CHAPTER ONE

GENERAL INTRODUCTION

INTRODUCTION

In recent years, there has been a positive trend for anti-corruption initiatives to be introduced as part of wider reform and modernization programs based on internationally accepted world customs organization (WCO) and World customs organization (WTCO) Standards. reform efforts typically focus on reengineering systems and procedures to simplify and improve custom procedures at the Douala Seaport. Cameroon customs had been working for years, but the director general was not satisfied with the progress and thus opted for a new reform in the custom sector. Thus this projects seek to examine these new trends and their effects at the doula seaport.

All goods imported into Cameroon has to pass through the customs procedure for proper examination, appraisal, assessment and evaluation.

• Background of the study

Many Customs administrations have suffered from corruption and struggled to identify options for ameliorating this malady. In seeking to reduce corruption, while simultaneously strengthening performance (such as raising revenue collection and enhancing trade facilitation), policymakers should conduct experiments that can assist in identifying constructive policies. Such an experiment has been tested for Cameroon Customs, with some preliminarily positive results. In 2007, Cameroon launched a reform of its Customs administration, which included the installation of ASYCUDA (an automated Customs clearance system). In February 2010, as a continuation of the reform, Cameroon Customs introduced a system of performance contracts signed between the Director General and a number of front-line officers in the port of Douala. The core of the performance contracts is an agreement that the practices of the customs officers will be recorded and reported to the Director General. After four months of their implementation, initial results are encouraging (including lower corruption, higher revenue collection, and shorter clearance times) and may point to the birth of a new professional culture. The above changes of customs procedures at the Douala seaport are implemented on imported products into the country, thus its essential to dig into the extent to which this move will affects importation at the Douala seaport This paper focuses on the investigation and understanding of the new trends in customs and effects on importation, and suggests that replication may be beneficial for other Customs administrations and importers at the Douala seaport.

Customs administrations perform broad, important functions that facilitate the flow of goods and services across international borders. Traditionally, customs have played a somewhat narrow role, focused primarily on the collection of duties and taxes on imported goods. In the United States, for example, revenue collected by the U.S. Customs Service (USCS)—now the Bureau of Customs and Border Protection (CBP)—was a significant source of income for the U.S. economy before the establishment of the federal income tax system. Over time, the role of USCS expanded so that, in addition to revenue collection, it became responsible for ensuring the legitimacy, safety, and security of goods admitted into the United States. Currently, CBP carries out this responsibility, in conjunction with other U.S. government agencies, through its enforcement of a range of trade laws, including those concerning tariff collection, compliance with sanitary and phytosanitary standards, and the protection of intellectual property rights. More recently, CBP, like other customs administrations worldwide, has been asked to take on the role of trade facilitator. This role requires the CBP to adopt specific practices that allow imports into the United States to clear customs checkpoints more efficiently. These improved practices are also being adopted by other countries and advanced under both the World Customs Organization (WCO) and the World Trade Organization (WTO), as discussed later in this article. In many developing countries, however, customs agencies are still seen principally as tax collecting entities, even as trade promotion is acknowledged as increasingly vital to these countries’ economic growth.4 The cost of trade activity in developing countries is estimated to be 1.8 times higher, on average, then in developed countries.

1.1.1 The evolution of customs trends.

Not everyone in Douala celebrated 1 January 2007. On that day, the head of the IT Division of Cameroon Customs became, in the eyes of his colleagues and of freight forwarders, the main agent of a mini revolution: by disconnecting the PAGODE5 computerized customs clearance system, he put an end to 20 years of sometimes tormented history of a software system which processed 90% of customs revenue. The following day, not without some apprehension, he launched Customs activities on ASYCUDA, a system developed by UNCTAD. This seemingly exclusively IT switchover was, in reality, the culmination of an opportunity taken over the previous eight months to prepare a reform of customs procedures.

