Document prepared for the Tenth Joint Annual Meetings of the African Union Specialized Technical Committee on Finance, Monetary Affairs, Economic Planning and Integration and the Economic Commission for Africa Conference of African Ministers of Finance, Planning and Economic Development, taking place in Dakar from 27-28 March 2017

Report of the 8^th Ordinary Meeting of the African Union (AU) Sub-Committee of Directors General of Customs

The 8th Ordinary Meeting of the African Union Sub-Committee of Directors General of Customs (AUSCDGC) was held from 17 to 18 November 2016 at the Monomotapa Hotel, in Harare, Zimbabwe. The theme of the meeting was “From Barriers to Bridges – Implementing One Stop Border Posts for Improved Trade Facilitation.”

Participants from the following Member States attended the meeting: Algeria, Burundi, Burkina Faso, Cameroon, Central Africa Republic, Comoros, Cote D’Ivoire, Democratic Republic of Congo, Ethiopia, Gambia, Ghana, Guinea,Liberia, Malawi,Mali, Niger, Nigeria, Rwanda, Senegal, Sierra Leone, Sudan, South Africa, Tanzania, Togo and Zimbabwe. The Regional Economic Communities and International organizations present were COMESA, EAC, SADC, AfDB, UNECA and WCO. A representative of the Pan African Parliament (PAP) also attended the meeting.

Opening of the Meeting

Statement by Mr. Happias Kuzvinzwa Acting Commissioner General of Zimbabwe Revenue Authority

In his opening remarks, Mr. Happias Kuzvinzwa, the Acting Commissioner General of the Zimbabwe Revenue Authority (ZIMRA), welcomed participants to Zimbabwe and to the 8th Ordinary Session of the AU Sub-Committee of Directors General of Customs. He applauded the theme of the meeting noting how it relates to the subject of transforming trade barriers to bridges that facilitate smoother movement of goods and people and improved connectivity amongst African states.

Mr. Kuzvinzwa recalled how implementation of One Stop Border Posts (OSBPs) is one of the ways in which trade facilitation can be improved, particularly at borders. He gave as an example the Chirundu OSBP between Zambia and Zimbabwe where independent studies have shown improvement in efficiency by increasing truck clearances per day from 260 to 600, reducing truck clearance times from 3 days to an average of 3 hours, increasing the number of declarations dealt with from 380 to 700 per day and reducing clearance times for private cars from several hours to between 30 and 40 minutes. The Commissioner General informed the meeting that Zimbabwe was continuing to engage its neighbours bilaterally to facilitate the establishment of OSBPs at the other borders. He also noted that Africa had embraced the OSBP concept as a progressive initiative.

In his concluding remarks, Mr. Kuzvinzwa reminded delegates that the 8th Ordinary Session of the AUSCDGs Meeting would go down as a landmark event for Africa and urged participants to apply themselves diligently to make it a success. He appreciated the good work that had been done by the various technical working groups that had been meeting so far.

Statement by Ambassador Lazarus Kapambwe. Special Adviser on Economic Affairs to the AU Commission Chairperson

On behalf of Mrs. Fatima Haram Acyl, Commissioner for Trade and Industry of the AU Commission who was unable to attend the Directors General Meeting due to other commitments, Ambassador Lazarous Kapambwe welcomed participants to the 8th Meeting of the AU Sub-Committee of Directors General of Customs and thanked the Government and People of Zimbabwe for their hospitality.

Referring to the theme of the meeting, Amb. Kapambwe highlighted the importance of removing barriers to trade as a trade facilitation measure that would speed up the establishment of the Continental Free Trade Area. He then recalled the pertinence of the WTO Trade Facilitation Agreement and urged AU WTO Member States that have not yet done so, to accelerate its ratification and implementation. It is estimated that implementation of the WTO TFA could reduce the costs of trade by between 12.5 and 17.5% amongst both developed and developing countries respectively. In this regard, he urged Member States to implement the necessary trade facilitation measures that will ensure the tightening of loopholes in order to attain the AU’s vision of doubling intra-African trade by 2022.

Ambassador Kapambwe stressed the important role of Customs Administrations in facilitating the movement of goods, services and people across national borders. In conclusion, he called on Customs Administrations to facilitate the implementation of the decision of Heads of State and Government to impose a 0.2% levy on eligible imports into AU Member States to finance the activities of the Union on a reliable and predictable basis.

Presentation by the outgoing Chair

In his presentation, Mr. Deo Rugwiza Magera, the outgoing Chair of the AU Sub-Committee of the Directors General of Customs gave a summary of the activities held during his Chairmanship, from September 2015 to November 2016. He informed the meeting that the Bureau met in Kinshasa, the Democratic Republic of Congo in February 2016 to, amongst others; develop strategies on the implementation of the recommendations from the 7th Ordinary Session of the Sub-Committee of Directors General. Mr. Magera further informed the meeting that the Bureau took the opportunity to undertake a mid-term evaluation of its activities, as well as consider future activities and reflect on ways and means to improve the work of the Sub-Committee of Directors General of Customs.

