The project will support the construction and renovation of border crossing points (BCPs) in cases where investments to upgrade complementary facilities on the other side of the border have been completed or are nearing completion. National single windows (NSWs) alone would not be enough to achieve best results because all CAREC countries are transit countries and shipments have to cross multiple borders. This requires networking and the interoperability of NSWs at the CAREC regional level.
The project will benefit from ongoing and proposed CAREC Customs Cooperation Committee initiatives, including joint customs control, simplification of customs procedures, and the development of information and communication technology for customs modernization. Specifically, the project will focus on the following:
1. BCP improvement. The project will improve infrastructure at two road BCPs to improve working conditions and performance of border management personnel, and reduce processing time and cost:
(i) In the Kyrgyz Republic, at the Karamyk BCP, located along CAREC corridors 3b and 5, (a) the inspection facilities including customs, sanitary and quarantine, and veterinary checkpoints will be improved to handle traffic growth and improve the inspection process; and (b) power, water supply and sewerage facilities, communication facilities, and office and inspection equipment will be provided.
(ii) In Tajikistan, at the Guliston BCP, located in a key conduit of the regional Osh-Khujand highway, facilities will be upgraded and equipped, including infrastructure for vehicle inspection and two new border check posts, and water supply and sewerage facilities provided.
2. NSW development. This project will support the establishment of NSW facilities to streamline data submission to international trade regulators, and ensure conformity of submitted data with the requirements of business processes in various stages of trade and transport in the international supply chain. International standards will be adopted to ensure regional interoperability. The subcomponents of NSW facilities in the two countries include (i) single window and trade portal software development; (ii) single window backup system and hardware, regional centers, and trade portal hardware; (iii) certificate of origin and licensed track and trace of system development; (iv) operating assistance to the single window governance and working groups; (v) business process analysis and re-engineering (for up to 10 government agencies); (vi) legal and regulatory framework review; (vii) stakeholder engagement and public awareness activities; and (viii) market study and research. In terms of sequencing, a flexible software development process will incorporate possible policy and regulatory changes resulting from subcomponents (v) and (vi).
|Project Rationale and Linkage to Country/Regional Strategy
The project supports the CAREC transport and trade facilitation strategy, which aims to streamline transport, trade logistics, customs, and other border control operations to increase cross-border trade in Central Asia. From 2007 to 2009, CAREC ministerial conferences endorsed a transport and trade facilitation strategy and its implementation action plan, and a plan to address physical infrastructure needs at BCPs along priority CAREC corridors, and to establish and network NSW facilities. The goal was to develop seamless corridors to enhance economic competitiveness of the region.
BCPs are identified as the major impediments to cross-border transport and trade in the CAREC region. The CAREC corridor performance measurement and monitoring (CPMM) system indicates that in 2012 a typical 500-kilometer journey by a 20-ton truck took an average of 21.8 hours and cost $999. Delays are mainly due to poor physical infrastructure and inadequate trade logistics facilities, cumbersome customs clearance procedures, and limited utilization of information and communication technologies.
NSW facilities, which enable trade- and transport-related information and documents to be submitted only once through a single entry point, and to be reviewed and processed by relevant government agencies prior to the cargo s arrival at the border, can provide significant efficiency gains. To maximize the benefits of NSWs, coverage should be extended to include cross-border electronic data exchange. Many CAREC governments supported by business communities are designing NSWs to accommodate eventual CAREC-wide interoperability.
The benefits of good BCP infrastructure and NSWs can only be fully realized when countries on both sides of the border fund complementary investments, and border control agencies cooperate. The project supports the construction and renovation of BCPs in cases where investments to upgrade complementary facilities on the other side of the border have been completed or are nearing completion. It will help develop NSWs based on international standards to streamline trade-related procedures. The project will be implemented in coordination with ongoing and proposed CAREC trade facilitation initiatives, particularly those under the CAREC Customs Cooperation Committee, including joint customs control, simplification of customs procedures, and development of information and communication technology for customs modernization. Both governments of the Kyrgyz Republic and Tajikistan accord high priority to the project.
As landlocked countries, the Kyrgyz Republic and Tajikistan need to develop predictable and transparent trading environments, improve trade facilitation, and leverage more transit and international trade to increase competitiveness and sustain inclusive growth. By modernizing BCP infrastructure and developing electronic trade platforms like NSWs, they can improve the performance of CAREC corridors, minimize negative impacts of geographic isolation, foster more diverse economic activity, and realize their economic potential. Two road BCPs have been selected under the project: the Karamyk in the Kyrgyz Republic and Guliston in Tajikistan. The BCPs selection is based on the governments' priority, their special significance for regional trade, complementary development on both sides of the border, and minimal safeguard issues.
ADB support for regional cooperation intersects with the strategies and priorities of the project countries, particularly those related to promoting sustainable growth and improving governance. The project will help improve the environment for trade, which is an engine for economic growth and development. NSW development is consistent with the main priority of governments to improve governance, reduce corruption by increasing transparency, and ensure effective public administration by improving the capacity of the civil service.
The project is included in ADB's country operations business plan 2012-2013 for the Kyrgyz Republic, which is line with the government's medium-term development program for 2012-2014. The main goal of the development program is to improve living standards and reduce poverty by accelerating economic growth, improving the business climate, and developing an efficient governance system.
The ADB country partnership strategy for Tajikistan supports addressing the most critical development constraints and creating a basis for higher economic growth. ADB is committed to helping ensure access to efficient and cost-effective regional transport, developing new export markets, improving regional customs facilities, and facilitating regional trade. ADB's strategy is to reduce logistics costs for trade and encourage knowledge sharing between Tajikistan and other CAREC member countries to foster regional integration and facilitation. Key intended outcomes include improved regional transport connections, improved trade and transit infrastructure, and reduced cross-border barriers.