sustaining progress on trade facilitation : how republic of korea did it
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Sustaining progress on trade facilitation : How Republic of Korea did it. Sang-Hyeon Jo Korea Paperless Trade Office , KITA. Table of Contents. Background of Paperless Trade Concept of Trade Facilitation APEC’s Trade Facilitation Agenda UNCITRAL model law for Paperless Trade - PowerPoint PPT PresentationTRANSCRIPT
Sustaining progress on trade facilitation : How Republic of
Korea did it
Sang-Hyeon Jo
Korea Paperless Trade Office , KITA
Table of Contents
Background of Paperless Trade Concept of Trade Facilitation APEC’s Trade Facilitation Agenda UNCITRAL model law for Paperless Trade
Paperless Trade in Korea Needs for Paperless Trade
Establishment & Dissemination of Paperless
Trading system
Legal framework & Expected benefits
Future tasks
Background of Paperless Trade
Concept of Trade Facilitation
Trade Facilitation
Impediments in general
Customs administration Standards and technical regulations Barriers to the mobility of business people
- Business facilitation
- Cutting red tape
- Simplification of procedural and administrative impediments to trade
Why is it difficult to implement?
Nevertheless, we have to go on. Why?
Concept of Trade Facilitation
1. Essential but not attention grabbing
2. Highly technical
3. Painstaking to reform
4. Expensive to implement
Trade Facilitation reflects the economy as a whole.
Based on APEC research it will add 0.25% of real GDP
to APEC member economies.
APEC’s Trade Facilitation Agenda
4 facilitation areas
Customs procedures Standards and Technical regulations Labor mobility e-Commerce
Importance of e-Commerce for Trade Facilitation
Having great potential by developed IT infrastructure Providing efficient electronic working environment Modernizing customs administration Reducing administration delays
UNCITRAL model law
UNCITRAL
United Nations Commission on International Trade Law Organization for enacting commercial law on
international
trade and transactions
ICTs - related Laws
Model Law on Electronic Commerce(1996) Model Law on Electronic Signatures(2001) Convention on the Use of Electronic Communications in
Electronic Contracts(2005)
* ICTs - Information and Communications Technologies
UNCITRAL model law
Merits of the e-Trade Platform Reducing trade-related costs Simplifying administrative processes
Establishment of the e-Trade Platform Principal agent
Formal agreement defining roles & responsibilities End user agreements
Governmental Organizations
Private Businesses
Joint project by Public-Private Partnership
UNCITRAL model law
Processing data
: mechanism must be commonly mutually recognized
Identification Authentication Authorization
Data protection
: compliance with all relevant privacy and personal data
protection laws
Access to data Integrity of data Accuracy of data
UNCITRAL model law
Liability issues
Proper logging mechanisms
- preventing reuse of wrong data
- clarifying mistakes and forgery
Electronic signature
- security mechanisms
Electronic documents
- functional equivalence of electronic documents to paper documents
- acceptance of their evidentiary value in court
Paperless Trade in Korea
export
import
Needs for Paperless Trade
Establishment & Dissemination of Paperless Trading System
Milestone of Paperless Trade in Korea
Trade Automation Act(1989) For national competitiveness by cutting costs through automated
transaction system
Establishment of KTNET(1991)
A 100% investment holding subsidiary of KITA Implementing IT based projects between public and private sector the sole designated system operator for uTradeHub a service provider of the national paperless trade system
Promotion by public opinion Consensus on online paperless trading system for easy access
for work efficiency
Project for building a paperless trading system Adoption as one of the e-Government projects Aim : transferring VAN EDI-based trade automation system to
Internet-based trading system
National e-Trade Committee (established in 2003)
Establishment & Dissemination of Paperless Trading System
Paperless Trade Governance in Korea
Establishment & Dissemination of Paperless Trading System
Establishment & Dissemination of Paperless Trading System
