Dangerous Goods and Special Cargoes Section

1

• UNECE Trade Commission. 5th session.
• Priority needs in trade facilitation, regulatory
  cooperation and agricultural development in
  Kazakhstan
• Geneva, Switzerland
• 18 June, 2012

Oleg Samukhin Samukhin_at_MSN.com
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Business Process Analysis

• Business Process Analysis helps pinpoint
  particular problems faced by Traders
• Two Large Exporters were selected
• Producer of Candies and Biscuits
• Producer of Flour, Pasta and Biscuits
• Companies have operations in 2 different corners
  of the country, which results in regional
  differences in
• Speed of control
• Arrangement of transport

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Scope of BPA study in Kazakhstan
Products Export markets Export markets Modes of transport Modes of transport Modes of transport Trade financing
Products CIS FTA Non-CIS Rail Road Other Trade financing
Flour ? ? ?
Pasta ? ?
Biscuits ? ?
Candies ? ? ? ?
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Core Business Processes and Stakeholders in
export by Rail
For all shipments
Not for all shipments
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Core Business Processes and Stakeholders in flour
export
Chamber of Commerce Customs Customs Broker Exporter Exporters Bank Freight Forwarder Importer Importers Bank Phytosanitary Inspection Railways Rail car Operator
1. BUY
1.1. Negotiate sales contract ? ?
2. SHIP
2.1. Arrange transport ? ? ?
2.2. Get the Certificate of Origin ? ?
2.3. Obtain Phyto Certificate ? ?
2.4. Load Transport ? ? ?
2.5. Pay for Transport ? ? ? ? ?
2.6. Do Customs Clearance ? ? ? ?
2.7. Ship goods and documents ? ?
3. PAY
3.1. Open transaction certificate ? ?
3.2. Pay for goods ? ? ? ?
3.3. Close transaction certificate ? ?
Stakeholders
Processes
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Core Business Processes and Stakeholders in
export by Road
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Core Business Processes and Stakeholders in
export by Road
Chamber of Commerce Customs Customs Broker Exporter Exporters Bank Importer Importers Bank Road Operator
1. BUY
1.1. Negotiate sales contract ? ?
2. SHIP
2.1. Arrange transport ? ?
2.2. Get the Certificate of Origin ? ?
2.3. Obtain Phyto Certificate ?
2.4. Load Transport ? ? ?
2.5. Pay for Transport ? ? ?
2.6. Do Customs Clearance ? ? ? ?
2.7. Ship goods and documents ? ?
3. PAY
3.1. Open transaction certificate ? ?
3.2. Pay for goods ? ? ? ?
3.3. Close transaction certificate ? ?
Stakeholders
Processes
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Use Case Diagram.Export by Road to the EU
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Use Case Diagram.Export by Railto the CIS
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Modes of Land Transport in Export-Import
operations
Mode Main use
Rail Export of minerals Export to Central Asian Republics Transport of low value goods to/from Russia
Road Import-export of consumer goods, equipment, food from/to the EU Import of consumer goods from China Import-export to/from Kyrgyzstan and Tajikistan (bi-passing Uzbekistan)
Pipeline Oil Gradually replacing rail deliveries in tank cars
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Trade flows. Export
Oil, metals, grain
Oil, metals, grain
Astana
st. Dostyk
Khorgos
Fuels, grain, flour
Kordai
st. Lugovaya
st. Sary-Agach
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Trade flows. Import
Equipment, consumer goods, food
Consumer goods, food, equipment
Astana
st. Dostyk
Khorgos
Agricultural products
Kordai
st. Lugovaya
st. Sary-Agach
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SHIP Arrange Rail Transport

• Rail cars not always available gt delays or lost
  sales
• Private wagons are more expensive gt loss of
  profit
• Rail companies not always acknowledge bookings,
  Traders have to get what is available

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SHIP Obtain Certificate of Origin

• Chambers of Commerce do thorough examination once
  a year, but
• Certificates have to be issued for every shipment
• One company spends days, the other hours for
  obtaining CoOs

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Business Process.Obtain Phytosanitary Certificate

• It is needed for Flour export
• It takes 3 steps in 3 different locations
• But 3 steps take only few hours
• Certificates are mostly received based on the
  Producers lab reports

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SHIP Load, Pay, Ship cargo and documents

• Rail cars have to be checked and repaired by
  Traders
• Payment for services of foreign Rail companies
  have to be done through freight forwarders

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SHIP Do Export Customs Clearance

• Declarations are prepared electronically, but
  must be printed and stamped
• Payment for declarations are in EUR, which is not
  always convenient for Traders

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Time-procedure Chart Export of Candies

• Getting Certificate of Origin sometimes can be
  the critical path activity

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Export of Flour, Pasta

• Time to Arrange transport cannot be forecasted
• The whole process duration depends on
  availability of rail wagons
• Export procedures take only one day

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Road crossings between Customs Union and the EU

• Export to the EU is done by road transport
  through Russia
• Queues up to several days at the borders
• Excessive control on Customs Union BCPs
• Risk Management is not duly applied

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Recommendations

• Border Crossing by Road should be facilitated
  through use of Risk Management systems and full
  implementation of relevant Transport Conventions
  (TIR and Harmonization Convention 1982)
• Rail transport is important for export of Kazakh
  products and needs reforms
• Simplification of procedures for certificates and
  permits and electronic single window is very
  important for exporters and critically important
  for importers

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Specific Recommendations

• Phytosanitary certificate
• Eliminate unnecessary steps
• Issue certificates on the basis of periodic
  inspections of Producers production and
  management systems and Producers laboratory test
  results
• Implement electronic submission of documents

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Specific Recommendations

• Certificate of Origin
• Within CIS allow both the certificates issued for
  a particular shipment (like it is done now) and
  periodic certificates for a particular product
  (such certificates can be copied and added to
  shipments the same way as the Certificates of
  Conformity)
• Simplify documentary requirements and reduce time
• Prepare CoO on basis of periodically submitted
  data. Implement electronic Certificates

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Specific Recommendations

• Customs clearance
• Collect customs fees in national currency
• Consider waiving fees for selected list of
  exported goods
• Currency control
• New law eliminated one document, but did not
  eliminate the procedure
• New regulation (will become effective since 1
  July 2012) imposes similar requirements of
  traders as the previous one
• These requirements may need further revision

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Specific Recommendations

• Payments and Trade Financing
• Although use of trade financing instruments is
  the importers decision, Exporting country can
  promote their use and benefit from increased
  trade
• Letters of Credit and other trade financing can
  be promoted through banks, professional
  associations, freight forwarders, etc.

26

• UNECE Trade Commission. 5th session.
• Priority needs in trade facilitation, regulatory
  cooperation and agricultural development in
  Kazakhstan
• Geneva, Switzerland
• 18 June, 2012

Oleg Samukhin Samukhin_at_MSN.com