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​Single Window Systems: What We Have Learned

Gerard McLinden's picture

//www.flickr.com/photos/nuzz/4183802267/The clearance of imports and exports by customs and other agencies are among the most problematic links in global supply chains. They are frequently blamed for undermining the capacity of developing countries to compete on global markets. As a result, the Bank and other development organizations have devoted a great deal of attention to supporting reform and modernization of border clearance processes. In spite of significant effort, border management inefficiencies continue to impact heavily on the competitiveness of developing countries.


Research undertaken by the Bank in recent years has started to shed some new light on the reasons why progress has been so slow. While improving the performance of customs remains a high priority for many countries, it is only one of the many agencies involved in border processing, and is frequently the most modernized. Customs agencies are often responsible for no more than one-third of regulatory delays. Data from the Logistics Performance Index (LPI) suggests that logistics professionals across the world rate their level of satisfaction with customs much higher than that of other border management agencies. In most countries, customs agencies already employ IT systems to process declarations and use some form of risk management to ensure all shipments are not inspected. In addition, they normally attempt to balance their control responsibilities with trade facilitation objectives and are guided by international standards developed in the World Trade Organization and the World Customs Organization. Many other border management agencies have simply not modernized to the same extent.

The focus of reform efforts therefore needs to shift beyond customs to tackle the systems and procedures employed by other border management agencies, such as health, agriculture, quarantine, police, immigration, standards, and myriad other organizations involved in regulating trade flows. In many countries, it is not uncommon for more than 30 different government agencies to play a role in the processing and clearance of goods. If a raft of paper-based documents needs to be taken to multiple agencies – then examined and approved before the goods are released – it matters little if customs declarations can be processed electronically. Achieving meaningful trade facilitation gains requires a comprehensive approach based on effective information-sharing, streamlining of procedures and genuine collaboration among all border management agencies.

One new and innovative approach to border processing and clearance is the establishment of National Single Window systems, which allow traders to submit all import, export, and transit information required by regulatory agencies via a single electronic gateway, instead of submitting and processing the same information numerous times to different government entities, including some that are automated and others that still rely heavily on paper.
    
The logic of this approach is obvious, but the complexity of its implementation is often underestimated. To put it simply, establishing a National Single Window is not a simple “plug and play” activity, nor is it possible to simply replicate what has worked in one country in another country that has quite different capabilities, resources, and institutional problems.
 
Sustainable institutional reform is hard when only one government agency is involved, but the risks and challenges are multiplied exponentially when many agencies are involved.  Recent experience in countries such as Tunisia, Indonesia, and the Philippines suggests that a number of critical preconditions need to be in place to launch a single window program, including:  

  • A strong business case based on a pragmatic assessment of risks, challenges and capabilities;
  • A clear and unambiguous mandate from government backed by genuine political will;
  • A realistic future vision – owned by all stakeholders;
  • Agreement on governance structures, including which agency will lead the initiative, with clear roles and responsibilities for all key stakeholders, and obligations and accountabilities for success; and
  • A practical work program with key milestones matched by appropriate human and financial resources. 
For Bank staff engaged in supporting single window projects, more attention needs to be devoted to developing broad-based commitment during project design, to identifying the individual responsibilities and goals of all participating agencies, and to incorporating a good deal more face-to-face support during implementation. This represents a major challenge; tight preparation and supervision budgets rarely finance the sort of intensive hands-on approach required.
 
Not surprisingly, achieving meaningful results in establishing single window systems depends principally on building genuine collaboration between stakeholders. It makes sense to start with activities designed to build trust and understanding between participating agencies. Despite the challenges involved, practical examples now exist throughout the world that demonstrate the extent of border reforms possible, even in relatively difficult environments.
 
The Bank’s work in the Lao People’s Democratic Republic provides one example of what can be achieved when a government commits to a program. With support provided by the Bank and others, the government developed a National Trade Facilitation Strategy and established a National Trade Facilitation Secretariat to provide an institutional framework to support implementation.
  
The National Trade Facilitation Strategy outlines a clear reform vision and assigns firm roles, responsibilities, and obligations to all participating agencies. This framework facilitates coordination between all agencies and provides a focal point for support from the development community. With support from the Bank, Lao PDR has established a Trade Information Portal that allows traders to access all relevant trade rules, regulations, procedures, fee schedules and forms from all border management agencies through a single user-friendly Web site. The same interagency coordination arrangements are now being used to develop an electronic single window system.
 
