This is my first time to host this important conference, and I look forward to our discussions over the next few days. Some of those discussions actually began at last night’s reception—and will continue during today’s panels.

I especially want to thank those members of the trade who are lending their considerable expertise to these panel discussions. The topics we’ve chosen for this year’s agenda allow us to tackle some of our most challenging issues, and I’m looking forward to making real progress toward our common goals in several areas.

I’m also looking forward to hearing from our distinguished luncheon speaker, Rob Portman, the Director of the Office of Management and Budget—and the former U.S. Trade Representative.

And, on Friday, Richard Barth, the Assistant Secretary for Policy Development at the Department of Homeland Security, will join us. CBP is proud to claim Rich as one of our own. As some of you may know, he worked for U.S. Customs as a chemist earlier in his career, and we are delighted we can still lay claim to his talents.

I’ve been Commissioner of Customs and Border Protection for six months now, and it’s certainly been an educational experience. But, I also have to say that I have loved every minute of getting to know the people and the challenges of this job.

As many of you know, I’ve spent much of that time on the road. And, having served in the government for over 35 years, I know Washington, at times, is not the real world. I knew I couldn’t learn about the complex operations of CBP—both law enforcement and trade—by sitting inside the Beltway listening to briefings and watching power point presentations.

So, my first order of business was getting a firsthand perspective about the many responsibilities that fall within CBP’s mission—and a huge part of our mission relates to trade. Everywhere I’ve traveled, I’ve made a point of meeting with members of the trade community to learn about your businesses—and your concerns.

My first speech as Commissioner, barely one week into the job, was to a trade organization—AAEI—the American Association of Exporters and Importers.

Since then, I’ve spoken to a number of other important trade organizations and I’ve become proficient in the many acronyms that all of you know so well: NCBFAA, CONECT, ITA, and ACE.

On Tuesday, I spoke with TSN—the Trade Support Network. I have met with retailers and manufacturers, and last month, I co-chaired my first COAC meeting.

I have visited some of the busiest and most strategic ports in our country—including LA/Long Beach, where almost 44 percent of all the cargo coming to the United States arrives. On Monday, I returned from India where I attended a WCO Policy Commission meeting that focused heavily on trade facilitation issues.

So, it’s been a busy year. But, early on, even during the confirmation process, I knew I wanted to reach out to the trade community and establish a dialogue—to assure you that I understand—now more than ever—how vitally important our partnership is to both the security of our nation and our economic prosperity.

Five Years of Progress
The theme of this year’s conference, as you know, is “The World of Trade: Five Years after 9/11.” And while our world is considerably different today, it is a better world for trade. Today, because of the work we’ve done together since 9/11, I believe our nation and your companies are more secure.

I can also say that trade is moving faster. And this isn’t just me saying this. This is confirmed by a World Bank survey—Doing Business 2007—that was released earlier this year. Many feared that the tighter security after 9/11 would throw sand in the machinery of global trade, but in fact, the study says the opposite has happened. Improved supply chain security has actually greased the wheels of commerce, making it faster and more efficient.

What an achievement! What a testament to the work we have done together!

Right after 9/11, you knew you had to build a layered defense, by pushing our borders out, beyond our physical borders. Both business and government understood in a very real way that shutting down our borders also shuts down our economy. So, you quickly established the twin goals of securing our borders, but doing so without stifling trade.

Somehow even then you knew those efforts would be evolutionary, because you were instituting long-term changes. But I don’t think any of you had any idea just how truly revolutionary those changes would be.

Five years ago, as you were reacting to a direct attack on our nation, who among us could have imagined today’s reality:

• That the U.S. government would be receiving advance information on all cargo and passengers coming to the U.S., and that this information would be analyzed for risk of terrorism in a sophisticated data center.
• Who could have imagined that we would have leading edge technology, like Radiation Portal Monitors and Non-Intrusive Inspection equipment—both stationary and mobile—at our seaports and land ports of entry.
• That the modernization of our commercial operations, which you have worked on for many years, would be delivering new business tools, that truckers would be filing manifest information electronically, and that we would be collecting payments monthly.
• Who could have imagined that our Container Security Initiative would not only be successfully deployed in 50 foreign ports, but that we would be screening more than 80 percent of cargo coming to the U.S.
• That C-TPAT, our supply chain partnership that was initially described as “a narrow strip of ground existing between voluntary and regulatory programs,” has successfully changed the way we do business.
• That the international trade community and customs administrations around the world would embrace these security and facilitation concepts by adopting the World Customs Organization Framework—and by establishing the Private Sector Consultative Group to provide trade input to WCO proceedings.
• That Congress would endorse and codify our work in the SAFE Port Act signed into law just a few months ago.
• And, 5 years ago, when our borders were closed and assembly lines were shutting down because just-in-time parts could not get through who could have imagined that today the import value of trade has actually grown to an all-time high of $1.9 trillion—a 17 percent increase over last year.

