The vision of a Free Trade Area of the Americas that we are all working towards is indeed a compelling one: a vast market of more than 800 million people, with over 11 trillion dollars in production, and 3 and a half trillion dollars in trade; a thriving market distinguished by low or non-existent tariffs, uniform trade and investment laws, and the gradual disappearance of quotas, subsidies, and other impediments to trade.

The power of that vision has inspired impressive progress to date in the FTAA negotiations. Still, a great deal remains to be done if we are to complete this historic project by its target date of 2005. Hard bargaining will be required to turn existing proposals into a binding agreement. The sheer complexity of the trade rules under discussion, and the diversity of countries involved, will make reaching consensus a major challenge.

But we should not underestimate the motivating power of the FTAA vision. Indeed, it is a useful model to consider as we reflect on our own, customs vision for the future. What is the ideal that we should strive towards as we work to harmonize customs procedures across the western hemisphere?

Today, I want to offer you the perspective of the U.S. Customs Service on the future of global customs, and what we are doing to tie these various elements together within our own agency. I also want to give you a sense of the challenges we face. In doing so, I hope that we might help to evolve the shared vision that is forming among our international partners and the trade community gathered here today.

When we envision the future of global trade at U.S. Customs, what do we foresee?

We envision seamless, paperless processing at all our borders and ports of entry, made possible by technology and uniform data that can be shared easily between countries.

We foresee selectivity that is entirely risk-based, with deployment of the most advanced automated systems at our borders to empower risk management.

We expect that intrusions by Customs into business will be driven only by exception, the result of a legal violation or an impending threat. For example, a national crisis, such as the recent hoof and mouth scare, or a terrorist incursion. We envision a partnership with the trade in which importers pre-approved by Customs will be the recipients of low-risk benefits, the result of their strong record of compliance. They will receive expedited clearance with little or no interruption at the border. They will establish and monitor their own internal compliance programs in consultation with Customs.

We envision this framework of cooperation delivering powerful benefits for business and for government alike -- benefits that maximize security and efficiency, while minimizing cost.

The trade community should be able to expect the same type of treatment from one country to the next. For all intents and purposes, a common, global customs infrastructure would render physical borders meaningless.

That, in brief, is our vision for the future. Given enduring health and safety concerns, and other national interests, there will always be a strong need for a Customs presence at our borders. But for law-abiding importers that presence would hardly be felt, provided we succeed in building a common customs language and processes among the nations of the world.

To advance this vision, U.S. Customs is starting from within.

We are continuing to institute the principles of risk management throughout the agency. We are employing a more rigorous method of data analysis to separate out highly compliant importers from those more prone to violations. We are building a new system of automation that will enable us to compile, assess, and share account data with our clients.

The Automated Commercial Environment, or ACE, is the key to our ability to manage an ever-expanding volume of trade. It will empower our risk management approach. It will enable us to focus our enforcement efforts where they’re needed most, while allowing legitimate trade to pass through our borders unimpeded.

We are continuing to refine our approach to compliance with the trade community. Partnership is our defining theme. Companies that demonstrate a commitment to compliance will be self-monitoring.

One hundred fifty companies so far have been designated low-risk by Customs, and are already receiving the benefits of expedited clearance with minimal requests for information. While that may not sound like a large number given the tens of thousands of importers we work with, these companies account for approximately 20% of the total volume of trade we process. We are constantly evaluating the pool of eligible companies in an effort to expand these benefits to a broader span of the trade.

We have established account-based management to analyze major importers' activity in the aggregate, to better address their needs. We are sharing account data with our clients, and working with them to identify and correct problems. We have assigned individual Customs representatives to the largest importers to facilitate this process.

To put it concisely, we are learning to do business the way business does business, with technology, with improved customer service, and with a focus on the bottom line.

However, there are still challenges to face, beginning with automation. ACE, for all of its advanced features, will take time to develop -- a minimum of five years, given the size and complexity of the project. That time-line is highly dependent upon Customs receiving a steady and continuous source of funding for modernization.

Our Congress is sympathetic, but we are competing with many national priorities. We traveled a long road just to get the start-up funding for ACE. Getting a consistent level of funding to complete the new system on schedule will take a major effort.

Meanwhile, we are operating with an outdated system of automation, the Automated Commercial System, or ACS. ACS is under severe strain from the increasing volume of goods being processed at our borders. We've received funding in our budget to maintain ACS, but this is not the way we want to continue to do business. The bottom line is, we need ACE.

In addition to new automation, our physical port infrastructure needs to be addressed. Our facilities must be upgraded to meet the growing border traffic. We recently completed a Port Infrastructure Study for the U.S. Congress. We identified a range of critical infrastructure needs that exist along our borders. We know what we need to do, but it will come at a substantial cost.

Developing the technology and the infrastructure to expedite trade processing is a critical customs challenge. But we also have to contend with an array of competing interests within the trade community itself.

For every company that seeks wide-open borders and minimal intrusion from customs, there is another company pressing for tighter controls on incoming goods that may be harmful to its business. In addition, we must work with a myriad of service providers to the trade, many of whom have different ideas about how their relationships with customs should work.

There are many business interests woven into our determination of what constitutes an exception and what does not. We need the members of the trade community to come to agreement on what is important to them. The trade must lead the way in working out competing claims, and if need be, take them to a higher policy level.

These core challenges and others must be addressed by U.S. Customs and our partners in the trade. At the same time, we should strive to build our customs vision outward, with a global perspective. What better place to start than right here in our own hemisphere?

The customs administrations of this region have much in common in terms of their broader goals. We are all concerned with promoting and facilitating economic growth. We are concerned with the health and safety of our citizens, and defending them from the threats inherent in the expansion of global trade. We are all committed to the principles of risk management, to information sharing, to smooth and seamless borders, and to minimal intrusion into business. This is a tremendous foundation on which to build our shared vision.

Where we are lacking, and at the same time where we have our biggest opportunity, is in laying out a common definition of what each of these concepts means. Right now, they mean somewhat different things to each of us.

We need to standardize our understanding of risk. What constitutes those exceptions that we should filter out? Related to that, we need a shared definition of what it means to be "low risk," and the level of information we expect from importers to determine that. We also need to develop a common approach to audits and assessments.

All of the technology, all of the infrastructure in the world will not help us to achieve a truly "Free" Trade Area of the Americas if we don't do the hard work first. We cannot simply buy and build perfect borders without first establishing a common customs language. Right now, this is the central challenge we all need to focus on -- not just the customs administrations gathered here today, but the entire trade community.

I applaud the adoption by FTAA countries of the eight customs business facilitation methods laid out at the Toronto Ministerial in 1999. This was a very positive step. These measures should be implemented with minimal delay.

Accession to the revised Kyoto Convention on Customs would represent another, significant achievement. The Convention lays out a series of uniform principles for simple, effective, and predictable customs procedures, including adoption of the risk management approach.

Beyond this, we must continue to work together to harmonize the mechanics of free trade, and expand our common customs language.

With the evolution of the Free Trade Area of the Americas, we have an unprecedented opportunity to advance our customs vision. Our responsibility -- Customs and the trade -- is not only to meet, but to exceed this challenge, and not squander the opportunity. If we succeed, we will safeguard our burgeoning global market, and foster prosperity for generations to come.