The Bank is currently engaged in a single window preparatory project that is designed to help the Lao PDR government make informed decisions in proceeding with the single window system. The Bank is providing support on important technical elements, such as legal and regulatory frameworks, fee models and governance structures. In addition, the Bank is financing the development of a comprehensive strategy to build government capacity and smooth the transition to a single window system.
 
The bottom line is that national single window systems provide a very practical means of improving border clearance performance. In a sense, they can serve as a ‘Trojan Horse’ to overcome institutional resistance to cooperation and change.   They are not, however, a simple thing to develop and implement. Most of the challenges are not associated with technology but rather getting individual agencies to collaborate to achieve a collective goal. The Bank has developed a good deal of practical experience in recent years on what works, what doesn’t and why. We know, from trial and error, that certain prerequisites need to be in place to support reformers. Carefully planned and executed preparatory work by development partners, in particular, can greatly improve the probability of success.
 
 
 
 

Comments

Submitted by naghmeh on

i belive that establishing SW in developing countries requires elimination of beauracracy in deep levels. for instance in iran we have some rules addressing SW establishment but it has not operated yet.

Submitted by Ted Haas on

I agree with the post. I have been involved in helping (in a very small way) the United States move forward in their Single Window implementation at ITDS (International Trade Data System. One of the key requirements for the single window to soar would be to have a classifications system wide and deep enough to help automated the multiple jurisdiction instances. The initial report on this can be found on the ITDS site at http://www.itds.gov/linkhandler/itds/news/ecommerce_product_data.ctt/ecommerce_product_data.pdf
Much work has been done since with pilots, with very good results. The latest presentation can be found on the ITDS site at http://www.itds.gov/linkhandler/itds/tsn/itds_released_comment.ctt/itds_pic_presentation.pdf
My understanding is that The WCO is also aware of these initiatives and looking favorably on them (but obviously much more work needs to be done) I would claim that the e-commerce code set best positioned to help achieve the single window may well be the UNSPSC which is owned by The UNDP and managed by GS1. At the risk of being perceived as too bold or forward. I can envision a day in the not too distant future where all the national single windows can talk with each other and clear and consistent visibility of global trade can be created. This seems to be already underway in the area of medical Devices where The United States is standing up The UDI (Unique device Identifier) and The IMDRF (www.imdrf.org)(as I understand it) is working to stand up a global network of regional medical devices approval and auditing offices based on UDI

Submitted by Mark-ZA on

Good read and do not disagree, but as long as states treat border posts and other ports of entry as the 1st point at which they receive and process information for clearance and release purposes, that environment/facility will remain a sub-optimal chokepoint, despite any SW solution. If the SW only activates on arrival of goods at a border post/port, then everything waits there until processing is finished. SW should be pre-arrival and for pre-clearance, so that border post/port becomes solely for interventions, as may be required.

Submitted by Peter Baish on

Good article Gerard.

Some points:
1. Some agencies derive their operating revenue, all or in part, from fees collected. Simplification is asking them to kill their funding.
2. Some agencies are duplicate Customs services and do not want to lose staffing and status.
3. Like you stated in your article, many agencies have not adopted more modern methods of processing like Customs. A 2 hour Customs release does little good if the other agency takes a week.
4. A single window should use a true SAD (Single Administrative Document) to collect their information and cut down on the number of forms that need to be prepared.
5. A single window should focus on the licenses, permits and certificates needed for import and export. Eliminate or allow filing of these with the Customs declaration/entry.
6. Drive the Single Window through the gathering of user requirements from the Trade Community.
7. Ensure that Customs Brokers and corrupt government servants are not collecting bribes in exchange for clearing the cargo. If corruption is present, single window is impossible to implement.

I hope the Laos experiment is fruitful. Best Always,
Peter

Great article Gerard, and very important to stress that the primary challenges associated with improved trade facilitation and single window introduction are associated with public sector and institutional change (with ICT very much the smaller part).
Richard

Submitted by Mitsu on

Interesting article.
My concerns are a system itself, and a coordination among relevant government agencies. As you pointed out, it is difficult to simply import a single window system from one country to another country. Customization of the system is needed. And the customization needs much time to meeting and meeting...
National Trade Facilitation Strategy is a good idea. The National Trade Facilitation Secretariat should be a senior organization to OGAs. If the Secretariat is same level as OGAs, OGAs might not follow the decision made by the Secretariat in case it causes them inconvenience.
I hope success of your Lao project.

