New customs system to reduce cost of doing business

Finance Minister Pravin Gordhan introduced a new-look customs systems aimed at reducing the cost of doing business, boosting the country’s competitiveness and exports, and promoting inter-regional trade.
Briefing journalists at the SA Revenue Service (SARS) custom’s offices in Woodmead, north of Johannesburg today, 22 August, Gordhan said the new-look modernised system has already been implemented.  Early indications are that it has more than halved the time it takes to move goods across borders.
The new system comes on the back of several reports, including a 2010 study by the World Bank, that found customs procedures stationed at border posts were inefficient and hiked the cost of moving goods across borders – a major obstacle to regional integration.
“The new customs management system centralises the clearing of all import and exports declarations using a single processing engine. The new automated management system replaces a variety of older systems and paper-based, manual administrative processes.
“By managing customs declarations and supporting documents in electronic format, the processing of cargo movements by land, sea and air will now be much quicker and more accurate,” Gordhan said.
The new system, which the Minister also said would curb cross-border corruption, started out as an international project aimed at devising a standardised system that will be interfaced at all border posts in the Southern African Development Community (SADC) and other regions in Africa, aimed at promoting trade.
The National Development Plan (NDP), which has been endorsed as a policy by government and business, calls for a framework to be put in place to put the country’s economy onto a new trajectory, with a strong emphasis on lowering the cost of doing business in SA, improving competitiveness and exports, and linking the country’s products with other economies.
Gordhan said the new system was already in line with the requirements of the NDP.
“The NDP targets an increase in intra-regional trade in Southern Africa from 7% to 25% of trade by 2030, and that South Africa’s trade with regional neighbours should increase from 15% of the total trade to 30%,” he said.
At a recent Africa Infrastructure Conference, Public Enterprises Minister, Malusi Gigaba, said for all African regions to trade effectively, there was a need to reduce regulatory red-tape that made it difficult for countries to do business.
Gordhan’s announcement will, on top of reducing the cost of doing business, help SARS to automatically detect false declarations and boost revenue, a move that will also boost the economy. “The new customs management system will have significant benefits for importers, exporters, clearing agents and trade facilitators, and will make our economy and commercial trade more competitive globally,” he said.
Business is set to cash in as a result of the new system being implemented, and Gordhan said it would reduce the use of paper for end-to-end processing and declarations by 95%. Declarations would be digitised, with the introduction of mobile inspections through iPads, and supporting documentation will no longer be required, unless in a case of a risk identification.
When the old system was used, it took customs officials about four to eight hours to inspect goods. Now physical inspections will only take an average of two hours.

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