The globalization of supply chains, the expansion of just-in-time (JIT) manufacturing, and the growth of e-commerce have stimulated efforts toward customs reform. At present, more than half of all goods that cross international borders are intermediate goods, reflecting the geographic fragmentation of production networks and an increase in vertical specialization.9 Intermediate inputs account for a large share (more than 50 percent) of participation in global value chains by the United States, as well as by many other countries, whether members of the Organization for Economic Co-operation and Development (OECD) or not. JIT manufacturing means that these intermediate parts must arrive at the next point in the global value chain within a tight deadline.  In addition, business-to-business, business-to-consumer, and consumer-to-consumer e-commerce have boosted demand for faster, more efficient customs clearance procedures. According to estimates by UNCTAD, business-to-business e-commerce accounted for $15 trillion in revenues in 2013, and business-to-consumer e-commerce for $1 trillion. The latter development is largely but not entirely accounted for by e-commerce transactions. A fourth trend is growing regional economic integration, especially in the form of free trade agreements (FTAs), customs unions, and trade (or transit) corridors. In general, FTAs and customs unions are designed to liberalize market access for participating countries by removing trade barriers, including customs barriers, while trade corridors are developed to facilitate trade between landlocked countries and their coastal neighbors. 15 According to the World Trade Organization (WTO), at the start of 2017 there were 238 FTAs and 19 customs unions in force that had been notified under the General Agreement on Trade and Tariffs (GATT).16 Countries that are a party to these agreements aim to harmonize customs procedures and regulations. Customs unions, in particular, are formed between countries that share borders, and these agreements require member countries to coordinate border management policies. In addition, members of customs unions develop a common external tariff that applies to trade with third-party countries, whereas trade among customs union members is duty free. By contrast, trade corridors focus on upgrading transport infrastructure; however, they are most effective when accompanied by improvements in customs efficiency.

1.2 Statement of problem

Adopting modern, simple procedures. Customs administrations must cope with a wide range of special issues. Custom clearance of goods imported by sea often becomes challenge. Incorrect classification or packaging of goods puts the consignment t risk of not reaching the recipient and the complexity of the documentation to be completed requires accuracy and fair amount. Goods arriving at the Douala seaport usually takes several months to be released to the recipients thus it was very necessary to reform the customs proceeding for imported goods into Cameroon. Many Customs administrations have suffered from corruption and struggled to identify options for ameliorating this malady.

Ports play a fundamental role in a sustainable importation of products into Cameroon. Importers, shipping agencies and government face high cost for sea transport and substantial inefficiency in port operations. This has resulted to increase in ship dwell time and accumulation of goods and many importers for clearance of their products, thus causing the custom Director to think for new trends in customs.

The customs activity in Cameroon has met a lot of hindrance from the local population and business people who offend import or export goods out of the country. some people try to manipulate and evade the tax system. While the custom tries to adopt new trends to combat this population. Therefore, its very relevant to carry out a research on these new trends and its impact.

• RESEARCH OBJECTIVES

1.3.1 Main Objectives

The purposed of this research is to investigate, the new trends in customs and its effects on importation case study the Douala Seaport.

1.3.2 Specific objective

– To identify the various new trends in customs adopted for the importation process at the Doula seaport.

– To investigate the effects of changes in customs regulation on importation at the Douala seaport.

-To examine the effects of the digitalization and computerization of customs on the importation. 

-To investigate the challenges face by importers due to the custom’s new trends in the implementation of the new trends.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   1.4 Research questions:

-What are the new trends of custom place on importation at the Douala seaport?

– what are the effects of the changes in custom’s regulation on imports at the Douala seaport?

-what are the effects of digitization and computerization of customs procedure on imports?

– What are the challenges face by the importers due to the changes in the new trends of customs at the Douala seaport?  trends?

1.5 Research hypothesis

HO1 There is no significant effect of customer’s changes in regulation on imports at the Douala seaport.

HO2 there is no Significant effect of the launch of the digitalization and computerization policy on importation in Cameroon

HO3 there exist some challenges face by customs in the implementation of the new trends systems.