Customs administration, only way to go

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The history of customs administration dates back to centuries ago, when the mode of trade was in barter form. Collection of tributes from people who want to engage in trading activities was commonplace. Since then, customs, the agency responsible for controlling the flow of goods in and out of a country, have been in place.

For the Philippines, our customs history has been influenced by the Spanish and American regimes. The creation of the Commonwealth government and the establishment of the Republic gave the country an opportunity to tailor-fit the customs administration to what suits us best.

As an agency in charge of the efficient flow of goods, a customs bureau is an integral part of doing business and of nation building. Tariffs collected from duties are used by the government to better its services to the people, by way of social services, building new roads and other infrastructure.

However, due to some externalities, inefficiencies in customs administration become inevitable. But, for how long?

Recent developments

Corruption inside customs bureaus is nothing new. It is no walk in the park to administer the flow of goods, to calculate every duty even for miniscule items, track the movements of imported and exported items, especially if these are done without a formidable system. Human intervention can be inefficient and susceptible to misconduct.

Millions of eschewed revenues due to ineffective valuation and collection have hurt our economy, especially businesses dutifully paying the tariffs they ought to pay. In achieving revenue targets, there is still much to be attained.

What needs to be done?

It is time for the Bureau of Customs (BoC) to explore artificial intelligence and to go digital. In today’s highly digitalized economic landscape, it is fitting for the BoC, being an integral part of the country’s revenue-making activities, to explore the benefits of having limited human interventions and go digital once and for all.

Easier said than done, but if we do it now, it’s all systems go for the Philippines to achieve efficiency in customs administration.

This can be done in the following fronts: First, application of a software will eliminate inefficiencies. We have to bank on the beauty of software to put in place a system that will work best to eliminate loopholes. The use of cloud service is also significant to share the information seamlessly to relevant agencies, maintaining transparency and check and balance.

Two, putting up a road network application, where each category is color coded and traced and mapped-up, will help monitor the flow of goods across borders. Also, this prevents the “swings” and smuggling of goods to and from bonded warehouses.

Three, barcoding must be required to further ensure the traceability, authenticity and origin of the goods. Specific systems are in place by GS1, duly adopted by Asia-Pacific Economic Cooperation and now being considered for Association of Southeast Asian Nations by its APEC Business Advisory Council. All that is needed is to coordinate and adopt established norms and use the tools available.

Four, artificial intelligence and X-rays must be established. Over a million-and-one images can be scanned, including powdery products. The utilization of such innovations will prevent technical smuggling and likewise ease congestion to a large extent as the process is a breeze.

Five, software for inward forward manifest to categorize commodities will also help.
Six, subscription to pricing valuation can be monitored in real time.

Lastly, that the registration and accreditation of importers and exporters be outsourced to a business group with nationwide reach. The registration and accreditation of importers and exporters will ensure that they are affirmed to be exercising good business conduct. More importantly, the elimination of identity theft from among consignees and legitimate importers can be assured.

What’s next?

Inefficiencies, in any organization, must be targeted with real solutions. If we want the Philippines to become a flourishing trade and investment hub in the region, we must identify the causes which pull our businessmen and entrepreneurs, especially small and medium enterprises, steps behind.

Making use of the technology and innovations available to us is a big leap for the history of our customs administration. We cannot be scared by the use of technology; it may take some getting used to at first, but the fruits are sweeter. We have to consistently reach our revenue targets to fuel the government services that will be of help to the Filipinos. We also have to put in mind the businessmen and entrepreneurs, working day in and day out, who provide job opportunities and employment for the country. They are seriously hurt when inefficiencies happen because of dated systems and ways. We have to step up, double time, so that we will be able to catch up to the countless times that we have lagged behind our neighbors and the world.

It is imperative that government sit down with chambers of commerce, the PCCI and ICCP, listen and seriously consult with them in crafting systems that will ensure that globally accepted systems are in place and universally accepted best practices are observed in customs administration.

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