At the end of the deliberations, the Bureau made the following recommendations;

1. Authorise the Chair of the Bureau of AUSCDGC to send letters to Member States, to the Commission of the African Union, to the Regional Economic Communities and to International Organisations to recall the recommendations of the 7th meeting and encourage them to implement them;

2. Encourage the participation of Customs Administrations in the Negotiating Forum for the implementation of the CFTA;

3. Encourage the speeding up of reforms pertaining to computerisation of customs administrations with a view to facilitating exchange of data;

4. Adopt a regional approach to interconnectivity of computerised systems as a stepping stone towards the continental level ;

5. Encourage Member States to conclude bilateral and multilateral agreements with a view to promoting exchange of information ;

6. Popularise the recommendations of the 7th meeting of the AUSCDGC within the meetings of the Directors General of Customs of WCO Sub-Regions as well as in all other customs and trade facilitation meetings;

7. Undertake the review of the Rules of Procedure of the Sub-Committee of Directors General of Customs of the African Union in consultation with Member States;

8. Authorise the Chair to explore alternative means of financing the implementation of recommendations issuing from meetings of the Sub-Committee of Directors General of Customs of the African Union in consultation with Member States.

Implementation of the import levy for financing the African Union Commission

A representative of the African Union Commission made a presentation on the decision of the African Union Summit of Heads of State and Government taken during their 27th Ordinary Session in Kigali Rwanda on the implementation of a 0.2% levy to finance the programs and operations of the African Union. In his presentation the presenter recalled the various initiatives at the African Union level to identify alternative sources of funding. He informed the meeting that after consideration of the various alternatives, the AU settled on instituting the 0.2% Levy on eligible goods, with 2017 as a transition period.

He further informed the meeting that in order to implement this decision, the Summit established a committee of ten Finance Ministers (F10) drawn from the five AU regions. Among others, the committee was tasked to work on the modalities of the implementation. He then shared with the meeting the guidelines as developed by the Committee of Ten (F10). Thereafter, he concluded by calling upon the meeting to provide recommendations on how best the modalities can be implemented, especially by Customs Administrations.

In the discussions that ensued after the presentation, the Meeting made the following observations:-

1. That it will be important to clearly define “eligible imports into Africa” upon which the levy will apply, especially given that some AU member States already have trade arrangements with countries outside Africa

2. That there is need to for member states to enact a legislative framework that will enable them to collect this levy

3. That collection of the levy will entail some costs and hence there is need to carefully consider how this cost should be internalized

After the discussions, the meeting recommended that;

1. A roadmap for implementation of the levy be developed, taking into account the 2017 transitional period

2. A Technical Working Group be established to consider this matter further from a Customs perspective

Exchange of views on the meeting theme: “From barriers to bridges – Implementing One Stop Border Posts for improved trade facilitation”

A representative of Zimbabwe Revenue Authority made a presentation on the importance of OSBPs in promoting Trade Facilitation so as to stimulate discussions on the theme of the meeting and provide an opportunity for the Directors General to get acquainted to the background of the meeting theme. The presentation outlined the journey, achievements and challenges that ZIMRA went through in establishing the Chirundu OSBP, a border post between Zimbabwe and Zambia.

The presenter shared with participants the processes that the two countries went through in order to operationalize the Chirundu OSBP. This also involved enacting relevant legislation amongst others. To date, the OSBP is fully functional and benefits to trade include improved traffic turnaround time; reduced clearance time; reduced inspection costs as well as smooth flow of traffic. Both Customs Administrations do share resources available so as to achieve optimum use.

The establishment of the Chirundu OSBP provided a learning opportunity to the Governments of the two Customs Administrations. There was a realization on the need to involve all the border agencies and other stakeholders so as to have their buy-in and cooperation. Equally important was the need for computerization and use of ICT by the various border agencies to enable faster exchange of information. Further it was noted that cultural differences had to be addressed to inculcate a common sense of belonging in the common controlled area.

Panelists to the meeting theme included representatives from the African Development Bank; the Pan African Parliament, the World Customs Organization; Cote d’Ivoire Customs Administration and ZIMRA. The panelists raised the following issues;

1. From the conceptualization stage, there is need to involve other Government Agencies and other stakeholders who have interests at the border

2. Ensure that adequate funding for infrastructural development(both hard & soft) is readily available

3. There is need for Change Management among all players so as to converge a variety of natural differences including cultural dispositions.

4. Proper designs for traffic circulation have to be synchronized across the border.

5. Political support is vital, especially from the highest level

6. Need to implement effective national level interventions to remove NTBs, especially those relating to multiple controls at the borders.

7. Border procedures in both countries supported by the automated systems need to be harmonized

8. Road infrastructure should be in a state to be able to support operational requirements of the OSBP

From the discussions that took place after interventions by the panelists, the meeting made the following observations;

1. There is need for consolidation of OSBP concept in the REC Policy and Legal Framework given that as the regional integration intensifies, such as at Customs Union level, there will be a Common Customs Act.

