Ladies and gentlemen,

It is my pleasure and honor to address this well-established symposium from Brussels where the Headquarters of the World Customs Organization is located. I should begin by thanking the organizer of the symposium, the US Customs and Border Protection, for giving me an opportunity to speak in my capacity as Secretary General elect of the WCO.

As the WCO places a lot of emphasis on the customs-business partnership, it is vital for me to explain the priorities of the Organization to the US business community.

Let’s start by reviewing the current economic situation as customs cannot operate from an isolated island. The attention of the world is now focused on two issues: the US Presidential election; and the financial crisis. Although non US citizens do not have voting rights, they are mindful of the implication of the choice of the new US leader in less than a week as it will affect global business. The current credit crunch which originated in the US is of concern because of its implication on the world economy, in particular international trade. In the past, global trade has continued to expand in spite of fluctuations in financial markets. However, this time many observers are concerned about the significance of the current financial market turmoil which might have an adversary effect on the volume of exports and imports and on the global trading system in general.

What does it mean for the customs community? There might be mounting pressure on customs administrations in developing countries to make more effort to safeguard and even improve revenue collections in order to contribute to fiscal consolidation. Furthermore, there might be a protectionist temptation to introduce an implicit trade barrier to defend domestic industry and the revenue base. In fact, we know that in 1930, following the Wall Street Crash, the US Congress passed the notorious Smooth-Hawley Tariff Act with higher tariffs, significantly worsening the Great Depression with a blatant trade barrier. The recent failure to reach a deal on the Doha Development Round also sent a worrisome message for the future of the global trading system.

I believe that under these circumstances, the customs community should remain responsive to these world events and join global efforts to sustain confidence in the trading system. In this regard, the WCO Council in June 2008 adopted the “Customs in the 21st Century” policy paper to guide customs administrations and the WCO given the key role they can play in contributing to enhanced growth and development through trade facilitation and border security. The foundation of “Customs in the 21st Century” is a cutting-edge list of ten building blocks for enhancing customs operations globally. Let me highlight some of the major components included in this policy document and how they will be translated into the daily work of customs.

Building Block 1 relates to “Globally networked customs” to manage seamless and end-to-end international supply chains. This model will enable risks to be assessed in more depth and managed earlier where necessary, thus reducing the need to intervene when goods arrive, while allowing for goods to be tracked and traced throughout the supply chain. Needless to say, this concept derives from the shift in customs attention from traditional import controls to the entire supply chain, including export and transit. This shift came about as a means to address security concerns in the post September 11th environment. The US CBP has been instrumental in this paradigm shift but all customs administrations around the world understood the necessity and supported the expansion of customs responsibilities in supply chain security and facilitation, embodied in the WCO SAFE Framework of Standards. This model requires the electronic exchange of advance data, based on the WCO Data Model, to enable secure, real-time exchange of information between business and customs and between customs administrations. Mutual recognition of customs controls and the introduction of the AEO concept are other necessary components to realize this scheme. Building Block 2 concerns “Better coordinated border management” among all relevant agencies involved in regulating cross-border movement of passengers, goods and conveyances. Customs is usually best suited to take a lead in controlling the movement of goods, supported by the electronic Single Window concept. The US integrated border management model that transformed US Customs into the US CBP has inspired many customs administrations to think about border cooperation and coordination. Reflecting national priorities, there could be several administrative models for border management including cooperation, coordination and integration. There is even a call for establishing a third pillar relating to coordinated border management in the SAFE Framework of Standards, in addition to the two existing pillars covering customs-to-customs networks and customs-to-business partnerships. Here I might add that WCO members are keen to intensify their work in exploring emerging models in this new area.

Building Block 3 speaks about “Intelligence-drives risk management” whereby scarce resources need to be targeted at the higher end of the risk continuum. In this connection, the WCO fully supports and endorses the recent congressional testimony by the Department of Homeland Security and US CBP on the need for a risk management approach to the scanning of containers bound for the US rather than the current mandate requiring 100% scanning of US-bound containers. In fact, the WCO has been and will continue to be constructively engaged with the US Congress to convey the serious and legitimate concerns of its 174 members, excluding the US, with respect to the 100% Scanning Legislation. As an alternative, WCO members support the US CBP initiative to focus on a risk management based approach and are therefore ready to discuss its request to review the necessary data elements, such as 10+2, for inclusion in the SAFE Framework. The WCO is pleased that US CBP supports globally standardized cargo data elements for targeting by participating in the SAFE amendment process.

Building Block 4 is the “Customs-business partnership”, a crucial element for both parties to understand each other and produce mutually beneficial outcomes. The WCO benefits from its partnership with the Private Sector Consultative Group by gaining insight into business concerns and through their valuable contribution to developing the future roadmap. Customs is expected to enter into strategic pacts with trusted economic operators. I understand that Carol West will follow up this item in her capacity as Chair of the Group.

These building blocks require “Implementation of modern working methods, procedures and techniques”, “Enabling technology and tools”, and “Enabling (legal) powers”. These three components, which are respectively identified as Building Blocks 5, 6 and 7, are of course supported by the WCO Revised Kyoto Convention dealing with the simplification and harmonization of customs procedures and the SAFE Framework of Standards.