Submitted by Quang Anh Le on

Congratulation for concise observations. A National Single Window should be included into a National Strategy of Competitiveness for Sustainable Growth. Non Tariff Measures and its related procedural issues could be partially addressed using advantages of a National Single Window, at the initial stage through better transparency for informed compliance. Whether you call it by any name, the bottom line is always change management and political commitments of the country and more importantly motivation by the private sector in undertaking courageous decisions towards streamlined processes. Although we focus on trade facilitating aspects of a national single window, security shall also be addressed by a series of measures and compliance tools. I look forward hearing more from you and other colleagues. Thanks for your efforts

Submitted by Yin Lai Chow on

Great article Gerald. We experienced much more clearance delay and unnecessary formalities in one of the country examples in your article ever since their implementation of National Single Window. While agriculture, health, environment, police etc. agencies have obvious reasons and mandates for their scope of controls; their individual implementing regulations and procedures need to be refined for operation under integrated platform. Implementation of National Single Window using World Customs Organization customs HS code as sole reference indicator for all types of boarder control requirements of all agencies confuses traders and front line officers of concerned agencies, instead of facilitating trade and enhancing efficiency of controls.

Submitted by Luc DeWulf on

I like this short and clear presentation. Very informative and to the point. Your comments of the various factors that need to be taken into account when starting the process of introducing a single window are a must read for the colleagues involved in this process. The process launched in Laos focused on the right things and I was very pleased to see that it will dovetail the Trade Portal initiative, that in the future will proceed to simplify the existing procedures.
Thanks

Submitted by Doug on

Compliance at the manufacturer or entry point to the supply chain for forest goods, etc may also stop the use of goods covered by endangered species and other rules. Checks on company owners can stop revenue to terrorists and that compliance can be carried through the supply chain to wholesalers and retailers. If people are out of a job because it stops the under desk payments to their hands maybe they can get a job in manufacturing where the real value is added to a country

Submitted by Luc Pugliatti on

Belatedly, I have come across you post, Gerard. Excellent points especially the key issue that, often, Customs is more advanced in terms of ICT maturity than other agencies which, very often, make very little use of ICT in an enterprise sense. For this reason in many SW projects Customs is the lead agency and tends to 'drag' the other agencies along, often reluctantly. In some places SW is also referred to as a 'Customs Single Window' which betrays a Customs-centric view of the clearance process. The approach the Bank has taken lately of including all the government actors in the scope at the onset around an inclusive governance structure and focusing on the benefits in control and efficiency that SW would also accrue for them is to be commended. This also means that the implementation of the IT facilities must be coupled with business re-engineering and capacity building on a larger scale with the OGA's than with Customs and, therefore, the scope and pace of the project must be geared accordingly rather than being driven by the relatively easy ICT implementation agenda. What happens without that is what we have seen in some places where SW is a mere electronic duplicate of the old manual processes with little advantage to the trade.

Submitted by Salamat Ali on

I agree with Luc that Customs is always a lead agency in automation of clearances and it drags other agencies along, which is usually a big challenge. This is exactly what we experienced in Pakistan. The custom administration of the country tried for years to pull along other regulatory ministries but gave in at last. In this tug of war, Pakistan had to close down a state of art automated clearances system (PaCCS) and switch to a semi-automated one.

Why customs administration is so tech-savvy is quite interesting, though customs officer are a part of the same civil service in most of the countries. I would like to hear response of other colleagues about this.
In Pakistan, this change was brought about by the influx of electrical and civil engineers since the late 1990s. These qualified professional could not find technical jobs and opted for civil service through open competition, and re-engineered the business processes.

Submitted by Mosh on

It is a very insightful article that needs to be read by some of the officials and stakeholders who want to implement the single window system. Kenya is planning on rolling out the system and I had to read and understand what is all about. It is very true that countries planning to implement the SWS, should not replicate what has been successful on other countries because of different resources, capabilities among many other things that they have.

Submitted by Marcos Miguel on

My congratulations about the IT lessons given by the previous writters. i am concerned with single electronic window integration with e-taxation,as an information exchange approach related to taxpayers across information for compliance enforcement, mostly required when the taxapayer claim for VAT refund based on imports and operate business or render services. please i want to hear from your experience how this process has been developed in the IT environment in both SEW and e-taxation.

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