CHAPTER ONE

GENERAL INTRODUCTION

1.1 Background to the study

Countries trade with other countries due to differences in comparative advantage, resource endowment, taste and technology. These differences create disequilibrium between supply and demand for goods and services among citizens of different countries, while e-trade has a tendency to restore equilibrium (Magri, 2010).

The evolution and the growth in international trade is very intensive in the last two decades. Many economies recognized that the trade play major role in the economic growth (Milorad et al, 2017). The roles of customs are: protection of financial interests, protection and improvement of international trade, protection of society, etc. Customs clearance is the most important factor in international trade. Country competitiveness is result of customs service efficiency and effectiveness (Zamora et al., 2013). Due to losses in time, the changes in customs operations are necessary for easier crossing the border. Efficient customs operations are prerequisite for faster supply chain.

However essential it remains in all countries with a value- added tax (VAT) system, and especially in developing countries, the collection of taxes on imports is today only one of the facets of the role of customs. This role has also taken on economic and societal dimensions and confronts many major global challenges. The problem of measuring efficiency in public sector is more complex than efficiency measuring in private sector. The main problem in efficiency measuring in public sector is identification of relevant inputs and outputs (Benazić, 2012). Organizational changes in customs influenced the efficiency of customs services.

Globally, cross-border smuggling of food commodities is on the increase and the war on smuggling of these commodities has remained a tough one due to the complexity of border formalities (World Bank, 2013). For instance, as stated by Miroff (2016), cross border smuggling of food commodities thrives along the Cameroon border through Tiko town.

In the developed world automation and technology integration play a crucial role in enhancing customs efficiency and reducing smuggling. The implementation of automated systems and technology streamline processes, improve risk assessment capabilities, and facilitate information sharing among different agencies (WCO, 2017). Additionally, robust risk management strategies and intelligence gathering are essential in targeting high-risk shipments and detecting smuggling attempts. Risk assessment techniques, such as data analysis, profiling, and targeting, enable customs authorities to allocate resources effectively and focus on suspicious consignments. For example, the U.S. Customs and Border Protection (CBP) utilizes intelligence-driven approaches to combat smuggling and protect national security (CBP, 2016). These factors collectively contribute to more efficient customs processes and a stronger fight against illegal movement of goods in from South America into the US (McDonald, 2011).

In the less developed world, several customs efficiency factors play an important role in combating smuggling of goods. For instance, the implementation of modern technology and automation systems significantly enhance customs processes and reduce opportunities for illicit activities (UNCTAD, 2016). Strengthening inter-agency cooperation and information sharing between customs authorities, law enforcement agencies, and relevant stakeholders is vital for effective smuggling prevention (WCO, 2019). However, there are several challenges that hinder customs efficiency and the fight against smuggling of goods. Limited resources and infrastructure pose significant obstacles, affecting the ability to invest in modern technology and automation systems (World Bank, 2019).

In Africa, smuggling is common due to the weak cross border enforcement (Golub, 2015) and this has made this type of trade to thrive everywhere in Africa (USAID, 2010). In East Africa Community (EAC), cross-border smuggling of food commodities in EAC directly or indirectly escape from the regulatory framework and often go unrecorded or incorrectly recorded into official national statistics of the trading countries (Little, 2007).

In Cameroon, socio-political and economic changes in last years of the modern history of Cameroon, along with the democratization of public life led to the development of economic processes that seriously complicate the normal development of society. Thus, the liberalization of foreign economic activity, which in the early 1990s contributed to the process of opening the Cameroon economy to the world market, inevitably led to the renewal of criminal relations in the sphere of foreign economic activity and maritime domain (Sirri, 2023). It is significant that in most cases of smuggling, which is core of economic crime is preceded by by bribery and corruption at this port. Given the high latency of smuggling as type of maritime fraud, the real picture of crime at the Douala-Bonaberi Seaport is much sadder. Due to the secretive nature and lack of verifiable data on smuggling, it is difficult to calculate with absolute precision the market size of trade. However, launching of Camcis on February 8 in Douala, the start of the second phase of production of the modules of the “Cameroon Customs Information System” (Camcis), the new customs computer system in force since 2020 was aimed at enhancing efficiency of customs clearance procedure and fight against smuggling in Cameroon seaports (Bah, 2023).

1.2 Problem Statement

The purpose of customs regulation in every state worldwide is to promote the sustainable development of the economy, enhance the welfare of the country’s population, and elevate its international standing. Conversely, today the domestic commodity producers of many countries are not able to effectively fulfill their potential even within the country, not to mention the range of violations of customs rules during the importation of goods across the customs border of the state. These phenomena contribute to the growth of corruption in the government, which negatively affects the economic development of the country. Despite such significance, the influence of customs efficiency factors and the fight against smuggling of goods on a country’s trade and economy have largely been overlooked. In Cameroon, Douala-Bonaberi seaport serves as a vital gateway for international trade, facilitating the flow of goods between West and Central Africa and global markets. However, its strategic importance also makes it a prime target for criminal networks seeking to exploit vulnerabilities in port security systems highlighting the need for comprehensive security measures to combat criminal activities. Between 2013-2018, undeclared trade between Cameroon, China and Vietnam is estimated at US$1.099 billion. This undeclared trade undermines government revenue and GDP of Cameroon. In order to counter this illicit trade through the Douala-Bonaberi seaport, customs authorities and relevant stakeholders are charge to stamp out the occurrence of this form of trade. however, literature hold that, the strategies implemented by the customs authorities and relevant stakehoders to enhance customs efficiency or effectively fight against smuggling are incompetent (Maxwell, 2021). It is against this backdrop that the study seeks to determine how an improvement of customs efficiency at the Douala-Bonaberi Seaport contribute to the effective prevention and reduction of smuggling of goods.

1.3 Research Questions

The research questions are subdivided into main and specific questions.

1.3.1 Main Research Question

How do customs efficiency measures contribute to effective fight against smuggling of goods at the Douala-Bonaberi seaport ?

1.3.2 Specific Research Questions

1. To what extend do measures taken for security at the borders contribute in the fight against smuggling of goods at the Douala-Bonaberi Sea Port?
2. To what extent do technological advances contribute to the fight against smuggling of goods at the Douala-Bonaberi Sea Port?
3. How does collaboration contribute to the fight against smuggling of goods at the Douala-Bonaberi Sea Port?

1.4 Research Objectives

The objectives of the study are subdivided into main and specific Objectives;

1.4.1 Main Objective

To examine the impact of customs efficiency measures on the effectiveness of the fight against smuggling of goods at the Douala-Bonaberi seaport.

1.4.2 Specific Objectives

1. To assess the extent to which security measures implemented at the borders in the fight against smuggling of goods at the Douala-Bonaberi Sea Port are effective.
2. To evaluate the impact of technological advancements on the prevention of smuggling of goods at the Douala-Bonaberi Sea Port.
3. To investigate the role of collaboration in fighting against smuggling of goods at the Douala-Bonaberi Sea Port.