This is what CBP and Trade built together. All of these revolutionary concepts and programs exist today because of you—and because of our partnership.
We will never forget how you stepped forward, not on September 12th, but on September 11th—that very day and asked: “What can I do? How can we help?” It was a surge of patriotism that spurred us on back then. Today, we continue our efforts because we see that what we envisioned then really works. The system you put in place is good for business and good for the economy—and it protects our country.

But, as tempting as it is to pat ourselves on the back and list our successes, that is looking back. That’s history. Now is not the time for backward glances, it is a time to look ahead.

At this point, five years after 9/11, we need to be thinking and planning for what we want the world of trade to look like five…ten…twenty years down the road. What do we need to do today to ensure that our vision for tomorrow succeeds?

We are poised right on the edge of a new and exciting era—one we helped to create—and one that, together, we will lead. We will forge the way for trade in the 21st century. We’ve already written the first chapters of that history, but today, we must turn our attention and our creative energies to writing the next chapters. Today, I want to share with you my ideas for the way forward.

The Way Forward
With the components of our strategy firmly in place, and now enacted into law, we have a clear mandate to continue and evolve our programs.

This new law comes with many requirements that will play a large part in forming our agenda for the coming year. But, the demands of Congress are virtually the same demands we have placed on ourselves. Their priorities are completely consistent with the priorities we have set in CBP, in DHS, and with you.

This morning, I want to talk about six SAFE Port Act mandates that we will be implementing as the new year begins.

Office of International Trade
First, we were ahead of the curve on one of the mandates of the SAFE Port Act—the reorganization of trade entities within CBP.

When I was preparing to be Commissioner last year, I had a number of trade briefings—all of which were impressive, even intimidating. During that time, I was struck by the number of different CBP offices who were part of the briefing. And, as soon as I was confirmed, I began to look for ways to bring about greater unity in our trade programs.

Because I believed so firmly in the value of restructuring CBP’s trade-related entities into a single office—and in anticipation of the legislation—I created a new CBP Office of International Trade in October.

This new office consolidates CBP’s trade policy, national trade programs, trade measurement, and accountability functions at Headquarters. The new structure strengthens our ability to carry out our dual mission of facilitating legitimate trade, while we also secure our borders and protect the American economy from unfair trade practices and illegal commercial enterprises.

I think you will also find that this consolidation of trade functions will improve our interaction with the trade community and will provide greater consistency within CBP. This is especially important with respect to our international trade programs and operations, such as the prevention of textile transshipment and protection of Intellectual Property Rights.

Dan Baldwin, our first Assistant Commissioner for the Office of International Trade, will be moderating a panel later in the Symposium, so that you can learn more about the functions and goals of this new office.

Advance Information—10+2
Second, the SAFE Port Act calls upon us—trade and government—to do more and to work together even more closely. It mandates, for example, consultations with COAC—the Commercial Operations Advisory Committee—on an extensive list of issues, programs, and plans.

This mandate requires COAC to establish an entirely new series of subcommittees, and I was delighted to see the group rapidly establish this new structure at their meeting in New York last month.

Together, we need to meet the Act’s requirement for a range of reports and pilot programs over the next 12 months. And, COAC has demonstrated that they are ready to lead the private sector to deliver on the tight deadlines the law requires. CBP is ready to engage fully in this process and several discussions are already underway.

One of these discussions is focusing on the SAFE Port Act mandate to collect more detailed information on international supply chains to better support our risk targeting process.

We have long recognized the need to go beyond the 2002 Trade Act data requirements to gain greater transparency into the supply chain—back to the point of stuffing. Providing an assurance of security across the entire supply chain is a basic requirement for C-TPAT membership. Better information means better risk management. And better risk management leads to both enhanced security and enhanced facilitation of legitimate trade.

We now need to demonstrate to Congress—within a relatively short time—that we are responding to their mandate.

Our discussions with the trade over what additional data elements would improve our ability to assess the risk for terrorism stretch back over three years. The Trade Support Network‘s Supply Chain Security Committee has worked diligently on this problem during the past year. The result has been a data set we call “10 + 2.” This is shorthand for 10 additional information elements and two reports used routinely to track containers.

COAC is now leading a discussion to help us refine the definitions of the 10 data elements and provide advice on the best means of reporting the information to CBP. We expect to complete the COAC discussion in February and move into the rule making process in the spring. This will provide an additional period for comments from the trade. And, I hope to start implementing the new reporting requirements by the end of next summer.

