CUSTOMS AND CIRCULAR ECONOMIES
The working and administration of the Customs is always styled after prevalent system of international trade and economies. With removal of trade barriers (both tariff and non-tariff), introduction of neoliberal market models and FTAs, Customs’ role has transformed from that of “Preventive Service” to the Customs that vanguards economic borders and facilitates the trade.
In today’s world, where market competition has replaced military conflicts, the role of Customs as a whole has not only increased but has become significantly inevitable. In case of Pakistan, the Customs administration has styled itself to perform multiple functions at the same time.
Apart from regulars Customs works of regulating trade and transit, countering smuggling and promotion of exports, Pakistan Customs has also given the country a boost as a circular economy by encashing cheap labour and domestic industry available as a support to the other economies of scale.
A circular economy is the one that, among others, recycles the scrap and transforms it into a semi-finished product for further use by industries, industrial economies or the economies of scale for manufacturing of fine products that could compete in the international market.
It is also noteworthy that about nine percent of the world’s economy consists of circular economies.
Existing level of development of Pakistan makes it just the right economy to act as circular economy within the foregoing meaning. With this opportunity available and knocking at the door, Pakistan Customs has much to offer to enable smooth treading towards this path of development. However, for sake of the instant paper, role of automation, comprehension and clearance and advance ruling system will be explored.
Since it is work of a circular economy to turn scrap of different resources i.e. metal, fabric, plastic etc., into usable things or semi-finished products, Pakistan has become a notable importer of iron and steel scrap / waste from United States, Germany, United Kingdom, Japan, Netherlands and others.
For quick clearance at the import stage and subsequently at the export stage, Pakistan Customs has, its all encompassing, indigenously built software system “WeBOC” in place.
All consignments of scrap arriving into Pakistan are processed through paperless system of WeBOC, where traders have option to file goods declaration on their own or through their authorized Customs agent. The system checks all the trade through its trader profiling system called “RMS”, to screen out any delinquent individual and keep the flow of trade continued hassle free.
WeBOC is a Customs clearance system that handles all exceptions and can make intelligent decisions itself. The traders, therefore, get a great experience of processing their consignments and get those cleared from port after fulfilling all their legal formalities and pay all applicable duty and taxes online.
This smooth running of the system further speeds up with the comprehension and quick clearance of the cargo meant for recycling. For making it possible, it is indispensable that capacity and understanding of officers and staff of Pakistan Customs is further built and groomed in such a way that it could handle any such revolution and interpret the laws for greater benefit of the country and in a facilitative manner.
Moreover, it becomes very important for Customs to know its clients — traders / importers / manufacturers / manufacturer-cum-exporter etc., as knowledge of trader and his profile helps the department have clear picture and make decisions about a trader / individual.
Most recently it has also been noted that a Customs administration with clear comprehension of business process / engineering of the goods being imported or exported greatly benefits the trade. In this context, the discretion is used wisely for clearance and furtherance of trade and ultimately the economy of the country.
This use of discretion is mandatory in today’s world, when every now and then new things and events pop up in domestic and international markets and requirements of the world changes and increases quickly.
If an officer of Customs is well-equipped with the process of the business, he can be at a better position to examine the importer goods / scrap and handle the exceptions with his own knowledge to identify whether any sort of scrap could be used for the industry / business it is meant for or not! Therefore, equipping Customs officers with this training / knowledge not only facilitates the trade but the risk profiling is also done in the same coin.
Valuation rulings of various items of scrap have been development by Pakistan Customs in advance. This specific thing resolves a host of issues faced by government and the traders alike at the time of clearance of goods.
It may also be noted that most of the duty / taxes at the import stage are ad valorem and has government interest inseparably attached to those; therefore, at times, the issues of valuation of certain goods turn so bitter and indecisive that issues end up in the competent courts of law for resolution. Pakistan Customs’ foresightedness has helped prevent any such issues in administering the clearance of goods. In the year 2021 alone, valuation directorate of Pakistan Customs issued various valuation rulings, wherein a number of items of iron and steel scrap were covered.
This not only helped importers self-assess duty and taxes that would be applicable on types of the scrap purchased by them or is in the sea, but also created certainty of price / cost to remain competitive in the market.
Caravan of development doesn’t end here, but it could rather be an initiation of something better for the country. In today’s time, when human being are rapidly consuming the raw material being extracted from the mother nature, recycling and reusability of products and materials that compose it cannot be ruled out. Pakistan is becoming an economy that purchases the scrap, processes it and turns it into semi-finished product.
These products are then exported into world markets / developed countries for further processing. In this sequence of events, it is very essential that policies are devised without delay for development of our domestic industry and human resource that the country might become potent enough to turn different types of things scraped by other countries into valuable and finished products and market the same in the world and become a great exporter of recycled goods. Again in this process, the role of Pakistan Customs shall always remain inevitable and matchless!