Kenya implements Regional Electronic Cargo Tracking System
The Kenya Revenue Authority (KRA) has launched the Regional Electronic Cargo Tracking System (RECTS), connecting with Rwanda and Uganda in reducing the cost of cargo transportation along the Northern Corridor.
This follows a July 3 2014 directive by the Northern Corridor Heads of State Summit in Kigali, compelling Kenya, Rwanda and Uganda to embrace e – monitoring of transit cargo along the corridor through a harmonized system to enable seamless flow of cargo.
The new system replaces the existing Electronic Cargo Tracking System (ECTS) where monitoring is done independently through stand-alone platforms. This forced KRA officers to toggle between screens, therefore making the process very tedious and ripe for abuse.
“Over the years, the cargo volume along the corridor has been increasing steadily, hence the need to facilitate quick movement of cargo without compromising customs security controls,” said KRA Commissioner Julius Musyoki, “Challenges such as revenue leakages, unfair competition in the business environment and increased costs of doing business necessitated a review of the current ECTS.”
RECTS has been financed by the United Kingdom Department for International Development (DFID), through TradeMark East Africa. According to Frank Matsaert TradeMark East Africa (TMEA) CEO, RECT’s efficiency will ingrain fair terms of
trade by creating a level playing field for both importers and local industries as it helps in eliminating diversion of cargo.
The new system will largely facilitate trade along the Northern Corridor as it lowers the cost and time of doing business. It is also expected to curb theft and diversion of goods destined for markets within the Northern Corridor through the port of Mombasa.
RECTS is a harmonized system connecting Kenya, Rwanda and Uganda. It presents 24/7 Central Monitoring Centres (CMC) in Nairobi, Kampala and Kigali with a view of the entire region.
It also consists of 12 Rapid Response Units consisting of Customs and Police Officers along the Northern Corridor. The new system also comprises of smart gates and automatic number plate recognition at the port gates and borders. This eliminates manual data capture and reduces the dwell times at the borders and port gates.
RECTS brings along better cross border coordination and transit monitoring, improved voluntary compliance with transit laws and regulations. It also ensures that minimal costs are used in enforcement hence better revenue collection.
There is also an aspect of transparency in cargo tracking since stakeholders are given access to the system. The RECTS system triggers an alarm whenever there is a diversion from the designated route or an unusually long stopover.
The decision by the Northern Corridor Heads of States to implement the RECTS is a move towards improving tax collection and employing advanced technologies to facilitate handling of cargo and data along the corridor.
Source: TradeMark East Africa.
WTO’s Trade Facilitation Agreement enters into force
Rwanda, Oman, Chad and Jordan submitted their instruments of acceptance to WTO Director-General Roberto Azevêdo, bringing the total number of ratifications over the required threshold of 110. The entry into force of this agreement, which seeks to expedite the movement, release and clearance of goods across borders, launches a new phase for trade facilitation reforms all over the world and creates a significant boost for commerce and the multilateral trading system as a whole.
Full implementation of the TFA is forecast to slash members' trade costs by an average of 14.3 per cent, with developing countries having the most to gain, according to a 2015 study carried out by WTO economists. The TFA is also likely to reduce the time needed to import goods by over a day and a half and to export goods by almost two days, representing a reduction of 47 per cent and 91 per cent respectively over the current average.
Implementing the TFA is also expected to help new firms export for the first time. Moreover, once the TFA is fully implemented, developing countries are predicted to increase the number of new products exported by as much as 20 per cent, with least developed countries (LDCs) likely to see an increase of up to 35 per cent, according to the WTO study.
DG Azevêdo welcomed the TFA's entry into force, noting that the Agreement represents a landmark for trade reform. He said:
“This is fantastic news for at least two reasons. First, it shows members' commitment to the multilateral trading system and that they are following through on the promises made in Bali. Second, it means we can now start implementing the Agreement, helping to cut trade costs around the world. It also means we can kick start technical assistance work to help poorer countries with implementation.
“This would boost global trade by up to 1 trillion dollars each year, with the biggest gains being felt in the poorest countries. The impact will be bigger than the elimination of all existing tariffs around the world.
“But this is not the end of the road. The real work is just beginning. This is the biggest reform of global trade in a generation. It can make a big difference for growth and development around the world. Now, working together, we have the responsibility to implement the Agreement to make those benefits a reality.”
The Agreement is unique in that it allows developing and least-developed countries to set their own timetables for implementing the TFA depending on their capacities to do so. A Trade Facilitation Agreement Facility (TFAF) was created at the request of developing and least-developed countries to help ensure they receive the assistance needed to reap the full benefits of the TFA and to support the ultimate goal of full implementation of the new agreement by all members.
Developed countries have committed to immediately implement the Agreement, which sets out a broad series of trade facilitation reforms. Spread out over 12 articles, the TFA prescribes many measures to improve transparency and predictability of trading across borders and to create a less discriminatory business environment. The TFA's provisions include improvements to the availability and publication of information about cross-border procedures and practices, improved appeal rights for traders, reduced fees and formalities connected with the import/export of goods, faster clearance procedures and enhanced conditions for freedom of transit for goods. The Agreement also contains measures for effective cooperation between customs and other authorities on trade facilitation and customs compliance issues.
Developing countries, in comparison, will immediately apply only the TFA provisions they have designated as “Category A” commitments. For the other provisions of the Agreement, they must indicate when these will be implemented and what capacity building support is needed to help them implement these provisions, known as Category B and C commitments. These can be implemented at a later date with least-developed countries given more time to notify these commitments. So far, notifications of Category A commitments have already been provided by 90 WTO members.
As of today, the following WTO members have accepted the TFA: Hong Kong China, Singapore, the United States, Mauritius, Malaysia, Japan, Australia, Botswana, Trinidad and Tobago, the Republic of Korea, Nicaragua, Niger, Belize, Switzerland, Chinese Taipei, China, Liechtenstein, Lao PDR, New Zealand, Togo, Thailand, the European Union (on behalf of its 28 member states), the former Yugoslav Republic of Macedonia, Pakistan, Panama, Guyana, Côte d’Ivoire, Grenada, Saint Lucia, Kenya, Myanmar, Norway, Viet Nam, Brunei Darussalam, Ukraine, Zambia, Lesotho, Georgia, Seychelles, Jamaica, Mali, Cambodia, Paraguay, Turkey, Brazil, Macao China, the United Arab Emirates, Samoa, India, the Russian Federation, Montenegro, Albania, Kazakhstan, Sri Lanka, St. Kitts and Nevis, Madagascar, the Republic of Moldova, El Salvador, Honduras, Mexico, Peru, Saudi Arabia, Afghanistan, Senegal, Uruguay, Bahrain, Bangladesh, the Philippines, Iceland, Chile, Swaziland, Dominica, Mongolia, Gabon, the Kyrgyz Republic, Canada, Ghana, Mozambique, Saint Vincent & the Grenadines, Nigeria, Nepal, Rwanda, Oman, Chad and Jordan.
Source: World Trade Organization