Afghanistan's Agenda for Action - Economic Growth - usaid

More documents

Recommendations

Info

Afghanistan’s Agenda for Action: Developing the Trade & Business Environment – August 20074. WTO AccessionBoth the public and private sector poorly understandthe benefits and risks of WTO accession byAfghanistan. Many misconceptions of the effect ofWTO accession on Afghanistan were encounteredduring interviews with both the public and privatesector.5. Customs ProceduresACD’s procedures are fully manual and require manysteps and signatures to gain the release of goods.Traders, brokers and transporters all reportedprocedural improvements and streamlining in the pastyear signifying progress and a desire of ACD toimprove their cargo operations. However, remainingprocedures and a lack of selectivity and riskmanagement enable the widespread practice offacilitating payments/bribes for Customs officers.Import processes, despite improvements, continue tobe complex and burdensome leading to delays andincreased costs. Additionally, much of Customs midand lower level workforce is strongly wedded to theexisting processes. For example, Afghan CustomsBrokers generally do not rate Customs professionalismas high due to lack of training of officers. While recentimprovements in processing are noted, revenuecollection ranks as a higher priority than tradefacilitation. Many officers also view facilitation efforts asan impediment to increased Customs receipts, althoughin practice they have the opposite result whencombined with other internal reform measures.Therefore this is no real push by ACD for suchfacilitative measures as selectivity in examinations or apost audit approach to regulating trade.6. Customs CollectionsA heavy reliance on upon Customs collections andmeeting IMF targets has caused a degree of turmoil inAfghanistan’s trade community and has provencounterproductive to trade facilitation: In an emergingeconomy such as Afghanistan’s, too much emphasis onincreasing Customs collections can cause Customsdepartments to arbitrarily raise duty rates and fees,cease refunds, increase the number of unwarrantedseizures and penalties and encourage other poorpractices such as misclassifying goods to achieve higherduty rates. These aberrant practices may raise revenuewhile causing an unintended consequence of inhibitingforeign trade.7. AutomationThe ACD has implemented and deployed the transitmodule of the UN’s modern Customs automatedsolution ASYCUDA++ (Automated System forCustoms Data), which is a great accomplishment andan advantageous means to achieve ACD’s ambitiousgoals of modernization and reform. Rather than relyingon a network, ACD is using satellite communicationsto link ports and stations. The ongoing implementationof the (ASYCUDA) will increase transparency (easyreporting, international classification, performancemonitoring) and control (including through a reductionin interface between Customs officers and traders),while facilitating trade (more standardized, predictable,transparent procedures). Reducing the ability ofCustoms officers to arbitrarily detain and holdshipments is a key method to reduce unofficialpayments. Transit is considered a priority: all goodsentering into Afghanistan will be reported to thesystem and automatically discharged when they reachtheir destination. The first application is operationaland reportedly working well. The new procedurecovers the transit corridor between the Torkhamborder point with Pakistan and Kabul and will beextended to the border with Uzbekistan. Additionally,ASYCUDA ++ can be used for many other functionssuch as risk management, selective examination,collections and trade statistics. Most importantly,AYSCUDA++ will allow truck traffic to clear at theborder and eliminate the confusion and additional costsof clearance at the inland Customs houses.An experienced team of contractors with the necessarytechnical and operational staff is managing theimplementation assisted by a small group of ACD staff.Additionally, an EU system for collecting anddisseminating trade statistics, EUROTRACE, is in placeand active at the Kabul Customs house.Use of standard prices maintained and published byCustoms for import valuation in lieu of invoice valueslengthens the time and cost of preparation of Customs113
