmannerofintervenEon,incenEve,anddisincenEvewhichmaybemonetaryandnon-
monetary,proceduralandregulatoryand,mostimportantly,innovaEveandinteracEvetomaximize
learningbydoing.Thereisnoimmediateone-EmesoluEontothebo\lenecksinthecustoms
system.ThestepsrequiredtomoveawayfromcurrentpracEcesinvolvesproceduralrevisions(short
term),improvedoversightmechanismsandimplementaEon(mediumterm),andashiinthevalues
thatcurrentlysupportcorrupEonamongcustomsofficialsandusersthroughawarenessraising,
educaEon,andredefinedincenEvesanddisincenEves(longterm).Suchchangescannotbeexpected
tocomeonlyfromthetopdown,however.CurbingbriberyattheoperaEonallevelrequires
dedicatedenforcementmechanismsandadministraEvesancEonssupportedatthegrassrootslevel.
InaddiEon,suchmechanismsneedtobeextendedandmaintainedintheprovinces.
ReformsmustalsoaddresstheneedsandinterestsoftheactorsmostaffectedbycustomspracEces
customsofficialsandthetraders.IncenEvestoiniEatebehavioralchangeamongcorruptofficials
shouldincludesalariesthatsurpassbasicsubsistence.Ifthisisnotimmediatelypossibleor
sustainable,innovaEveincenEvesarerequiredtobringcorrupEonundercontrol.Forexample,one
customsofficialsuggestedthatwhencontrabandisintercepted,upto20%ofthevalueoftheseized
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34ForthefullmandateandoperaEonsofHarakat,see:h\p://www.harakat.af/index.php?page=en_About+Us
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goodsshouldbegivenasrewardtotheemployeeortheteamresponsibleforthecatch.Thistypeof
incenEveprovidesamerit-basedbonustopoorlypaidcustomsofficialswhilepublicdisbursementis
likelytobenoEcedbycoworkers.OtheriniEaEvestoimprovecapacityandaccountabilitymustbe
plannedwithmoreforethoughtsuchaslegiEmizingtheroleofkomishenkarsandpunginplace,
whennecessary,internaEonaladvisorswiththerequisiteexperience.35
AtthesameEme,incenEvesmustbedesignedtotargettraders,withanunderstandingthatmany
tradersalsobenefitfromcorrupEon.Withthisinmind,dutyratesshouldbesetthrougha
consultaEveprocesstoencourageimporterstousethesystemratherthansubvertit.Tradersmust
beabletoeasilyandconfidenEallyreportinstancesofcorrupEon,andtoimmediatelyseetheimpact
oftheirefforts.Mechanismsfortheappealofcustoms-relateddecisionsshouldberelocatedtothe
borderpointssincerequiringtraderstotaketheirclaimstotheCustomsAppealBoardinKabulonly
encouragespayingbribesatborderentrypointstominimizetransacEoncosts.
FailuretoaddressthemulEplelayersofrequiredchangeinasystemaEcmannerrunstheriskof
underminingstaterevenues,regionalandinternaEonaleconomicintegraEon,andislikelytofurther
weakenthelegiEmacyofthecustomssystembydiscouraginglegiEmateinvestorsandrewarding
thoseengagedinsubverEngthesystem.Thenetresultofthesetrajectorieswillbetodeprive
AfghanistanofdesperatelyneededlegiEmatetradeacEvity,governmentrevenue,anddirect
investmentbynaEonalandinternaEonalactors.AddiEonally,changesofrulesandregulaEonswill
notbehelpfulunlesstheissuesofenforcementaresolvedandtheperpetuaEonofthecultureof
offeringgratuiEestogetthingsdoneismanagedwithinacceptablelimits.Thatsaid,muchcouldbeaccomplishedthroughreforminwagesandotherformsofremuneraEon,increasedandtransparent
oversight,and,mostimportantly,engagementandlearning.
