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American Shipper

Latin connection

Latin connection

WCO deputy secretary general wants South, Central American customs more involved.



By Chris Gillis




      The World Customs Organization has become the primary forum for customs administrations to pursue global standards for more efficient trade and border controls.

      While Latin American countries are members of the Brussels-based organization, their voice on customs matters has been largely mute compared to their brethren from North America, Europe, Asia and Africa.

      There are two primary reasons for the insufficient level of interaction by Latin American customs administrations within the WCO: lack of travel funds to participate in the meetings, and that Spanish is not one of the official languages within the organization, explained WCO Deputy Secretary General Sergio Mujica in a recent interview.

Sergio

      In fact, Mujica's appointment this year to deputy secretary general, after severing three-and-a-half years as head of the Chilean Customs Service, marks the first time in the WCO's nearly 60-year history that a Latin American was elected to a top post, in an organization dominated by English and French speakers.

      'I would like Latin America to become an active participant, and develop leadership in all subject matters that constitute major challenges for the international customs community,' Mujica said.

      'I intend to change this by working actively with the directors general in order to create a path toward this leadership, despite the resource and language limitations,' he said. 'The key aspect is to strengthen communication as a first step to improve involvement. The attach's at the embassies can also play an important role in those cases where customs officers are unable to attend the meetings personally.'



Multicultural. Since the 1990s, the WCO has made significant strides to become a more inclusive organization in terms of incorporating views and concerns of developing country members.

      When the WCO started in 1953, it was then known as the Customs Cooperation Council (CCC) and served as a central point where European customs directors general could meet to discuss issues and concerns of the day. The membership opened to non-European customs administrations in the 1960s and 1970s.

      At the same time, the CCC's role in shaping international trade activities increased with the development of the 1974 International Convention on the Simplification and Harmonization of Customs Procedures, or Kyoto Convention. The convention's purpose was to streamline basic customs operations to ease burdens on trade.

      The CCC also became the administrator of the World Trade Organization's Valuation Agreement. The original GATT Valuation Code was developed in 1979 to help eliminate arbitrary customs valuation practices, which hampered international trade at the time. The code established a policy of customs valuation based on the price paid for goods.

      In 1994, the CCC adopted the name World Customs Organization to reflect its role as a global intergovernmental institution.

      During this time WCO members faced the need for standards to accommodate rapidly changing trade practices, increased use of information systems and rising international cargo volumes. In 1999, the WCO responded to these changes by adopting the revised Kyoto Convention. Unlike the original convention, countries that ratify the new convention must accept and apply all the principles listed in the general annex, whereas before they could pick the aspects that best suited them.

Danet

      Meanwhile, the influence of developing countries in WCO activities continued to evolve. Michel Danet, a former two-term secretary general from France, often highlighted the concerns and considerations of developing countries during the drafting of the SAFE Framework of Standards, after the Sept. 11, 2001 terrorist attacks in the United States placed global emphasis on supply chain security.

      The outcome of the WCO secretary general election was another big step toward diversity in June 2008 when then Deputy Secretary General Kunio Mikuriya of Japan became the first Asian head of the organization.

      Today, the WCO comprises 176 customs administration members. It doesn't matter how large the country's customs or its influence within the WCO, one vote per member administration is cast during a council election.

      Developing country members want to ensure with their votes that the organization's future leaders represent their best interests. In addition, more technical officers, who oversee the WCO's day-to-day operations, come from developing country customs administrations.

      'I believe that the subject is more profound and should not only be measured on the basis of the number of positions held by a specific region,' Mujica said. 'It is also important to be leaders and participate actively in the discussions of the key issues discussed at the WCO. This is another challenge for Latin America.'



Public Servant. As head of Chilean Customs, Mujica participated in WCO Council meetings and the regional meetings of directors general. 'What attracted me the most to the WCO was the possibility of becoming involved in the main global challenges that customs agencies face,' he said.

      Mujica, now 41, said he realized while attending university that he wanted to enter public service. 'I was motivated by the need to contribute to recovering democracy following the government of Pinochet. Therefore, once I obtained my degree in law I had no doubt in working for the government, despite having some very good opportunities in private law firms,' he said.