Afghanistan’s Agenda for Action: Developing the Trade & Business Environment – August 2007documentation. In fact, the ASYCUDA team isdeveloping a reference tool for these presumed values.In reality, many emerging Customs services maintainsuch lists to counter chronic undervaluation. Such useis also in contravention of GATT Article VII that offersmodel statutes (beginning with transaction value) forCustoms valuation that should be followed uponAfghanistan’s accession to the WTO.8. CorruptionSalaries for public servants are very low and do notcompete with private sector salaries. Additionally,harsh climates and poor living conditions along withsevere security threats often contribute to the poorrecruitment levels in Customs stations outside ofKabul. Facilitating payments are universal to theCustoms operation as well as any other governmentunit such as Customs police and mobile verificationteams that has the opportunity to hold goods ininternational commerce. Additionally, entire shipmentscan be passed through Customs withoutdocumentation or duty payment at much higher figures.The trade community provided payment figures rangingfrom a low of 100 AFG to 6000 AFG depending uponthe value of the goods and the “service” beingrendered.9. StaffingA stable, well-trained cadre of Customs officers isnecessary for reform, modernization and themaintenance of an effective and efficient Customsservice. Salaries in the ACD are not commensuratewith workload and complexity of modern Customsoperations. Many of the current Customs staff has heldCustoms positions for long periods of time includingtime under the Taliban rule. Generally, mid-level andsubordinate personnel are not regarded highly by thosewe interviewed but that the higher echelons were wellregarded. Hiring well qualified individuals for lineCustoms positions is being attempted but retentionrates for these hires is low due to the availability ofother better paying positions.10. TrainingMost training for ACD’s employees is informal, on thejob training. New classrooms and a computer lab arepart of ACD’s Kabul Customs house’s facilities. Theyare used periodically for special sessions or updatesincluding Brokers’ training. A lack of formal Customstraining, basic and advanced, is a lost opportunity toenhance professionalism and to correct individual badpractices, weed out incompetent hires as well as toprovide standardized curriculums in Customs law,procedures and ethics. Formal training, especially basiccourses for new hires, provides opportunities to filterweak selections by dismissing them for failure to passexaminations and practical exercises.11. Intellectual Property RightsTraining in identifying counterfeit goods does not occurand border officials are unfamiliar with procedures tobe followed if counterfeit goods are encountered. Thisissue must also be addressed in the passage and duringthe implementation of the WTO statute forAfghanistan.12. Risk ManagementRisk Management is a systematic approach to makingdecisions under uncertain conditions by identifying,assessing, understanding, planning and communicatingrisk issues. For Customs and border agencies, it ismeans to move from an attempt to achieve totalcontrol of documents and goods for every shipment toa rational, data driven process to select cargo forintensive examination. Most countries have adoptedthe risk management approach to facilitate theinternational movement of goods from compliantimporters while devoting their Customs and othercontrol agency resources to goods that have thehighest potential impact on revenue, the economy andthe health and welfare of its citizens. Risk managementdeployment simply means that a large proportion ofinternational shipments can cross the border quicklywith no inspection and minimal formal requirements.As a result, opportunity for bribe solicitation andpayment is reduced because of increased transparency.The move to capture transaction data in a modernautomated system such as ASYCUDA++ provides theessentials for a risk management regime. Risk114
Page 1:
AFGHANISTAN’SAGENDA FOR ACTIONDev
Page 5 and 6:
Afghanistan’s Agenda for Action:
Page 7:
Page 10 and 11:
Page 12 and 13:
Page 14 and 15:
Page 16 and 17:
Page 18 and 19:
Page 20 and 21:
Page 22 and 23:
Page 24 and 25:
Page 26 and 27:
Page 28 and 29:
Page 30 and 31:
Page 32 and 33:
Page 34 and 35:
Page 36 and 37:
Page 39 and 40:
Page 41 and 42:
Page 43 and 44:
Page 45 and 46:
Page 47 and 48:
Page 49 and 50:
Page 51 and 52:
Page 53 and 54:
Page 55 and 56:
Page 57 and 58:
Page 59 and 60:
Page 61 and 62:
Page 63:
Page 66 and 67:
Page 68 and 69:
Page 70 and 71:
Page 72 and 73:
Page 74 and 75:
Page 76 and 77: Afghanistan’s Agenda for Action:
Page 105: Afghanistan’s Agenda for Action:
Page 174: Nicholas Klissas, USAID/EGATTel: 20
show all

Afghanistan's Agenda for Action - Economic Growth - usaid

Create successful ePaper yourself

Delete template?

Save as template?