Time release studies: Making trade faster and more predictable in Europe and Central Asia

Globalization has brought about a dramatic increase in cross-border trade as well as a proliferation of global value chains. Just-in-time delivery of goods has become even more important for businesses, and can benefit all parties involved in the supply chain. For efficient and smooth delivery of goods to happen, however, borders need to be optimized and the time required to complete trade procedures needs to be as fast as possible.  This will help countries reap the gains from value chain participation, increase competitiveness, and be more resilient in times of crisis.

Measuring the time to trade

Customs administrations and other government agencies (OGAs) carry out controls of export and import consignments at borders and inland terminals. Traders and policymakers are increasingly concerned that it takes too long to carry out these controls. Delays at borders cost them time and money and may affect the country’s attractiveness and competitiveness as an investment location. 

To improve border management, improve access to world markets and enhance participation in the global trading system, the World Bank Group helps developing countries align their trade practices with the World Trade Organization’s (WTO) Trade Facilitation Agreement (TFA). A key part of this work is the periodic publication of average release times. In Europe and Central Asia, the World Bank Group has supported 13 Time Release Studies (TRS) based on the World Customs Organization methodology. The common regional market action plan of the Central European Free Trade Agreement (CEFTA) encourages its members - Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, and Serbia - to implement such studies to further harmonize and streamline border control procedures in the region.

Time Release Studies – an effective assessment tool

The TRS enables Customs authorities and OGAs to quantify bottlenecks in the clearance and release processes through the collection of time release data that effectively measures the efficiency of the border agencies and private sector stakeholders involved in the control process, from the time the cargo arrives at the border until the physical release of the goods. Based on this detailed and comprehensive diagnostic, the relevant authorities can improve the quality of services provided and identify other potential corrective actions for areas that cause unnecessary delays. Measurement of time release is critical to assessing the impact of trade facilitation reforms.

Benefits for governments and traders

The TRS provide border agencies and the trade facilitation community with a wealth of detailed data on the efficiency and speed of the border control and clearance process. Business operators, the cargo industry, and other intermediaries greatly benefit from the publication of release times because increased transparency and predictability helps them make better business decisions and trade.  Ideally, the evidence of lengthy release times will also bring both public and private stakeholders together to develop and advocate for faster and less onerous procedures and to collaborate to implement them, especially benefitting small and medium enterprises.

A benchmark for reform, enhancing performance, and encouraging regional harmonization

With World Bank Group support, Kosovo carried out its first TRS in 2016. The establishment of an Authorized Operator Program (AEO) was one of the recommendations of the study, and the Kosovo Customs Administration adopted and implemented this recommendation. To date, five AEOs have been certified and are now benefiting from faster and cheaper clearance processes. One AEO cited clearance times have been reduced from 24 hours (or more) to less than 3 hours as a result of the new status. Overall, import processing times have reduced for all traders by 50 percent at the borders and over 30 percent at the inland terminals (between 2016 and 2021).

In Serbia, a TRS conducted in 2017 recommended the harmonization of clearance procedures with neighboring countries to help the business community. An agreement between Serbia and North Macedonia was signed to establish a joint border crossing for international road traffic at Presevo/Tabanovce. Fast forward to 2021 and exit controls of customs and border police are performed upon entry into each country. As a result, the waiting time for trucks has been reduced from 26 to 10 minutes for exports, as confirmed in a second TRS conducted in 2021.

In the Kyrgyz Republic, a TRS conducted in 2018 suggested the Customs Administration standardize procedures across locations and introduce a trusted traders regime. The Customs Administration initiated the implementation of these and other improvements, whilst the World Bank Group also trained the phytosanitary and veterinary agencies on how to develop risk-based controls to further reduce clearance times. A second TRS was conducted in 2021 and revealed that road import times were reduced to under nine hours (compared to close to 20 hours in 2018).  

The second round of TRS in the Western Balkans has shown that important reforms were implemented after the first study, and that several have resulted in significant improvements. Equally, the willingness of the border agencies to make the results of the studies public underlines their readiness to be transparent.

Financial support for these World Bank Group time release studies was provided by the Trade Facilitation Support Program (TFSP). The TFSP is funded by nine donor partners: Australia, Canada, the European Commission, the Netherlands, Norway, Sweden, Switzerland, the United States, and the United Kingdom.