Promoting digital customs transformation by adopting a data mining culture and building a data ecosystem

With the theme of 2022 "Promoting digital customs transformation by applying a data mining culture and building a data ecosystem", the WCO Secretary General's New Year message outlined the important goals of the year and solutions to promote the "digital customs" transformation of the Customs community in 2022.

According to the WCO, the Covid-19 pandemic is not over yet, so Customs authorities need to identify human resource challenges and make the most of existing underutilized data.

According to WCO, although the trend of data-based governance is inevitable, the Customs authority still faces many difficulties in technical and legal issues in order to be able to implement policies geared towards the more efficient use of available data. WCO believed that Customs authorities could carry out digital transformation in building a trust-based data ecosystem; adopting a data mining culture to fill human gaps; and promoting cooperation between Customs authorities.

Promoting digital customs transformation by adopting a data mining culture and building a data ecosystem. Photo: ST

Accordingly, customs is a part of a data ecosystem (defined as a collection of infrastructure, analytical systems, and applications used to receive and analyze data) to which the parties involved are citizens, government agencies, domestic and transnational businesses, etc.

These actors are the subjects that provide and collect large amounts of data. Thanks to the development of digital technology, customs authorities can access data from other government agencies, paid data, open data sources, and information sources in many different languages in the world.

Customs data has a close relationship with Customs functions. The data is used to develop strategies, improve the quality of anti-smuggling activities, collect taxes, maximize resources in border gates and customs units. The effectiveness of data use depends on many factors related to “data ethics”, including confidentiality, trade secrets, legal issues related to data use by tax and customs authorities and the importance of reform in the field of public administration.

Regarding this content, the WCO recommended the following actions: Establishing a formal data governance mechanism to ensure the relevance, accuracy and timeliness of data; using standards developed by the WCO and other organizations regarding data formats and data exchange; ensuring proper data management to ensure that the right people have access to the right types of data and that data protection regulations are respected; applying advanced approaches, such as data analytics, to successfully collect and mine data to drive decision-making.

As for how to apply a data-mining culture to fill human resource gaps, WCO believed that the biggest obstacle for every organization that prioritizes decision-making is not technique but culture. A data mining culture is when all members of an organization have access to a data analytics system with the knowledge needed to leverage data for work. In order to be able to create and maintain a sustainable data culture, experts emphasized that senior management needs to have certain expectations about data-driven decision-making.

A data-mining culture will allow people to ask questions, challenge initiatives, and make decisions based on facts, not feelings.

In order to foster a data mining culture, customs authorities need to strengthen the skills of their staff, making sure they are able to read and analyze data correctly. Customs should include data integration skills in their requirements for new recruits and involve them in developing online courses to familiarize them with data collection and analysis aiming to strengthen data culture.

Besides training, Customs authorities should develop an effective strategy to retain competent officers in this area. Customs officers also need to take a broader view of the influence of Customs authorities in the areas of social protection, trade facilitation and fair tax collection.

Finally, to promote cooperation between customs authorities, the WCO recommended that Customs authorities take advantage of data in relation to other parties in the international supply chain, as well as providing data public and academia as a tool to enhance transparency, promote knowledge sharing and dialogue with the community.

Sharing data with other government agencies to strengthen the role of the Customs authority in decision making and necessary resources including seeking funding. Making customs information and data easily accessible is also part of the government's response to the general demand for open governance.

International organizations such as the World Bank, the International Monetary Fund, the OECD Economic Cooperation and Development, the United Nations Office on Drugs and Crime UNODC, or the International Trade Center (ITC) also wanted to seek customs data to guide resource allocation and evaluate the effectiveness of modernization projects. Enterprises in the private sector specializing in data applications are also eager to promote the use of data and related tools in public administration.

To support member bodies, the WCO has been putting data-related topics on the agenda of committee sessions, working groups, organizing seminars to raise awareness, developing online training components, develop capacity building framework on data analytics.

Along with that, WCO established a Band of Customs data analysis (BACUDA) made up of scientists’ data to develop a methodology for data analysis. Currently, the WCO Secretariat is working on developing a WCO Data Strategy with the ambition that data will be a common language between customs authorities and the WCO Secretariat and its members.