Specifically,theGovernmentofAfghanistanandinternaEonaldonorsshouldconsiderimplemenEng
thefollowingmeasuresintheireffortstoreformthecustomssystem:
- ConEnuethebuildingandmodernizaEonofcustomsinfrastructure.Atmajorpointsofentry,i.e.,
Hairatan,IslamQala,andTorkham,Afghanistanscustomssystemisoneofthemosta\endedto
andmodernizedinSouth/CentralAsiaandtheMiddleast.ffortstomaintainthecurrentfuncEonsandincreaseadherencetotheproceduresthroughmoreeffecEveenforcementand
oversightwillneedtobeintensified,bearinginmindthatinsEtuEonalizaEonofthemany
changesplannedforthecustomssystemislikelytotakemanyyears.
- IniEateaprocessofdialoguetoinvolvetheMinistryofFinance,HighOfficeofOversight,Ministry
17
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35OnecustomsofficialcomplainedthatappoinEngyoungfemaleuropeansasadvisorstocustomsofficialswas
counterproducEve,parEcularlyinsomeofthemoreconservaEveborderregions.ThesuggesEonwastoappointoldermaleswithregionalexperiencetomaximizeimpactonthelocalcustomsofficials.
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ofCommerceandIndustry,representaEvesoftradersandotherprivatesectorrepresentaEve,
andotherrelevantparEesonhowtoconEnueeffortstoimplement/enforcecustomslawand
relatedregulaEonsandproceduresanddevisewaysofminimizingarbitrarinessinthepracEces
ofcustomspersonnel.IntermediaryorganizaEons,suchasHarakat,arewellposiEonedtoiniEate
suchadialogue.TheoutcomesfromthisdialogueshouldincludeintervenEonstoincreasethe
integrity,independence,andauthorityofthecustomssysteminrelaEontoothergovernmental
agenciesacEveinborderareas.
- Maintaineffortstoimproveinfrastructure,providetrainingandcapacityexchange,raisesalaries
andotherformsofremuneraEon,andinsEtuteafuncEoningoversightmechanismtoinclude
monitoring,evaluaEon,andperiodicaudits.
- FormallycerEfykomishenkarsaslegiEmateactorsinthecustomsprocesswhiletakingstepsto
ensurethattheyreportonthefeeschargedandtaxespaidonearnedcommissions.
- ConEnuetobuildcooperaEonandharmonizaEonthroughcustomstreaEes,forexample,with
neighboringcountries.Forthistohappen,andforAfghanistantomaximizebenefitsfromsuch
associaEons,Afghanistanneedstoaddresstheremainingproblemsinitscustomssystem(mostly
relatedtocorrupEon)simultaneouslywithstrengtheningEeswithregionalandinternaEonal
partners.
- ConductfurtherresearchtounderstandthebackendofcustomsoperaEons.ThescopeofthisresearchwaslimitedtoanexaminaEonofthefrontendofcustomsoperaEons,focusingonhow
usersandofficialsprocessgoodsthroughthesystem.Tofurtherbenefitthedesignand
implementaEonofreformsinthecustomssystemitwillbenecessarytoinvesEgate,forexample,
howcollectedduEesaretransferredfromtheborderintoGovernmentrevenuestreams,towhat
usecollectedrevenuesareput,andhowtheseaspectsofthesystemaffectdaytodayoperaEons
attheborderpointofentry.
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46See,forexample,Box1and2regardingICCstandardsforbusinessesandnaEonalgovernments,aswellasAppendix1fortheGlobalCompacts10thPrinciple.
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Bibliography
ACD(2007).AfghancustomsDepartment:AFiveYearStrategicPlan(2007-12).(Kabul:Government
ofAfghanistan).
ADB(2008),AfghanistansTradewithCARCNeighbours:videncefromSurveysofBorderCrossing
PointsinHairatanandSherKhanBandar.(Kabul:AsianDevelopmentBank).
AltaiConsulEng(2007).ChallengesPresentedbytheLegalandRegulatoryFrameworkGoverning
PrivateSector,For-profitAcEvityBackgroundpaperpreparedforthenabling
nvironmentConference,organizedbyAgaKhanDevelopmentNetworkinAugust2007,
Kabul,Afghanistan.
DepartmentofState(2009).DoingBusinessinAfghanistan:2009CountryCommercialGuideforU.S.
Companies.(WashingtonDC:UnitedStatesGovernment).