Like the Trade Act, and many of the new security measures we have implemented over the past five years, 10 + 2 will be phased in. With these new reporting requirements, I want to be sure that all the issues that impact your business are resolved before we go to full compliance. But, based on our long track record of successful implementations, I am confident that, together, we can achieve this ambitious goal.

And, since the purpose of 10 + 2 is to improve our risk targeting, I want to assure you that the information will generate facilitation benefits and help us release low risk cargo even faster.

Jay Ahern will lead a discussion in the next panel with more details about 10 + 2.

Technology
Third, over the past five years, the technology we’ve developed to assess risk, to detect radioactive materials, and to improve our business management systems has grown more and more sophisticated—and is integral to our way forward.

Here at home, we will complete our deployment of RPMs at our seaports by the end of next year. So, we will significantly exceed the SAFE Port Act requirement to deploy this equipment to our 22 largest ports by the end of 2007. By then, we will screen 98 percent of all incoming container cargo for radiation.

And beyond this deployment, we’re moving toward the next generation of RPMs—the Advanced Spectroscopic Portal—or the ASP. Next year, we will begin deploying ASPs at our ports of entry. This equipment will eliminate the need for us to stop a truck when an innocent radiation source sets off the alarm. This removes one more impediment to the rapid release of goods.

We are also seeing promising new advances in radiography that provide enhanced imaging while maintaining driver safety.

And again, Congress has been supportive in its funding of these technologies.

Secure Freight
Fourth, exciting new developments are taking place overseas, as well.

Last week, Secretary Chertoff announced the Secure Freight Initiative, which launches a unique project to research new advanced scanning techniques before containers leave foreign ports for the U.S.

In three terminals around the world—Port Qasim, Pakistan; Port Cortes, Honduras; and Southampton, United Kingdom—this project will deploy an integrated network of radiation detection and container imaging equipment.

The outputs from this technology, combined with our normal analysis of manifest data, will provide a comprehensive, real time approach to assessing the risk of every container leaving the terminal bound for the United States.

Fulfilling another SAFE Port Act mandate, this project will be fully implemented in the ports of Qasim, Cortes, and Southampton, with some limited capacity in four additional ports.

This initiative is the culmination of our work with other Government agencies, foreign governments, the trade community, and vendors of leading edge technology. And, like all our security initiatives, this increased information will help facilitate trade because questions about shipments that appear to be high risk can be resolved quickly and effectively.

The scanning project is a first step toward realizing a greater vision of Secure Freight, a fully integrated global network for risk assessment. The key elements of this network are real time imagery and radiation detection, together with a fusion center that receives and analyses advanced trade data from numerous international supply chain sources.

This Secure Freight concept envisions a private sector-based approach to obtaining information on global cargo movements, beyond currently regulated submissions. It represents the next generation of global supply chain security tools, and we are very excited about taking the initial steps toward this new capability.

But Secure Freight could not have happened five years ago. It is, as I said, the culmination of our efforts, and more importantly, our partnerships, around the world.

ACE and ITDS
Fifth, I now want to turn to ACE, where dramatic progress has been made since 9/11. ACE has moved from an IT design concept to a field-deployed reality.

As we continue to develop the system, it is becoming clear that ACE will generate a number of significant changes to the international trade process of the future.

First, we will drastically reduce, or eliminate, paper. We’ve already identified as many as 70 government forms we can eliminate! The normal method of payment will be on a monthly, or periodic basis. This will result in real manpower and economic savings to CBP and the trade.

Second, the trade community will use the ACE portal to exchange information with CBP and to better manage their compliance activities. By the end of 2007, all trucks entering the United States on both borders will be full ACE participants, and will be providing manifest information in advance as required by the Trade Act.

ACE is quickly becoming an integral part of business life, and it will become the primary trade processing system CBP will use—and we all need to prepare for those changes. We need your help to make sure your company, and everyone in the trade community, is ready for ACE.

And third, ACE will also provide the technology backbone for the International Trade Data System, or ITDS.

As you know, the SAFE Port Act mandates that all Federal agencies with import or export data requirements will participate in ITDS. It will be the “single window” through which all trade information will be submitted to the federal government. Through ACE, CBP will work with other federal agencies—29, so far—and the trade community to build an import/export process that will set new standards of efficiency and transaction speed.

Last year’s adoption of the WCO Framework makes the single window into government and standard set of trade data through ITDS even more promising. With 138 of its 169 members having signed onto the Framework, the potential of achieving common standards to both secure and facilitate global trade is unprecedented.

C-TPAT
And sixth, all our progress has depended on our partnerships—and one of the most important is C-TPAT.

