.AidAid for SAFE tradefor SAFE tradeWCO SAFE WCO SAFE FrameworkFramework of Standards of Standards to to SecureSecure and and FacilitateFacilitate tradetrade

Lars Karlsson, Director, WCO Lars Karlsson, Director, WCO WorldBankWorldBank -- CustomsCustoms Reform and Reform and ModernizationModernization SeminarSeminar

Washington D.C. December 2006Washington D.C. December 2006

World World CustomsCustoms OrganizationOrganizationRue De Marche 30, Rue De Marche 30, BrusselsBrussels BelgiumBelgium

World World CustomsCustoms OrganizationOrganization (WCO) (WCO) factsfacts•• FoundedFounded 19521952

•• International International organizationorganization for for CustomsCustoms mattersmatters

•• 170 170 MemberMember countriescountries

•• Council, Policy Council, Policy CommitteeCommittee, , FiveFive TechnicalTechnical CommittesCommittes

•• SecretarySecretary--GeneralGeneral and and SecretariatSecretariat in in BrusselsBrussels, , BelgiumBelgium

•• Three Three SecretariatSecretariat DirectoratesDirectorates

ComplianceCompliance & & FacilitationFacilitation

Tariff & Trade Tariff & Trade AffairsAffairs

CapacityCapacity Building (1Building (1st st JanuaryJanuary 2006)2006)

•• Regional Regional structurestructure

Challanges?

ThereThere are are hugehuge challenges aheadchallenges ahead……

Be creative…

To To thinkthink new, out of the new, out of the boxbox……andand not not holdhold on to old on to old routinesroutines. .

Finding a solution…

ThereThere is is alwaysalways a solutiona solution……

……for for everyevery problem !problem !

Is it possible?

Is it Is it possiblepossible to to havehave oneoneglobal standard to global standard to securesecure the the

international international supplysupply chainchain and at and at the same time the same time facilitatefacilitate trade ?trade ?

What did we do?

What is SAFE…?

What is SAFE Framework of Standards ?

•• The SAFE Framework of Standards is a Customs The SAFE Framework of Standards is a Customs and trade processes platform, that covers all core and trade processes platform, that covers all core elements of Customs business, including Trade elements of Customs business, including Trade Facilitation (rev. Kyoto Convention), efficient Facilitation (rev. Kyoto Convention), efficient Revenue collection, Security, Integrity and Good Revenue collection, Security, Integrity and Good Governance. Governance.

SAFE components…

SAFE Framework of Standards • Twin Pillars

– Pillar 1, Customs-to-Customs network arrangements

– Pillar 2, Customs-to-Business partnerships

• 17 standards (11+6)

• The SAFE Framework of Standards is a comprehensive instrument that covers all areas of Customs controls and incorporates modern Customs principles

4 key principles

Four core elements

1. Advance electronic manifest information 2. Common risk-management approach;

27 Key data elements3. Inspection of high-risk cargo at port of origin;

export controls (non-intrusive)4. Enhanced trade facilitation for legitimate

trade; Authorized Economic Operator (AEO) concept

What is the AEO concept?

• Three parts– AEO definition (facilitation & security)– Validation & Accreditation– Mutual recognition

• Other issues– Authorized Service Providers– Authorized Secure Supply Chains– Both financial and security status

What is the AEO standard ?

How was SAFE developed?

• Formed by 2004 Council Resolution

• Recognized need to establish Standards based on work of a Task Force and other initiatives

• Membership of Directors General representing all WCO Customs Regions (12 Members)

• Six meetings held thus far in June & November 2004, April & November 2005 and April and October 2006

• Mandate for another year at Council 2006

The WCO Membership

High-Level Strategic Group (HLSG)

We can not do it on our own…

WeWe are all are all swimmingswimming in the same waterin the same water……..

PSCG

Private Sector Consultative Group (PSCG)

• 30 participants from all around the world • 17 companies and 13 trade organizations

What organizations?

AAEI American Association of Exporters & ImportersBARLOWORLD Logistics AfricaBASC Business Alliance for Secure CommerceBOEING The Boeing CompanyBPCarrefourCOSCO China Ocean Shipping (Group) CompanyFEDEXGM General MotorsGEA Global Express AssociationHUTCHISON Port Holdings Ltd.IAPH International Association of Ports and HarborsIATA International Air Transport AssociationIBMICC International Chamber of Commerce

ICS International Chamber of ShippingIFCBA International Federation of Customs Brokers AssociationsIRU International Road Transport UnionJMCTI Japan Machinery Center for Trade and InvestmentLIMITED BRANDS Inc.Maersk SealandMICROSOFT CorporationMoscow International Business AssociationNissanPHILIPS InternationalP&G Procter & GambleSiemensSITPRO Simplification of International Trade Procedures BoardTHALESWSC World Shipping Council

How to implement the new customs platform

The WCO Columbus The WCO Columbus ProgrammeProgramme-- AidAid for SAFE Trade for SAFE Trade --

AimAim::CustomsCustoms Reform and Reform and ModernizationModernizationthroughthrough full full implementationimplementation of the of the

WCO SAFE WCO SAFE FrameworkFramework of Standardsof Standards

What is Columbus?

A A CapacityCapacity Building Building programmeprogramme in in threethree phasesphases: :

•• PhasePhase One One –– NeedsNeeds assessmentassessment

NeedsNeeds assessmentassessment of present situation, gap of present situation, gap analysisanalysis to full to full implementationimplementation and and wayway forwardforward

•• PhasePhase TwoTwo -- ImplementationImplementation

Action Action planningplanning, , costcost--benefitbenefit, business , business casecase, , match match makingmaking with with donorsdonors, pilot activity & , pilot activity & implementationimplementation

•• PhasePhase Three Three -- MonitoringMonitoring

Monitoring and Monitoring and evaluationevaluation

Status?

