BoC-China MRA: A step forward

The principal stakeholders of the security chain are assured of the speedy processing and seamless movement of their goods by cutting through bureaucratic and outmoded red tape.

A much-needed boost and a welcome addition to the handbook of best practices regarding the conduct of customs administration procedures the world over, the event never made it to the top news and was hardly noticed by the public.

Amid the flurry of news items on investment pledges and commitments made by potential foreign investors following President Ferdinand Marcos Jr.’s lightning visits to a succession of countries in the past few months, the Chief Executive’s three-day visit to China from 3 to 5 January was heralded as a “quick but productive visit.”

For one thing, as the President gleefully reported, the Beijing trip netted around $22 billion worth of investment pledges from the host country involving renewable energy, electric vehicle and mineral processing, and agribusiness.

During his five state visits made in 2022 to Singapore, Indonesia, Cambodia, Thailand, and the United States, around P23.6 billion in pledges were snagged by the country, according to the Department of Trade and Industry.

In an earlier report, the Office of the President said 14 bilateral agreements were signed by the Philippine and Chinese governments in the first week of January, entailing areas ranging from tourism, infrastructure and maritime security.

The advantages of foreign investments have long been proclaimed beneficial in generating more local jobs, increasing their purchasing power, stimulating economic growth, and helping in technology transfer from rich, developed countries to emerging or developing economies like the Philippines.

However, one similar undertaking was buried beneath the barrage of glowing press releases announcing the impressive commitments. Little or no mention was made of a new agreement seen as an essential change that would significantly improve the delivery of services at the Bureau of Customs.

I should know because I was part of that event as a signatory — along with my counterpart, the Chinese Minister of Customs Yu Jianhu — to the Mutual Recognition Agreement or MRA between the BoC and the General Administration of Customs of the People’s Republic of China on the Authorized Economic Operator Program. President Marcos for the Republic of the Philippines and President Xi Jinping on behalf of the People’s Republic of China witnessed the signing of the agreement.

The AEO Program is a partnership pursued globally by customs administrations to secure and facilitate trade by providing incentives to traders working jointly with customs administrations to improve supply chain security.

As a platform for the AEO program, MRA benefits include a higher level of facilitation during cargo clearance, domestic and overseas; priority treatment if the cargo has been selected for inspection; and expedited customs cargo clearance in the event of trade disruption. As such, AEO companies would thus enjoy cost savings due to better predictability of cargo movement.

Under the MRA, Level 2 Certified AEO members accredited by the BoC exporting to China will be extended trade facilitation benefits. Exporters to the Philippines accredited as Advanced Certified Enterprises under the measures of the Enterprise Credit Management Programme of the GACC will also be afforded trade facilitation benefits by the BoC.

Through proper coordination, the principal stakeholders of the security chain are assured of the speedy processing and seamless movement of their goods by cutting through bureaucratic and outmoded red tape, resulting in many improved and secure services.

Those who will benefit from the agreement include not only importers or exporters but the related workforce as customs brokers, logistics providers, and terminal and warehouse operators who will find the new terms easier and more convenient.

The MRAs serve as a platform for AEO programs to provide additional benefits to their members, like doing away with a lot of paperwork while giving priority and speedy cargo clearance previously inspected, which is a cost-cutting measure.

Certified AEO members accredited by the BoC exporting to China will be extended trade facilitation benefits. The BoC will give accredited exporters to the Philippines equal benefits.

First in mind is to include in the list of participants in the AEO Program only reliable and trusted exporters/importers or stakeholders known to be fully compliant, have good track records, and are willing to undergo the stringent accreditation process.

That way, one avoids criticisms of picking or accrediting entities that have no track record of lawful and compliant importation and exportation. This program would surely complement the socioeconomic agenda of the President.


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