2. The RECs have to include all government agencies in the OSBP Regional Laws and to ensure that there is capacity building across the region to improve efficiency.

3. Customs Administrations need to engage respective Parliaments for the ratification and domestication of all Protocols and other legal instruments for the effective integration in Africa. Parliaments should also help expedite the laws that will remove legal impediments to the trade facilitation measures.

4. Member States are encouraged to take advantage of the WCO instruments to support the OSBP operations such as the Transit Guidelines. Also available is the OSBP Source Book developed by the WCO in collaboration with the AUC, soon to be published by NEPAD.

5. Member States may approach the AfDB for funding assistance through loans and grants

Thereafter, the meeting made the following recommendations:

1. That Member States considering establishment of OSBPs to ensure involvement of other border agencies and all other relevant stakeholders

2. Implementation of OSBPs should be accompanied by other trade facilitation measures and reforms and also change management strategies

3. That Member States should consider regional approach in the implementation of OSBPs

4. In the establishment of OSBPs, Member States should endeavor to incorporate international best practices

5. There is need for involvement of national parliaments so as to develop legislation required for establishment of OSBPs

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Recommendations

WE, the Directors General of Customs of the African Union assembled in Harare, Republic of Zimbabwe, on the 17th and 18th day of November 2016, on the occasion of our 8th Ordinary Session

RECOMMEND AS FOLLOWS:

A. On Accreditation of Customs Officials from AU Member States

i. That The AUC and the WCO should:-

a. Elaborate a joint program for supporting African Customs Administrations in their priority reform initiatives and

b. Continue to work together in increasing the pool of WCO-accredited Experts

ii. That African Customs Administrations should make their WCO pre-accredited and accredited Experts available to assist other Members in their reform and modernization initiatives.

iii. That the WCO should endeavor to fully accredit the pre accredited experts in the shortest period possible so that they are made available for use in the African region by the WCO, the African union Commission and the Regional Economic Communities.

iv. That The AUC should continue to look for resources for holding similar accreditation Workshops for experts from African Customs Administrations

B. On the Gap Analysis Study on the Implementation of the WTO Trade Facilitation Agreement in Africa

That the African Union Trade Facilitation Strategy should take into account recommendations from the Gap Analysis Studies

C. On the Development of the African Union Trade Facilitation Strategy

To African Union Member States

1. That Customs Administrations collaborate with the private sector and are consulted on issues of Trade Facilitation.

2. That African Union Member States explore the Introduction of Trade Facilitation Courses in the education curriculum especially at the University level in collaboration with such institutions as the Trade Law and Policy Center for Africa (TRAPCA)

3. That African Union Member States should endeavor to encourage each other to implement Trade Facilitation measures under the WTO Trade Facilitation Agreement.

4. Member States are urged to strengthen National Committees on Trade Facilitation through inter-alia, the inclusion of other border agencies and private sector representative organizations for the sustainable adoption and implementation of trade facilitation reforms.

To the African Union Commission and the Regional Economic Communities

1. The African Union Commission continues to provide a Platform for exchange of Information and experiences on the implementation of Trade Facilitation measures in Africa.

2. That the AUC should take steps to collaborate with the WCO to exploit synergies with Development Partners so as to leverage TFA implementation support for Member States Customs Administration and RECs.

3. The African Union Commission and the RECs should continue to encourage the African Union Member States to adopt where necessary regional approaches in the implementation of the WTO Trade Facilitation Agreements

4. The AUC and the RECs are urged to develop training, capacity building and sensitization programs on substantive TFA provisions for all stakeholders.

To International Organizations

1. The WTO and other International Organizations should continue to assist African Union Member states in building their Capacity for the implementation of the WTO Trade Facilitation Agreement

2. That the WCO shares with the RECs the available pool of accredited experts on Trade facilitation so that they can also be utilized in regional capacity building programs.

D. On Implementation of the Import Levy for Financing the African Union

1. A roadmap for implementation of the levy be developed, taking into account the 2017 transitional period

2.  A Technical Working Group be established to consider this matter further from a Customs perspective.

E. On the Theme of the Meeting: From Barriers to Bridges – Implementing One Stop Border Posts for Improved Trade Facilitation

1. That Member States considering establishment of OSBPs to ensure involvement of border agencies and all other relevant stakeholders

2. Implementation of OSBPs should be accompanied by other trade facilitation measures and reforms and also change management strategies

3. That Member States should consider regional approach in the implementation of OSBPs

4. In the establishment of OSBPs, Member States should endeavor to incorporate international best practices

5. There is need for involvement of national parliaments so as to develop legislation required for establishment of OSBPs

F. On Any Other Business

That there be a meeting of the Sub-Committee of Directors General to enable them prepare common positions prior to the WCO Council Sessions.