GovernmentofAfghanistan(2007).AfghanistancustomsDepartment(ACD):AFiveYearStrategic
Plan(2007-2012),(Kabul:MinistryofFinance,GovernmentofAfghanistan).
IDA(2011).InternaEonalDevelopmentAssociaEonoftheWorldBank,availableat:h\p://
web.worldbank.org/WBSIT/XTRNAL/XTABOUTUS/IDA/0,,contentMDK:
22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.html
IntegrityWatchAfghanistan,AfghanPercepEonsandxperiencesofCorrupEon:ANaEonalSurvey
2010.(Kabul:IntegrityWatchAfghanistan).
Tierney,J.F.(2010).Warlord,Inc.:xtorEonandCorrupEonAlongtheUSSupplyChainin
Afghanistan.(WashingtonDC:UnitedStatesGovernment).
19
http://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.htmlhttp://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/IDA/0,,contentMDK:22311336~menuPK:4752068~pagePK:51236175~piPK:437394~theSitePK:73154,00.html -
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Appendix1:CustomsReformProgramsandProjects
Program Projects
Program1Automa,on Project1:ImplementaonofTransitandDeclaraonProcessingatMajorcustomsStaonsProject2:FullImplementaonofallASYCUDAModules
Project3:TrainingforOperaons
Project4:MISandotherRevenueReporngSystemsofASYCUDA
Project5:FullInternaonalizaon
Project6:ProcurementofNecessaryASYCUDAITEquipment
Project7:Cross-borderDataExchange
Project8:ACDsICTMasterPlan
Project9:EstablishmentofRiskManagementUnit
Program2
Legaliza,onand
Procedures
Project1:LegislaveReform
Project2:FinalizingSub-legislaon
Project3:ProceduresforSupporngAutomaon
Project4:CheckingRevenueLeakagesandTaxFraud
Project5:ReformofInternalAuditDirectorate
Project6:FormulaonofEffecveValuaonDatabase
Project7:ImplementaonofValuaonBestPraccesProject8:TransitCorridorsImprovement
Project9:DevelopmentofWarehousingProceduresandSystem
Project10:customsBrokersProgram
Project11:ReformPolicyandCoordinaon
Program3
Enforcement
andVoluntary
Compliance
Project1:PrevenveandEnforcementWingReforms
Project2:An-smugglingReformswithaFocusonContrabands
Project3:InvesgaonsandProsecuonWing
Project4:BorderlineSurveillance
Project5:EstablishmentofaModernIntelligenceUnit
Program4
HumanResource
and
Organiza,on
Development
Project1:SalarySystemReform
Project2:Incenves/Bonuses/RewardsReform
Project3:HumanResourcesPolicyReform
Project4:InternalAffairsandIntegrity
Project5:EstablishmentofNewSupportUnits
Project6:TrainingPolicyandTrainingScheduleProject7:ModerncustomsTrainingInstute
Project8:TraintheTrainers
Project9:RefresherandSpecializedTrainingCourses
Project10:ForeignTrainingProgram
Project11:HumanResourcesFunding
Project12:HumanCapitalDevelopmentManagementCapacityBuilding
Program5
Infrastructure
andEquipment
Project1:ConstruconorDevelopmentofICDsandRegionalHeadquarters
Project2:ConstruconorDevelopmentofBorderStaonsandcustomsTrainingInstute
Project3:EstablishmentofInventoryManagementandMaintenanceUnit
Project4:EstablishmentofInfrastructureManagementUnit
Project5:EstablishmentofStructureforCargoHandling
Project6:SurveillanceEquipment
Program6
LegalReform
Project1:EstablishmentofLegal/LigaonSupportOffice
Project2:EstablishmentofSupportAppealsandArbitraonUnit
Program7
Business
Partnership
Project1:HelpLineandMediaCoordinaonUnitatACDHeadquarters
Project2:WebsiteDevelopment
Project3:EstablishmentofanOmbudsmanProgramandIncreasedCapacityofConsultaveCouncil(withTrade)
Project4:EstablishmentofaHotLineatACDHeadquarters
Source:Afghani stansCustomsDepartment(2007).
20
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Appendix2:CustomsClearanceProcedures(inEnglishandDari)
Source:Customsofficials
21
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Source:Customsofficials