Chronicle Editor
Prosper Ndlovu, Analysis
SIMPLIFIED customs procedures, eliminating fraud, reduced cost of doing business and improved record management are some of the top value benefits of embracing digital technologies towards enhanced trade facilitation.
Over the years, exporters, importers as well as trade authorities heavily relied on manual processing of key documents, clearance and verification, which is prone to delays and inefficiencies.
With the adoption of electronic (e) commerce approaches, trade facilitation and general buying and selling is becoming easier and more seamless.
Technology absorption is also helping simplify complexities associated with Rules of Origin provisions, which in themselves are essential in determining the amounts of customs duties and taxes to be applied on goods, in parallel with customs classification and assessment.
Their importance is derived from the fact that duties and trade restrictions in several cases depend upon the source of imports.
The World Customs Organisation (WCO) defines Rules of Origin as “the specific provisions applied by a country to determine the origin of goods and using principles established by national legislation or international agreements.” (Revised Kyoto Convention).
A distinction is made between two systems of origin, which are: “preferential”, where everything is based mainly on bilateral or multilateral agreements (free-trade agreements (FTAs), customs unions, free-trade areas, and so on, and “non-preferential”, whereby each country applies its own rules even if they can be harmonised within some regional economic unions.
Under the Rules of Origin framework, millions of Certificates of Origins are issued every year around the globe to facilitate trade and commerce.
According to the International Chamber of Commerce (ICC), a Certificate of Origin (CO) is an “important international trade document that certifies that goods in a particular export shipment are wholly obtained, produced, manufactured or processed in a particular country”.
In essence, COs declare the “nationality” or source of a product being traded and also serve as a declaration by the exporting company or individual to satisfy customs or trade requirements.
Normally COs are requested by customs, banks, private stakeholders and importers for several purposes and often all countries require these for customs clearance procedures.
The facility is critical in determining the duty that will be assessed on the goods or, in some cases, whether the goods may be legally imported at all.
Closer to home, the Zimbabwe Revenue Authority (Zimra) provides for preferential rates of duty applicable to a wide range of goods originating in specified countries.
This is done in terms of trade and customs agreements and/or by suspensions of duty, which apply to certain goods originating in these countries.
Actually, Section 25 of the Customs and Excise (General) Regulations Statutory Instrument 154 of 2001 requires importers to obtain Certificates of Origin completed and signed by their suppliers or the manufacturers of the goods concerned and produce them in support of any reduced rates of duty that are being claimed in respect of imported goods because of their origin.
Some of the prescribed certificates are listed in the First Schedule Part II to the General Regulations.
In that regard, the Southern African Development Community (Sadc) must be commended for taking an important step towards enhancing seamless flow of intra-regional trade following the launch of the electronic Certificate of Origin (e-CoO) in Blantyre, Malawi, early this month.
Rolling under the theme: “Enhancing trade facilitation through the SADC Electronic Certificate of Origin,” the recently launched e-CoO is intended to address the challenges encountered with the use of manual CoO by simplifying customs procedures, enhancing e-Commerce, eliminating fraud, improving record management and statistical data, reducing cross-border certificate verification time as well as reducing the cost of doing business.
The e-Certificate of Origin is one of the milestones of the Trade Facilitation Programme (TFP), which is supported by the European Union and GIZ under the “Co-operation for the Enhancement of Sadc Regional Economic Integration” Programme.
The intervention provides for capacity-building and technical assistance in border cooperation by ensuring the implementation of Sadc Co-ordinated Border Management Guidelines and provisions of the World Trade Organisation (WTO) Trade Facilitation Agreement, particularly on improving the efficiency of their operations.
This is expected to go a long way in supporting the implementation of Sadc Industrialisation Strategy and Roadmap (2015-2063) and is in line with the Regional Integration Agenda, as outlined in the Regional Indicative Strategic Development Plan (RISDP 2020-2030), as well as the consolidation of the Sadc Free Trade Area (FTA).
Commissioner General of the Malawi Revenue Authority, Mr John Biziwick, who witnessed the launch has said the e-Certificate of Origin will improve the way business is conducted in the region by eliminating challenges associated with manual processing.
Under the electronic system, manufacturers, producers and exporters will be allowed to electronically register their products for preferential treatment and apply for COs whenever there is an export shipment.
The introduction of the Sadc e-Certificate of Origin will, thus, increase the seamless flow of trade across the Sadc region by eliminating impediments caused by the manual process, he said in a post-launch brief shared by the Sadc Secretariat.
Director of Finance, Investment and Customs at the Sadc Secretariat, Mr Sadwick Mtonakutha, said implementation of the e-CoO is a notable milestone for the bloc to keep pace with the rapid shift to e-Commerce, the drive to foster industrialisation and improve efficiency in serving the business community.
He highlighted that it was in the best interest of the public and private sectors in the Sadc region to push for ownership and implementation of the e- CoO in Member States owing to the many benefits that it presents to assist in facilitating trade.
With the introduction of the e-CoO, Mr Mtonakutha says small to medium enterprises (SMEs) would benefit more from reduced transaction costs, access to better financing terms, improved cashflow, and increased efficiency of business operations.
For the logistics operators, he suggests that operators would improve operational efficiencies and real-time connection, while customs administrations are set to benefit from automated risk management, better fiscal evaluation and speedier goods clearance.
Mr Becerra Marta Jose Angel, Deputy Head of Co-operation at the World Trade OrganisationEU) delegation to Botswana, said the launch of the e-CoO represents a new step of the EU long-standing partnership with Africa on economic integration and trade matters.
He pledged EU’s commitment to continue working with Sadc to effectively implement the e-CoO and to build on the strong partnership in boosting sustainable economic growth and trade on the African continent.
With the coming in of the African Continental Free Trade Area (AfCFTA) Agreement into force, Mr Angel said this provides an opportunity for countries to think beyond the traditional approach to products originated nationally, towards products “originated in Africa”.
Representative of the German Development Co-operation and technical advisor for GIZ Botswana and Sadc, Mr Healey Mweemba, described the launch of Sadc e-CoO as an important milestone on the road towards implementation of the Sadc Trade Facilitation Programme.
He added that his organisation was committed to supporting trade facilitation because of the immense benefits that can be collectively achieved once fully and effectively implemented.
Mr Mweemba said a lesson from the Covid-19 pandemic is that countries should leverage on technology to modernise the way they trade.
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