about the author - amazon s3zhan… · about the author associate professor, shanghai customs...
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About the author
Associate Professor, Shanghai Customs College
WCO Accredited Customs Expert in ROO (first phase)
Commissioner of China National Customs Origin
Supervision Technique Committee
Phd in Law, Post-phd in economics
Visiting scholar in CCES in 2013
Expertise: Customs Supervision and Control, Rules of Origin and International
Commercial Laws, FTA
01
02
03
Development of ASEAN-China FTA
Impact on Regional Trade in Goods
Utilization of FTA Preferential Concessions
04 Challenges for Customs
ACFTA: 10+1>11ACFTA=ASEAN Association of Southeast Asian Nations (10) + China 1
Full implementation 2002
2005
2007
2010
Trade in goods
Trade in services
Framework Agreement on ComprehensiveEconomic Cooperation
ASEAN-China FTA: 10 years back
No. 1 in terms of population
No. 3 in terms of nominal GDP
No. 3 in terms of trade volume
Significance of ASEAN-China FTA
ACFTA: Surging Trade Volume
Source: China Statistics Yearbook
Trade Volume in ACFTA (1994-2010)
ACFTA: Trade Pattern
Both rely significantly on American and
European Markets
More competitive than complementary
Traded products: labour-intensive goods and low
added value under HS Chapters 84, 85 and 27
Trade with Singapore is more complementary
Trade Volume and Balance
Trade Volume and Trade Deficit of ACFTA (2002-2010)
Source: China Statistics Yearbook, Unit: $ billions
Top ASEAN Trade Partners
Top 4 Trade Partners with China and Trade Volume (2004-2010)
Source: China Statistics Yearbook, Unit: $ billions
ACFTA utilization rate in China
Keep steadily increasing year by year since
2005
Still behind the expectation of China government
Rose from 0.7% in 2005 to 13.2% in 2010
Much lower than 40% utilization rate in NAFTA
Utilization of FTA Concessions: Export
China Exportation Utilization of ACFTA (2005 to 2010
Source:General Administration China Customs (GACC) and General Administration of Quality Supervision, Inspection and Quarantine (GAQSIQ)
Utilization of FTA Concessions: Import
China Importation Utilization of ACFTA (2008 to 2010)
Source:General Administration China Customs (GACC) and General Administration of Quality Supervision, Inspection and Quarantine (GAQSIQ)
Utilization of ASEAN Members
Import UtilizationRate
2008 2009 2010
ASEAN 9.5 % 15.8 % 19.3 %
Countries
Thailand 11.7 % 25.8 % 33.2 %
Vietnam 12.0 % 26.5 % 27.7 %
Indonesia 10.4 % 15.8 % 23.7 %
Myanmar 28.5 % 20.7 % 21.9 %
Singapore 11.7 % 15.9 % 18.9 %
Malaysia 8.7 % 10.2 % 11.2 %
Cambodia 0.4 % 13.9 % 9.2 %
Philippines 2.5 % 4.3 % 8.3 %
Brunei 0.00008% 0.4 % 6.1 %
Laos --- --- 0.4 %
Performance of Import Utilization Rate of ASEAN members
Source:General Administration of China Customs (GACC)
On ROO Negotiation
Rules of Origin are the core issue of FTA
negotiations on goods and also the urgent issue
asking for capacity building
Rules: too strict or loose
NAFTA model or EU model
�40% Regional Value Content (RVC) to
�Change of Tariff Classification + 40%RVC�
mixed criteria
On ROO Formulation
� Specific origin rules also ask for amendment
- Minimal operations an processes
On Origin Certificate Issuing
� Authority is not Customs and lack of knowledge
� Mistakes in FORM E
� Lack of training for issuing officials
� Self-certificate is not allowed.
� Consideration of WCO SAFE and AEO
Challenges on Verification
� Misusing in good faith
� Counterfeiting and fraudulence
� physical investigation
� Electronic verification system is not available
� Cost of administrative cooperation
� Weakness of export control
FTA for Customs: trouble or Opportunity
� Challenges- Reduced duty & revenue collection
- cost of capacity training for the local Customs and especially the on-field officials
- new infrastructure, particularly the risk analysis and management system
- independent branch composed of FTA experts
� Opportunity - more involved in the national trade policies� formulation
- capability in impacting the policies of domestic industry protection
- better inter-agency relationship with other domestic competent authorities
- learn better to protect community
Findings and Conclusions
� Regional trade under ACFTA is expanded rapidly and trade relationship
is more competitive.
� To increase utilization rate, partners need to develop regional industry
chains and complementarity among bilateral traders.
� Besides challenges on implementation and administration, FTAs also
brings opportunities for Customs.
� Customs should adjust relevant rules and procedures in order to
promote trade facilitation and utilization rate.
� Capacity building is urgent both for officials, traders & issuing bodies.
� Value of the WCO Guidelines on Preferential Origin Verification
Discussion Points
Q1: For Customs in developing countries, duty collection is one important responsibility. With development of FTAs, fewer duty and revenue could be levied due to tariff concession arrangements. What is the sensible attitude for Customs towards FTAs? Welcome or refuse?
Discussion Points
Q2: To establish electronic certificate verification system among FTA member countries will improve the accuracy and efficiency of the origin verification. In your opinion, what is the feasibility to establish such a system in CAFTA?
Discussion Points
Q3: How do you evaluate the administrative cooperation among CAFTA countries? What measures could be taken to strengthen the Customs cooperation?
Discussion Points
Q4: While calculating FTA export utilization rate, the data should rely on the assistance of the other import country. Since only the import side has actual statistics of traded goods that given tariff concession. Each country�s import utilization data is a very important reference for other members� export utilization statistics. How to better share those data?
The value of knowledge lies in sharing!
Shujie ZHANG Deputy Director Department of Training & International Cooperation Shanghai Customs CollegeTel: 86 21 28991073 [email protected]