WeWe are are makingmaking progress in all progress in all threethreephasesphases of the Columbus of the Columbus programmeprogramme

Results so far…

Columbus Columbus PhasePhase II

•• 140 140 countriescountries committedcommitted to SAFE to SAFE FoSFoS

•• 45 45 diagnosticdiagnostic missions missions donedone so farso far

•• 54 54 beforebefore the end of 2006the end of 2006

•• 101 101 beforebefore the Council, June 2007 (all)the Council, June 2007 (all)

Phase I countries

The WCO Columbus The WCO Columbus ProgrammeProgramme-- AidAid for SAFE trade for SAFE trade --

Angola, Bahrain, Bermuda, Bolivia, Brazil, Burkina Angola, Bahrain, Bermuda, Bolivia, Brazil, Burkina FasoFaso, , CambodiaCambodia, , CameroonCameroon, China, , China, DominicanDominicanRepublicRepublic, , EthopiaEthopia, Gabon, Ghana, Guatemala, , Gabon, Ghana, Guatemala, IndiaIndia, , Jordan, Jordan, KazakhstanKazakhstan, Kenya, Kuwait, , Kenya, Kuwait, KyrgyzstanKyrgyzstan, , Lesotho, Lesotho, MadagascarMadagascar, , MaldivesMaldives, , MaroccoMarocco, Mexico, , Mexico, Mauritius, Moldova, Mauritius, Moldova, MongoliaMongolia, , MozambiqueMozambique, , Namibia, Nigeria, Panama, Peru, Namibia, Nigeria, Panama, Peru, Philippines, Philippines, Rwanda, Saint Lucia, Senegal, Rwanda, Saint Lucia, Senegal, SerbiaSerbia, Sierra Leone, , Sierra Leone, South Africa, Swaziland, Tanzania, South Africa, Swaziland, Tanzania, UkraineUkraine, Uganda , Uganda and Vietnam. and Vietnam.

Phase II

+ 20 + 20 MembersMembers in in PhasePhase II II ””WeWe havehave movedmoved from from needsneeds assessmentassessment intointo actionaction””

Phase II activities

WCO WCO PhasePhase II II activitiesactivitiesExamplesExamples

•• Action Action PlanningPlanning PhasePhase II MissionsII Missions

•• Action Plan Action Plan WorkShopsWorkShops

•• CompendiumCompendium of of ImplementationImplementation toolstools

•• SAFE SAFE SeminarsSeminars

•• 16 16 DiagnosticDiagnostic FaciltatorsFaciltators WorkShopsWorkShops

•• MoreMore thanthan 350 350 CapacityCapacity Building ExpertsBuilding Experts

•• MoreMore thanthan 100 100 accreditedaccredited diagnosticdiagnostic faciltatorsfaciltators

•• 4 4 TrainTrain--thethe--trainertrainer WorkShopsWorkShops

Phase II strategy

The The strategystrategy for for PhasePhase II II -- ImplementationImplementation

•• SupplySupply supportingsupporting toolstools

•• GiveGive operationaloperational support for support for planningplanning

•• Pilots and Pilots and implementationimplementation projectsprojects

•• DonorDonor solution solution matchmakingmatchmaking

•• Champions and best Champions and best practicepractice solutionssolutions

Taking off

NowNow wewe are are reallyreally takingtaking offoff……toto new new hightshights !!

Phase III

PhasePhase III III –– Monitoring Monitoring +100 +100 countriescountries

””WeWe monitor the progressmonitor the progress””

Lessons learned

LessonsLessons learnedlearned..

ExamplesExamples

•• Risk management Risk management insteadinstead of risk of risk analysisanalysis

•• Review and Review and furtherfurther developdevelop risk risk indicatorsindicators

•• ICT ICT implementedimplemented, , butbut not not usedused

•• Lack of key Lack of key competencescompetences neededneeded for for changechange managementmanagement

•• NeedNeed for for moremore dayday--toto--dayday cooperationcooperation with tradewith trade

•• PoliticalPolitical willwill to to changechange and and modernizemodernize

Funding

DonorDonor ActivitiesActivities

Phase II support

WeWe nownow havehave the first the first agreementsagreements for for outsideoutsideinstitutionalinstitutional support for Columbus support for Columbus PhasePhase II II

……butbut wewe needneed moremore..

Other CB activities

ExamplesExamples

•• IntegrityIntegrity programmeprogramme

•• Regional Regional CapacityCapacity Building plans and Building plans and activitiesactivities

•• Regional Regional structurestructure

•• Development and Development and implementationimplementation of of ee--learninglearning

•• Research and Research and developmentdevelopment programmeprogramme with a with a networknetwork of of UniversitiesUniversities (PICARD (PICARD programmeprogramme))

OtherOther WCO WCO CapacityCapacity Building Building projectsprojects..

Partnerships

WeWe wantwant coco--operationoperation !!

The answer to the question

Is it Is it possiblepossible to to havehave oneoneglobal standard to global standard to securesecure the the

international international supplysupply chainchain and at and at the same time the same time facilitatefacilitate trade ?trade ?

Conclusion

ConclusionConclusion..””WeWe willwill continuecontinue to to deliverdeliver resultsresults””

Some final words

”I never wear a watch, because I alwaysknow it is now, and now is the time to do it”

Steve Mariucci

ThankThank you for your attentionyou for your attentionQuestionsQuestions??