Building Block 8 talks about “A professional, knowledge-based service culture” which shows the future orientation of “Customs in the 21st Century” equipped with timely customer-focused processes and services that minimize the administrative burdens on legitimate trade. Building Block 9 deals with “Capacity building” and requires the sharing of experience and best practice among customs administrations to inspire managers to plan and implement customs reform, based on internationally accepted standards. By way of example, there are many developing countries which are planning to introduce AEO programmes. While the SAFE Framework of Standards contains the AEO standard, they still ask for more detailed guidance. As the initial capacity building step in this regard, I have begun developing a compendium of existing AEO programmes to provide a reference source for those Members wishing to develop their own programmes and to prepare for mutual recognition. Likewise, I asked my team to prepare implementation guidance on how to implement the AEO concept, the first cut of which was presented to the SAFE Working Group a couple of weeks ago. The WCO makes its utmost effort to help customs by providing useful tools, however customs also needs its constituency to support its reform and modernization programme. Having said this, I would like to appeal to the business community to provide strong support for capacity building to ensure that customs administrations get the necessary political commitment and financial and human resources. Any customs operations and capacity building activities should be based on “Integrity” which is captured as Building Block 10 and which concludes the list of elements that support the New Strategic Direction for customs. The US has been a powerful advocate in this area and based on the suggestion of the US CBP, the customs community is ready to take up the issue of “facilitation payment” at the next WCO Integrity Sub-Committee.

I have quickly reviewed the ten supporting elements of “Customs in the 21st Century” as requested by the organizer of the Symposium. As you might have recognized, certain aspects of this policy document are somewhat aspirational and which many administrations are not in a position to accomplish. Nevertheless, WCO members hold a common view that such aspiration itself should not be regarded as a problem – in fact the value of the “Customs in the 21st Century” policy document rests precisely on its visionary and aspirational approach. The WCO Council instructed the Secretariat to ensure that future work of the WCO should be aligned to the directions charted by this policy document. In parallel with the new strategic direction, this major policy document also offers recommendations on how the WCO can address the challenges facing customs and expand upon its current roles and responsibilities to better meet the needs of the future. This implies an enhanced Secretariat to serve its members.Now, let me explain my programme to reform the WCO in three areas, which will also help the customs community to advance towards the roadmap described in the “Customs in the 21st Century” policy document. My first programme is to strengthen good governance in the WCO by enhancing communication with Members, using our regional structure. This will enable them to effectively participate in WCO activities and obtain concrete benefits. It is also vital to improve communication with our stakeholders, including the business sector and other international organizations. This symposium is relevant to this programme. Furthermore, last month I went to Geneva to see WTO Director General Pascal Lamy to discuss the way forward for the trade facilitation negotiations. We agreed to support each using our respective advantages: the technical excellence of the WCO and the political clout of the WTO. I will continue my efforts relating to communication and transparency as these are clearly vital elements.

My second programme is capacity building assistance to help Members implement WCO standards. At the beginning of this month I organized the Donor Conference in London to enhance dialogue and partnership, inviting customs administrations, major donors and the private sector from all regions to participate. Donors confirmed that money is available but they need better explanations on the feasibility of projects, ownership, and political support. On the other hand, customs representatives pointed out that access to donors is a complicated process. The WCO is willing to help its Members fill this gap through the Columbus Programme with its diagnostic and action planning process and through better coordination with donors. We have also established a network of Regional Offices for Capacity Building to encourage regional interaction with local donors and business to get their support. Furthermore, the Donor Conference in London pointed out that management and leadership is important at both the top level and at the lower level. Change management and human resource management are areas that require more work in accumulating experience and information, and in applying the theory into practice in the customs field. In more general terms, customs capacity building will continue to be improved by developing a standardized approach, and standardized tools and material with the necessary national adjustments of course. With this in mind, it is essential for the WCO Secretariat to facilitate Members’ sharing of success stories and lessons learned and just as vital to identify and respond to urgent and evolving needs and to monitor implementation by focusing on core WCO instruments.

My third programme is research on emerging issues that the customs community is constantly faced with as a result of globalization. By way of example, the protection of the environment is now high on the international agenda and the customs community is capable of contributing at borders, in particular by regulating cross-border movement of toxic waste and hazardous chemicals. In fact, I have decided to dedicate next year’s international customs day to the theme “Customs and the Environment: Protecting our natural heritage”. This requires however a better understanding of the topic at the top management of customs and intensive policy coordination with other ministries and agencies. This is why I am going to establish a research unit within the Secretariat. In fact, for many issues relating to Customs in the 21st Century, basic research and case studies will be necessary prior to beginning the development of new instruments or programmes. My entire programme rests squarely on better engagement of WCO Members and close cooperation with our stakeholders. Business and the wider trade world have much to offer the customs community in moving forward its Customs in the 21st Century new strategic direction and the WCO reform programme. Indeed, I would like to rely on this critical partnership with trade; a partnership based on trust and which will enable us to jointly respond to the challenges of the 21st Century.

Thank you for your attention.