RUSSIAN CUSTOMS DEVELOPMENT PROJECT CDP

1
RUSSIAN CUSTOMS DEVELOPMENTPROJECT(CDP)

2

3
Indicators were not all that good
4
Project at a Glance

• Russia did not need to borrow
• Project Amount 187.2 million
• Loan Amount 140.0 million
• Terms 17-years, with 5-year grace period,
• Responsible Agency RF State Customs Committee
• Expected Closing Date 30 June 2009
• But borrowing has advantages (stability,
  know-how).

5
Project

• But Russia wanted to show commitment
• Prepared in under one year
• Implementation 5 years
• Designated corridors
• Pilot sites

6
Lessons learned from past experience

• Need to focus on an objective rather than an
  institution
• Involve closely the private sector
• Rely on benchmarks and performance indicators
• Clear strategic approach
• Minimal pre-requirements

7
Objectives Accede to the WTO

• Meet international standards
• Improve compliance
• Reinforce the investment climate

8
Project components

• Components
• 1. Customs Control and Clearance
• 2. Trade Facilitation
• 3. Fiscal Policy
• Legal Framework for Customs Activities
• Organization Structure and Operational Mgmt
• Financial Management
• Human Resource Management
• Improving Integrity of Customs Service
• Information Technology
• Project Management

• Investment
• (USD millions)
• 4.02
• 9.59
• 4.05
• 5.44
• 10.23
• 6.48
• 7.27
• 2.49
• 133.23
• 3.00

9
Objectives

• Promoting International Best Practice
• Improving Compliance and Service
• Integrity
• Risk Management

10
DO Promoting International Practice

• Adopt Kyoto-based Customs standards to expedite
  the processing of low-risk transactions while
  improving the detection and prevention of
  contraband
• Facilitate international commerce and accession
  to the WTO
• Stronger partnership between Customs and
  participants of foreign economic activities
• Transforming the mindset of SCC officers towards
  the trade activity from one of protection of the
  domestic economy to one of facilitating
  legitimate international commerce

11
DO Promoting International Practice

• Improved business processes and automated systems
  designed to increase efficiency, and reduce
  discretion and opportunities for rent seeking
  behavior
• Modernize IT infrastructure of the SCC to
• Adopt standardized, highly automated operational
  procedures, including electronic filing of
  declarations
• Adopt e-Government facilities for information and
  interaction with the trade community
• Further develop the current self assessment
  system
• Introduce risk management as a key element of
  operations

12
DO Improving Compliance and Service

• Adopt countrywide standard highly automated
  procedures to facilitate voluntary compliance and
  reduce compliance costs
• Improve the knowledge and training of
  participants in foreign economic activities about
  the customs laws and procedures
• Improve transparency, uniformity and
  predictability of Customs actions
• Implement efficient dispute resolution procedures
• Improve enforcement capacity against smugglers
  and tax evaders through improved risk management,
  intelligence, investigation, and more efficiency
  of inspection activities, including post-release
  audit of goods and vehicles

13
DO Improving Compliance and Service

• Develop the organization of the SCC and its
  management systems to increase overall
  organizational effectiveness
• Enhance professional integrity and technical
  skills of SCC officers
• Improve the conditions for countrywide training
  and retraining of SCC officers

14
Integrity

• Customs inevitably are blamed for whatever goes
  wrong at the border
• Customs are more vulnerable to corruption than
  other comparable agencies because they have
  immediate discrete control over tangible wealth

15
Strategy to Promote Integrity

• Measures Addressing Motive
• Elite ethos and esprit de corps
• Positive career development
• High skill oriented training
• Incentives for high performance
• Stronger supervision and controls
• Sanctions for corruption
• Stakeholder surveys

• Measures Addressing Opportunity
• Clarified valuation procedures
• Automation
• Inspection based on risk analysis
• Arms-length transactions and reduction in
  discretionary authority
• Transparent clearance requirements
• Rotation of officers
• Functional organization
• Internal anti-corruption strategy and audit unit
• Stakeholder surveys

16
Risk Management

• Selectivity is at times misunderstood
• Green can mean Red
• Negative selectivity White lists
• Risk management is at the core of the project
• Automation
• Feedback
• It expands beyond cargo processing
• Fully integrated in SCC management approach
• Drives the business process and administration

17
What is important

• Commitment
• Understanding
• IT supports, it is not an end
• Job process re-assessment
• Social pact
• Performance measurement
• Pilot sites
• Regional?

• Legislation was prepared
• Focus on risk management
• IT system was upgradeable
• Mapping
• Specificity factored
• Indicators
• Corridors
• EVRAZES support

18
(No Transcript)