Regional: Strengthening Trade Facilitation in the GMS through Partnerships with the Private Sector

Sovereign Project | 46191-001 Status: Approved

Summary

Facilitating cross border trade in the Greater Mekong Subregion (GMS) is essential to ensure the transformation of existing transport corridors into economic corridors. The GMS Economic Cooperation Program Strategic Framework 2012-2022 (GMS Strategic Framework) has prioritized the development of the major GMS transport corridors into economic corridors, and emphasizes that improvements in transport and trade facilitation are essential to the transformation process. GMS Customs administrations are responsible for the clearance of goods at border crossings and play a critical role in trade facilitation. Currently, there are efforts focused on modernizing, streamlining and harmonizing complex customs and other trade-related procedures and documentation requirements which, taken together, impose significant transaction costs on the private sector involved in cross border trade.

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Project Name Strengthening Trade Facilitation in the GMS through Partnerships with the Private Sector
Project Number 46191-001
Country Regional
Project Status Approved
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 8707-REG: Strengthening Trade Facilitation in the GMS through Partnerships with the Private Sector
Japan Fund for Poverty Reduction US$ 1.50 million
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Governance and capacity development
Knowledge solutions
Partnerships
Private sector development
Sector / Subsector

Industry and trade - Industry and trade sector development - Trade and services

Gender Equity and Mainstreaming No gender elements
Description

Facilitating cross border trade in the Greater Mekong Subregion (GMS) is essential to ensure the transformation of existing transport corridors into economic corridors. The GMS Economic Cooperation Program Strategic Framework 2012-2022 (GMS Strategic Framework) has prioritized the development of the major GMS transport corridors into economic corridors, and emphasizes that improvements in transport and trade facilitation are essential to the transformation process. GMS Customs administrations are responsible for the clearance of goods at border crossings and play a critical role in trade facilitation. Currently, there are efforts focused on modernizing, streamlining and harmonizing complex customs and other trade-related procedures and documentation requirements which, taken together, impose significant transaction costs on the private sector involved in cross border trade.

While improvements in Customs operations and services can help to facilitate cross border trade, greater engagement with the private sector is also essential for facilitating trade. The GMS Business Forum (GMS-BF) pointed out at the third GMS Economic Corridors Forum in June 2011 that there is a need for greater inputs from the private sector on how best to facilitate cross border trade. The GMS Freight Transport Association (GMS FRETA) was established as a subsidiary body of the GMS-BF in 2012 to enable the trade-related private sector to identify issues and solutions concerning cross-border trade in the GMS. Considering that the private sector is the primary engine for trade activities, the private sector is a key source of practical means and measures to facilitate trade. The trade-related private sector can help to identify bottlenecks to border trade, define realistic targets for improvement, and propose practical solutions for simplifying and streamlining trade regulations, procedures, and documentation to import and export goods.

Customs administrations have also come to understand the importance of promoting private sector participation and partnerships in trade-related supply chains. One such partnership is the Authorized Economic Operator (AEO) scheme, under which compliant traders can utilize simplified Customs procedures. However, certain segments of the private sector, especially small-and-medium-sized enterprises (SMEs), are usually less aware of Customs procedures, regulations and standards. This also hampers the access of SMEs to regional and global markets. Customs administrations need to employ more effective public relations strategies to reach out to the private sector, particularly SMEs, in order to provide them with necessary and timely information, and help them better understand and comply with the Customs requirements.

Project Rationale and Linkage to Country/Regional Strategy The objective of the R-PATA is to promote greater dialogue and partnership between Customs administrations and the trade-related private sector in the 5 GMS countries in order to identify and remove constraints to cross border trade. More efficient trading of goods across GMS border crossings will contribute to economic corridor development.
Impact Partnerships are forged between customs administrations and the trade-related private sector, thereby facilitating the cross-border movement of goods along economic corridors.
Project Outcome
Description of Outcome Established or strengthened schemes and measures for customs administrations to better coordinate with the private sector for more effective trade facilitation
Progress Toward Outcome Project implementation has been initiated in Myanmar and Viet Nam, while consultation with other participating countries is ongoing.
Implementation Progress
Description of Project Outputs

Trade facilitation constraints and solutions are identified via surveys of the trade-related private sector.

Capacity and procedures of customs administrations improved to enable more effective partnership and engagement with the trade-related private sector

Status of Implementation Progress (Outputs, Activities, and Issues)

1. Trade survey was conducted in Myanmar, and the report is in progress. Based on the survey findings, a work program has been agreed with Myanmar Customs to undertake relevant measures to improve trade facilitation. Similar surveys are planned for other participating countries as appropriate.

2. Capacity building programs for trade-related private sector, Customs officers and Other Government Agency officials to strengthen their understanding and coordination to facilitate international trade supply chains are identified and developed, including possible training, testing and licensing schemes for Customs brokers.

3. The development or strengthening of Authorised Economic Operators (AEO) schemes are being planned, with complementing capacity building programs to be delivered to ensure their efficient and effective implementation.

Geographical Location
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design Various consultation with Customs administrations in partcipating countries were undertaken.
During Project Implementation Initial consultation with Customs administrations, trade ministries and related stakeholders were conducted in 2014 - 2015 to identify and refine the scope of project activities in 2015-2016.
Business Opportunities
Consulting Services A total of 106 person-months of consultancy services will be engaged consisting of 21 person-months of international consultancy and 85 person months of national consultancy. International consultancy inputs consist of 16 person-months for a Team Leader and Customs Specialist and 5 person-months for resource persons. National consultancy inputs consist of 65 person-months for 5 Trade Facilitation Country Specialists and 20 person-months for a Project Administrator.
Responsible ADB Officer Hung Nguyen
Responsible ADB Department Southeast Asia Department
Responsible ADB Division Regional Cooperation and Operations Coordination Div, SERD
Executing Agencies
Asian Development Bank
6 ADB Avenue, Mandaluyong
Metro Manila, Philippines
P.O. Box 789, 1099 Manila,
Philippines
Timetable
Concept Clearance 18 Jan 2013
Fact Finding 12 Jul 2013 to 18 Jul 2013
MRM -
Approval 22 Aug 2014
Last Review Mission -
Last PDS Update 22 Sep 2015

TA 8707-REG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
22 Aug 2014 - 22 Aug 2014 31 Aug 2016 - -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
0.00 1,500,000.00 0.00 0.00 0.00 0.00 1,500,000.00 22 Aug 2014 391,019.56

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