Perhaps the most unique program to result from our common reaction to 9/11, C-TPAT continues to evolve with refined security criteria, three tiers of benefits for importers, and more supply chain security specialists to conduct validations.

C-TPAT’s more than 6,000 members account for 45 percent of imports into this country. And, in the next few years, C-TPAT will evolve even further to respond to the widespread demand for participation.

The SAFE Port Act authorizes C-TPAT and provides guidance on how the program will evolve in the future. COAC, too, is launching discussions over implementation of SAFE requirements in this area.

We will also continue to pursue mutual recognition between C-TPAT and foreign business partnership programs under the auspices of the WCO Framework. Several countries are pushing their programs toward higher standards, and I would like to vigorously pursue the possibility of partnerships with these countries as soon as possible.

The Challenge
With all this progress over the past five years, and a new legislative mandate that maps the way forward, we have much work ahead of us, and some significant challenges. And one major challenge I want to highlight is post-incident business resumption.

Business Resumption
In the event that an incident impacts the flow of trade across our borders, we must have a well-developed plan in place to resume normal operations at the earliest possible time.

It doesn’t matter whether the incident is a terrorist attack, a natural disaster, or pandemic influenza: “Hope is not a strategy.”

In the event of an incident, we need to know who’s in charge, what to do, and how the communications will flow across the public and private sectors.

At last year’s Symposium, you discussed this briefly. This year, I wanted to make sure your concerns about business resumption are a primary focus, so we’ve devoted an entire panel to this important issue.

During the year, we’ve made great progress toward a comprehensive business resumption plan. Over the summer, we conducted tabletop exercises in Detroit with our sister agency in Canada—the Canada Border Services Agency—local law enforcement and members of the trade community. And we have plans for future exercises in Seattle and Tacoma this spring.

From these exercises, we learned some very important lessons.

First, it is essential that we have good communications and coordination among federal agencies, local authorities, and with you, the trade.

CBP is working to refine our incident management protocols. But we need to deepen the discussion regarding what you need from us in order to manage your operations.

Next, we found that your involvement in programs that improve the transparency of the supply chain, such as FAST, C-TPAT and ACE, also builds confidence that we can resume business quicker and communicate more effectively with our trade partners.

The improved risk assessment process that will result from initiatives like 10+2 and Secure Freight will be essential elements that help facilitate the post-incident resumption of trade.

Finally, we learned we must move as quickly as possible past our initial response to determine the source and seriousness of the incident. Is it an attack or an accident? And, are other attacks on the way?

I must point out that the government’s response will not be the same for every incident. It will be event driven. That’s why it’s important that we work together and communicate to understand what our individual responsibilities are in the overall plan.

But, here again, we must broaden our thinking about the threats that could shut down the supply chain. Avian flu or bio-terrorism could be our next challenge. Our plans must encompass any event or incident that could disrupt trade.

Conclusion
What I have learned from you in the past six months has given me great optimism that, together, we can meet all these challenges.

But, I also need to add one note of caution. The further we get away from 9/11, I believe one of our greatest risks is becoming complacent, losing our focus and letting down our guard.

The threat we face is real. The enemies of freedom have not gone away. We must continually guard against underestimating the lengths to which al Qaeda and other groups will go to destroy American business and American lives.

When we look back over the last five years, what we have accomplished to meet this threat—and the opportunities that exist to build on those accomplishments—are nothing short of miraculous.

You can be proud of the way you responded.

The systems you have built together make it far more likely that if an event disrupts our supply lanes—for whatever reason—you have built in safeguards, we can isolate the problem, and resolve it, without shutting the system down—and bringing down the economy in the process.

Five years ago, the trade took up the challenge of finding solutions to improve our security and moving more goods faster.

As a result, we have a whole new lexicon, a whole new way of talking about and conducting business.

We are putting 21st century systems in place that both secure and facilitate trade, and we have pushed out our borders and extended the hand of partnership to other governments and the trade community around the world.

We’ve deployed new technology and integrated databases and information that makes us safer and more efficient.

Our partnership with the trade is a testament to the remarkable progress that can be made when we work together.

And with your help, I am committed to continuing to find solutions that contain solid facilitation benefits for every security improvement, and solutions that help the U.S. become even more competitive in the global economy.

Our partnership IS the way forward. It IS the future—and we are the leaders and creators of the next generation of changes that will make our country more secure—the supply chain more efficient—and our economy stronger.

The men and women at CBP understand that the way forward is a challenge, but we also recognize that it is an opportunity, an opportunity to do even more to ensure that this nation—and its citizens—can live and work in a safe, secure and open America. Anything less is unacceptable.

Commissioner Basham reserves the right to edit his written remarks during his oral presentation and to speak extemporaneously. His actual remarks, as given, therefore, may vary slightly from the written text.