August 4, 2017
Customs workers in Vietnam perform procedures related to customs clearance. The business environment is being improved by a new system
The Association of Southeast Asian Nations got a new start as the ASEAN Community on Dec. 31, 2015. All member countries are aiming to abolish tariffs in the region by 2018 and develop further as one giant community.
In parallel with the bilateral cooperation it has been carrying out, JICA is working to enhance regional cooperation with stronger connectivity in mind. One example of this activity is customizing for various countries an original Japanese IT system for customs in an effort to smooth trade. Modernizing customs is essential to the growth of ASEAN*1.
With support from JICA, Viet Nam Automated Cargo and Port Consolidated System (VNACCS/VCIS), an IT system for customs, has been adopted by all 33 customs offices in Vietnam.
Since Vietnam joined the World Trade Organization (WTO) in 2007, direct foreign investment has rapidly increased, as have export and import declarations, going from 1.16 million in 2002 to 4.16 million in 2010. This has led to an earnest desire for a more efficient customs procedure. The latest in Japanese technology has made this desire a reality.
Japanese cooperation to build a new electronic customs clearance system
After JICA received a request from the General Department of Vietnam Customs, custom versions of the Nippon Automated Cargo and Port Consolidated System (NACCS)*2 and the Customs Information System (CIS)*3 were created for Vietnam. These original Japanese systems speed up customs procedures. JICA began providing assistance to Vietnam to adopt the systems — dubbed VNACCS/VCIS — in March 2012.
Making declarations through a customs clearance contractor using VNACCS
"Customs processing with a simple inspection used to take about 15 minutes, but with VNACCS, it can be completed in just 1 to 3 seconds. … We achieved a saving of 100 hours and twelve thousand U.S. dollars per month."*4
JICA heard from not only Vietnamese companies, but also from Japanese companies expanding into Vietnam, how glad they are about the new efficiencies. ASEAN is aiming for even more connectivity in the region through more efficient and modern customs procedures, and JICA providing assistance to Vietnam as it fulfills its duty as a member country.
When introducing the system, JICA carried out a technical cooperation project for human resource training because there was a need to inform people about the new system, explain it and engage in scrupulous study and preparation while reconsidering existing regulations and work processes in the field of customs. Currently 66,000 exporters and importers use the VNACCS/VCIS system, and it has become possible for 99 percent of import and export declarations to be made through the system.
Yangon international airport customs, which has yet to be brought into harmony with international logistics practices
Support for introduction of the system in Vietnam led JICA to support its introduction in Myanmar as MACCS/MCIS. Myanmar was quite late among ASEAN countries in improving its customs system. Mutual learning is taking place across borders. To give one example, Vietnam's experience gained through introducing and operating the system is being shared with people involved in customs in Myanmar.
In addition, JICA's dispatching of experts on customs to various countries has led to the modernization of customs in each and a quicker smoothing of trade in ASEAN. In addition to Vietnam and Myanmar, JICA has sent experts to Laos, Cambodia, the Philippines, Indonesia, Malaysia and Thailand.
There are now more than 10,000 Japanese companies doing business in ASEAN, which is known as "the world's factory." The customs assistance through IT that JICA is carrying out is expected to not only increase connectivity in ASEAN, but also to benefit the world economy.
*1 ASEAN was established in 1967 by Indonesia, Singapore, Thailand, the Philippines and Malaysia. Brunei joined in 1984, and today there are 10 member countries.
*2 This is a system for online processing of customs and other procedures for government agencies and related public work, with regard to ships and aircraft that enter and leave the country and imported and exported cargo.
*3 This information system for the uniform management of information on imports, exports and ships entering and departing ports, is used for customs inspections.