November 22, 2017 19:52

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Vietnam Customs Efficiency Improvement: Major driven factor of trade facilitation in 2016

10:03 | 05/02/2017

Vietnam is one of the most Enabling Trade Index-improved countries in the Global Enabling Trade Report 2017 of World Economics Forum that is an annual international publication on trade facilitation and development.

vietnam customs efficiency improvement major driven factor of trade facilitation in 2016
Quang Ninh Customs.

This is a significant capacity to enable trade of Vietnam that resulted in climbing 14 ranks to position of 73rd among 136 countries in 2016. Together with a variety of international trade records, nowadays Vietnam is known as a successful story of trade liberalization and globalization (World Economics Forum, 2017).

The most contributed factor is border administration with strongly improved customs efficiency (now at 66th) which cut down times for documentary and border compliance for both exporting and importing approximately 30 hours (see table 1). These changes integrate a wide range of innovations and efforts of the Vietnam’s Government and Customs to reinforce multiple border agencies cooperation, streamline procedures and reduce burden of inspections at border gates.

Table 1: Time and costs of customs clearance for exporting and importing of Vietnam in 2015 and 2016

SEQ

Content

Unit per 01 shipment

2016

2015

1

Time of documentary compliance for exports

hour

50

83

2

Time of border compliance for exports

hour

58

57

3

Cost of documentary compliance for exports

USD

139

139

4

Cost of border compliance for exports

USD

309

309

5

Time of documentary compliance for imports

hour

76

106

6

Time of border compliance for imports

hour

62

64

7

Cost of documentary compliance for imports

USD

183

183

8

Cost of border compliance for imports

USD

392

268

(Source: World Bank, Doing business 2016 and 2017)

To be a key driven force in the WTO’ s Trade Facilitation Agreement negotiation and ratification of Vietnam (done on 15th December, 2015), the GDVC are substantially fostering harmonization, standardization and modernization which creates an achievement of moving up 16 ranks to 86th in the world.

In addition, the report points major bottlenecks and weakness of Vietnam in enabling and facilitating trade that requires this developing country to reduce sharply when TFA comes into force in early 2017. Inherently, burdensome customs procedures, tariff and non-tariff barriers, and corruption at the borders are top concerns of trade community in Vietnam. Furthermore, the OECD Trade Facilitation Indicators 2015 also revealed that Vietnam needs to focus on some principal milestones of trade facilitation which are involment of trade community; fees and charges; and external border agency cooperation.

Full report found here: https://www.weforum.org/focus/global-enabling-trade-report-2016?delete_local=40

By Phan Hien, Khanh Hong