Upgrade the Cross-Border Trade Index

	Improving the rank of cross-border trade transactions index: Needs synchronization
	Offering solutions to enhance the rank of cross-border trade transactions index
	Waiting for changes in specialized inspections

Shortcomings on warehousing and logistics operations are one of the reasons for the declining cross-border trade index. Photo: Dang Nguyen

Transforming shortcomings into advantages for reform

Every May, the World Bank (WB) conducts a survey to assess the competitive environment of 190 countries around the world. In order to continue implementing the tasks and solutions of improving the business environment, raising the national competitiveness, in 2019, the Government issued Resolution 02/2019 / NQ-CP, which assigns relevant ministries to monitor the improvement of indexes. The Ministry of Finance is assigned as the key unit in charge of monitoring the improvement of the index of the cross-border trade index (A8), the stock market capitalization index (B7) and the composition of paying taxes in Indicator A2 (Paying Taxes an Insurance Indicators. The General Department of Customs has been assigned by the Ministry of Finance to implement solutions to upgrade the cross-border trade index

In order to build specific solutions, Deputy Director General of General Department of Customs Hoang Viet Cuong, directly worked with units in areas with large volumes of import and export goods, such as in Ho Chi Minh City and Hai Phong. The meetings are not only concentrated within the Customs, but also assess the situation and existence of all parties: Customs authority; specialized inspection agency, port authority, port, warehouse, and logistics operators; shipping lines, international and domestic transportation firms etc., in the process for export commodity group HS85, and import of commodity group HS8708 in particular (these are two groups that WB selects to measure) and import and export goods in general.

Cuong said, according to a detailed analysis of the time and cost of cross-border trade transactions of the World Bank, the time under the responsibility of the Customs agency only accounts for 11% for imports, 4% for exports in the total cross-border import-export period. The time under the responsibility of the unloading, warehousing and logistics units accounts for 28% for imports and 50% for exports. The time under the responsibility of specialized inspection agency is significant, accounting for 61% for imports and 46% for exports. Thus, the advantages for reform of Customs and other agencies and units are remarkable.

The General Department of Customs stated that some shortcomings can be improved to reform and facilitate production and business activities of enterprises. On the Customs side, the IT application has not covered all areas of state management on customs, and contents of legal documents often change. However, the process for approval of a project of building IT systems must undergo many steps and contains many procedures, so the level of IT system response sometimes does not keep up with the new legal regulations. Besides, the application of risk management methods in customs operations still has some limitations; the selection of screening has not yet completely met the management requirements.

Meanwhile, the implementation of administrative procedures on the National Single Window, ASEAN Single Window and specialized inspection reform still need to be improved more. The number of goods subject to industrialization is still considerable. Legal documents on specialized management and inspection are wide ranging , many items do not have HS codes and there are not sufficient standards and regulations to conduct inspections; regulations are still overlapping, one commodity must be managed and inspected by many ministries; the revision of legal documents on specialized management and inspection for imports and exports are still slow. The specialized inspection is mainly done by manual and risk management methods, and mutual recognition of inspection results have not been applied.

Shortcomings on warehousing and logistics operation are also shown as follows: Asynchronous transport infrastructure, lack of connectivity and lack of resources to modernize and improve loading and unloading capacity, the imbalance in supply and demand among ports., etc. These shortcomings curbed warehouse, port system and increased logistics costs. In some localities, the large number of warehouses and yards are scattered without specific orientations, so the business efficiency of many warehouses and yards is ineffective, and inappropriate with the input resources.

In particular, shortcomings on warehouse and yard operations are also indicated. For example, at Cat Lai port, the asynchronous and unconnected infrastructure and traffic jam for many hours on Dong Van Cong Street (District 2) and Nguyen Van Linh (District 7) caused damage to enterprises, pushing up the logistics costs.

Carrying out synchronous solutions

Facing the current problems, at the meetings with agencies and units in the two localities of Ho Chi Minh City, Hai Phong, Deputy General Director Hoang Viet Cuong said, the Ministry of Finance (General Department of Customs) will quickly implement the action plan program to summarize and report to the Prime Minister in order to upgrade the cross-border trade index

The Customs will continue to study, develop as well as submit to competent authorities for issuing documents to amend, supplement and guide the implementation of the Customs Law and the Law on Import and Export Duties. In the immediate future, focusing on studying and amending and supplementing Decree No. 125 / ND-CP on Import and Export Tariffs, Preferential Import Tariffs and Lists of goods on absolute tax rates, compound taxes and import tax outside the tariff quota to solve problems and unify the classification of goods, and facilitate import-export enterprises; submit to the Government for promulgation a Decree on Vietnam’s special preferential Tariffs to implement newly signed and effective trade agreements (CPTPP, ASEAN-Hong Kong ...). At the same time, promoting the implementation of electronic tax payment and improving the efficiency of applying risk management criteria in the channel classification of imports and export.

The Customs will continue to coordinate with ministries to conduct the specialized management and inspection for imports and exports goods, such as by reviewing legal documents on specialized management and inspection for imports and exports. In particular, reviewing and proposing amendments to documents: Circular 13/2015 / TT-BGTVT dated April 21, 2015; Circular 41/2018 / TT-BGTVT dated July 30, 2018; Circular 11/2017 / TT-BCT; Circular 28/2014 / TT-BVHTDL ... in the direction of narrowing the scope of specialized management, reducing the number of items subject to inspection in customs clearance at the request of specialized management agencies.

In addition, in order to improve logistics service business, according to the General Department of Customs, it is necessary to continue to invest in improving the infrastructure system at seaports and airports. Firstly, it needs to concentrate on developing the infrastructure at Cat Lai and Hai Phong ports, to upgrade transport infrastructure system around seaports and airports, to connect ports with logistics centres. In the short term, focusing on speeding up the progress of transport projects to complete the connection of transport infrastructure in Ho Chi Minh City, reduce traffic jam in Cat Lai port area; and traffic projects to reduce traffic jams in the Hai Phong port area. Stipulating the time for circulation and channel classification of vehicles in and out of seaport and airport areas in an appropriate manner.

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For ports, warehouses and yards operators, it is necessary to invest in developing and promoting the IT application in management and supervision. Strengthening connection and exchange of information between concerned parties (shipping companies, ports, warehouses, yards operators, state management agencies, forwarding agents, import-export enterprises, banks, insurance companies and so on) at a high level. At the same time, actively joining the deployment of automated system for customs management and supervision and National Single Window.