      His first government job was working for the agriculture minister under President Frei. 'The minister asked me to advise him with respect to the introduction and review of all the bills put forward by the ministry, a task that required a thorough knowledge of both the technical aspects of the bills and the regulations related to passing a bill in Congress,' Mujica said.

      From 1997 to 1998, Mujica worked toward attaining a master's degree from American University in Washington. In addition to boosting his legal credentials, the opportunity allowed him to perfect his English.

      He returned to Chile and in 2000 was appointed to national director of the government's Fisheries Service, which enforces and controls all regulations applicable to Chile's prominent fishing industry. The agency also acts as the health authority and certifies all exports. Fish is the South American country's second-largest export commodity.

      'I gained extensive experience in all areas involved with foreign trade and, of course, I had the chance to collaborate closely with the Chilean Customs Service, especially in matters related to the foreign trade single window,' Mujica said.

      Following the administration of President Lagos, Michel Bachelet was elected president of Chile in 2006. The newly appointed vice minister for finance was aware of Mujica's work in the Fisheries Service and offered him the task of heading Chilean Customs. Mujica immediately accepted the post.

      Chilean Customs comprises about 1,300 officers and 16 customs districts with 15 points of entry across more than 4,300 kilometers of border.

      'Chile is highly interested in international trade. It's why we have so many trade agreements around the world,' Mujica said. 'We believe in international trade as a way to develop the country.'

      Previous to his appointment, Chilean Customs had already taken significant steps toward modernization. For example, all import and export declarations must be submitted electronically and risk management measures are in place. However, there were still important improvements to make.

      During Mujica's tenure at the agency, a law was enacted to create the Customs and Tax Courts. This way, the Chilean Customs director general ceased to act as judge, and customs cases were brought before an independent and specialized court. 'This is critical to provide legal certainty and credibility to the system as whole,' he said.

      Mujica oversaw the establishment of an advance publication system for proposed regulations, allowing the public to post comments online. This contributed to increased transparency and participation and also helped avoid errors prior to implementation of new regulations, he explained.

      The agency created a system to invite main clients and agents to submit improvement projects and modernization regulations in October of each year. Accepted proposals are included in an annual agenda that establishes the responsible parties and deadlines, he said.

      'Both of these initiatives ' advanced publication and the regulations agenda ' were highlighted by the IMF (International Monetary Fund) as best international practices, which was cause for pride among the officers of the entire institution,' Mujica said.

      From his WCO office in Brussels, Mujica has maintained a busy schedule since taking over as deputy secretary general at the start of the year.

      Secretary General Mikuriya instructed him to work directly with each of the three directorates within the WCO, namely Tariff and Trade Affairs, Compliance and Facilitation, and Capacity Building, under a rotation of every six months. However, due to the sudden death of Antoine Marie Manga Massina, the WCO's director of tariff and trade affairs, on April 24, Mujica has taken charge of this directorate until the election of a new director in June 2011.

      He has also become responsible for the WCO's Auditing Committee. 'Since the SG (secretary general) is in charge of the Finance Committee, it was deemed appropriate that I take charge of the Auditing Committee to separate the subject areas and increase transparency,' Mujica

said.

      The Audit Committee assists the WCO Policy Commission and Council in fulfilling their oversight responsibility with respect to:

      ' Overall implementation of the WCO Strategic Plan.

      ' Budget allocation process and performance measurement policies and practices of the organization.

      ' Efficient and effective program management and the attainment of Strategic Plan's objectives.

      ' Protection of resources and their efficient and effective application against stated priorities.

      ' Identification and mitigation of significant risks.

      His biggest and perhaps most difficult task will be to increase the involvement and participation of Latin America in the WCO. In addition to Mujica's post as deputy secretary general, the only other WCO officer from South America is from Brazil.

      In mid-April and early May, Mujica completed a sweep through South America to meet with the various customs directors general of the region, most of whom he had developed friendships with during his time at Chilean Customs.

      So far, with the exception of Cuba, no Latin American country has ratified the revised Kyoto Convention. The countries oppose the convention's rule that does not allow countries to have mandatory use of customs brokers to conduct clearance procedures.

      'While it would be great for Latin American countries to implement the revised convention, most of them are working on the standards and implementing its principles,' Mujica said.

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