APEC member economies agreed to make further progress on the implementation of the APEC Framework for Secure Trade at the recent meeting of the Sub-Committee on Customs Procedures (SCCP) held in Canberra, Australia.

Based on the World Customs Organization's (WCO) Framework of Standards to Secure and Facilitate Global Trade, the APEC Framework essentially acts as a blueprint, pulling together a range of 'best practice' customs, security, and business measures. The Framework will enhance 'end-to-end' security over the movement of shipping containers and international cargo. It will also contribute to regional socio-economic development by raising domestic revenue collection and reducing clearance times.

Customs-to-Customs Partnerships
New Zealand and the United States delivered presentations on the achievements of their customs-to-customs partnership which allows for the rapid and accurate exchange of information, the development of container-seal integrity programs, the first pillar of the APEC Framework.

Officials from the United States explained that the fundamental concept of the Framework is to create an environment for the secure and efficient movement of goods, services, and people across borders in the region through policy alignment and economic and technical cooperation. The New Zealand and United States customs-to-customs partnership results in recognition of each customs administration's cargo inspection authority and methods, use of advance electronic information and targeting, security assessments and employee integrity.

New Zealand's trade security strategy is to maintain its export markets through a high level of total supply chain security. This is supported by electronic reporting, risk assessment, non-intrusive and physical inspection of high-risk goods, and risk reduction strategies. New Zealand's secure exports partnership scheme satisfies the customs-to-business standards of the Framework, and New Zealand is working closely with United States to attain mutual recognition of their respective supply chain security programs. The two economies aim to complete this process in 2007 through the harmonisation of audit verification and processes, joint pilot audits of selected partner companies, and constructing a document that formalises mutual recognition.

The presentations generated discussion on a number of implementation issues of interest to members. According to officials from New Zealand, business bears the costs of compliance with supply chain security standards. However, the benefits to business outweigh the costs.

Assistance and Capacity Building
In order to fully implement the APEC Framework for Secure Trade, member economies must meet high expectations and requirements. The WCO has committed to helping APEC members reach their goals by providing diagnostic and developmental assistance. During the Sub-Committee on Customs Procedures meeting, Takashi Matsumoto, Head of the WCO's Regional Office for Capacity Building in Bangkok, detailed the progress of regional economies in implementing the APEC Framework for Secure Trade. He stressed a continued need for capacity building in the areas of strategic risk management, strategic and tactical intelligence, change management, policy development and skills in information and communication technology.

Smart and Secure Trade Lanes Project
In other developments China is working with the European Union, including the United Kingdom and the Netherlands, on a Smart and Secure Trade Lanes pilot project. The pilot, to be rolled out in 2007, incorporates advance manifest information exchange, mutual recognition of container inspections and an electronic container-seal integrity program.

While this collaboration is outside the scope of APEC activities, the pilot involves five companies from each participating economy. Thus, creating voluntary partnerships between customs administrations and businesses seek to strengthen security controls over the handling, transport and storage of cargo, the second pillar of the APEC Framework.

E-Manifest Project
Following two successful pilot projects in China and Thailand, Viet Nam is implementing an E-Manifest Demonstration Project which addresses the advance electronic information and risk assessment standards of the customs-to-customs set out in the APEC Framework. To date, the project has been implemented for air express cargo and will be extended to other transportation modes in the future.

Member economies agreed that the system developed under the project is a good model that would have broad application in the APEC region. The SCCP will consider opportunities for partnering with industry and building upon lessons learned, particularly for application to the air freight industry.

Future Directions
By committing to implement the APEC Framework for Secure Trade, APEC member economies signal their desire to both secure and facilitate world trade, and enhance the role, functions and capabilities of customs to meet the challenges and opportunities of the 21st century.

Written by John Jeffery, Chair of the Sub-Committee on Customs Procedures and Deputy Chief Executive Officer of the Australian Customs Service.