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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
Integrated Single Window e-Logistics
•• 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:
Integrated Single Window e-Logistics
Exporter
Customs 3PL/ Domestic Carriers
Sea Ports & International
Carriers
Bank/ Insurance
Freight Forwarders
ShippingInstructions
Schedule/Status
Statuses/Changes
Declaration/Permits
Rates &Schedules
Electroniccommunication
DraftBL
OBL
ShippingInstructions
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
Integrated Single Window e-Logistics
•• 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
Integrated Single Window e-Logistics
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
Single Window Inter-operability
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
Single Window Inter-operability
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
Single Window Inter-operability
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
Single Window Inter-operability
•• 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
Single Window Inter-operability