Korea Paperless Trade Office Established in 2005 The secretariat and PMO(Project Management Office)
of the National Electronic Trade Committee consolidation between public and private sectors
KITA (established in 1946) Korea International Trade Association Korea's foremost trade promotion organization with
65,000 member firms Supporting Korea's business community WTCS(World Trade Center Seoul), an access to one-stop business
Concept of uTradeHub
Establishment & Dissemination of Paperless Trading System
Course of ActionsCourse of Actions
Phase2Phase2
(’06(’06))
• Build a trade portal for traders License/Certification/Clearance support system
• Standardize documents ebXML based document standardization
Phase1Phase1(‘04-’05(‘04-’05)
• Build Core Infrastructure of e-Trade Platform
u-Trade document circulation system
e-L/C service system
• Establish e-Trade Platform, uTradeHub for all the trade related communities
Link systems of banks, logistics and many other
related organizations
Phase3Phase3
((’07~ )’07~ )
Establishment & Dissemination of Paperless Trading System
Government
Related Parties
Trading Partner
TrustedThird Party
• Policy & Law
• Funding & Execution Roadmap
• Project Leadership & Ownership • Integration
• Standardization Body
• Process Innovation
• Paperless Trading
• Enterprise IT Systems
• Service Development
• Platform Operation
• Global Network
Establishment & Dissemination of Paperless Trading System
Public – Private PartnershipPublic – Private Partnership
Digital Signature Act
Trade AutomationAct (1991)
e-Trade Facilitation Act
(2005)
CommercialLaw (2007)
Foreign Trade ActForeign Trade ActElectronic Electronic
Transactions Transactions Act Act
Legal framework
Legal framework
Foreign trade Act(1986)
- revised in 2009
e-Trade Facilitation Act(1991)
- revised in 2009
Digital Signature Act(1999)
- revised in 2008
Electronic Transactions Act(1999)
- revised in 2009
Commercial Law on electronic Bill of Lading(2008)
Productivity Increase
Reduction of extra fees
Reduction of redundant investment in the IT sector (318million USD)
Reduction of labor costs (263.3million USD)Reduction of labor costs (263.3million USD)
Reduction of printing costs (19.1million USD) Reduction of printing costs (19.1million USD) Reduction of circulation and storage costs(271.9million USD)Reduction of circulation and storage costs(271.9million USD)
Reduction of warehousing costs (1.36billion USD)Reduction of warehousing costs (1.36billion USD)
Reduction of inventory management costs (750million USD)Reduction of inventory management costs (750million USD)
Productivity increase [554.3million USD] + Reduction of extra fees [2.11billion USD]
+ Reduction of redundant investment in the IT sector [318million USD]
Expected Economic Benefits
LG ELECTRONICS
Reduced Labor costs, documents handling charges, etc. by 30mil USD for a year
SAMSUNG ELECTRONICS.
Reduced labor for the customs clearance department by 50% : 89 persons → 43 persons Shortening of working hours and process simplification : 25days → 5days, 53steps → 17steps
INTERFLEX
Reduction of extra fees for trading : 29,000 USD → 9,160 USD
Shortening of the time required : 12hours → 30mins
DAEWOO ELECTRONICS.
Shortening of handling hours for shipping requests : 22mins per → 6mins per
Cost saving cases in Paperless TradeCost saving cases in Paperless Trade
Expected Economic Benefits
Future tasks
1. By a commitment of government for effective e-Commerce infrastructure
2. By simultaneous reforms in a number of sectors
3. By systems integration based on Public-Private Partnership
4. By entire trade transaction cycle ; not standard harmonization or customs modernization alone
5. By helping developing countries for entire systems integration
How to find unexplored synergies in Paperless Trade
Future Tasks
Why is Joint Project essential for e-Trade?
- Consideration linking e-Trade Platform of each country
- International support is necessary based on public and private partnership of each country
- we need to define where we can initiate joint projects
Joint projects
Cooperation among countries
How do we build a partnership in borderless trade?
- Information sharing efforts about legal frame and IT infrastructure
- Constant progress reports of each project
Future Tasks
www.utradehub.or.kr