U.S. industry worries trade taking back seat to security

U.S. industry worries trade taking back seat to security    A panel of U.S. shipping interests warned Senate lawmakers that the efficient flow of trade has increasingly taken a back seat to cargo security within Customs and Border Protection.
   The industry supported efforts to strengthen cargo security measures during the immediate aftermath of the Sept. 11, 2001 terrorist attacks in the United States. Now they believe it’s time to bring the components of security and trade facilitation back into balance, a concept initially promoted in the 1993 Customs Modernization Act.
   “Achieving this productive balance between these roles is a vital national interest and it is critically important for the United States to remain competitive in the global marketplace,” said Marian Duntley, chairman of the American Association of Exporters and Importers, and corporate customs manager for Toyota Motor Sales USA, in testimony before the Senate Finance Committee on Wednesday.
   According to Peter Powell, chairman of the National Customs Brokers and Forwarders Association of America, there are fewer CBP import specialists available to address day-to-day issues for small to medium sized U.S. importers. Many CBP officers have had their roles shifted from trade facilitation to cargo security duties after 9/11, he said.
   Brian Monks, director of anticounterfeiting operations for Underwriters Laboratories, told the Senate committee that the war on terrorism has even distracted CBP officers from sufficiently cracking down on importers of counterfeit merchandise.
   “Make no mistake — we are in a battle,” Monks said. “Product counterfeiting threatens health and safety, undermines the economy and funds organized crime and terrorism.”
   Senate Finance Committee Chairman Chuck Grassley, R-Iowa, and Ranking Member Max Baucus, D-Mont., expressed concerns about CBP staffing for trade facilitation in their opening remarks to the hearing. The Homeland Security Act promised adequate staffing levels for customs revenue functions in the Homeland Security Department.
   “Yet, between March of fiscal year 2003 and March of fiscal year 2006, staffing levels have declined in key job categories at Customs and Border Protection as much as 16 percent,” Grassley said. “That’s not to say that the management of customs revenue functions can’t change over time. But, it does raise a concern that our customs revenue and trade facilitation needs are not being fully met.”
   Baucus said “pressure is tremendous to focus on security at the expense of trade.
   “I am concerned that, from personnel to ports, our customs infrastructure may not be keeping pace with the growth in trade,” he said. “The Bureau of Customs and Border Protection has added much-needed officers. But it has far fewer staff allocated to trade facilitation and enforcement today than it did 10 years ago.”
   Jayson P. Ahern, assistant commissioner for CBP’s Office of Field Operations, acknowledged to the committee that staffing changes and retirements have had some effect on the agency’s trade operations.
   Ahern explained that more than 64 percent of the field import specialist group is assigned commodities with “priority trade issues.” For instance, 317 import specialists are dedicated to the enforcement of textile rules and 220 handle agricultural products. The remainder handle a variety of commodities under antidumping and countervailing duty implications, such as softwood lumber, bearings, steel and bedroom furniture, revenue and intellectual property rights.
   “To that end we have initiated various training opportunities to expand the skill sets and make these functions more effective and efficient,” Ahern testified. “The basic import specialist training curriculum has undergone a major review and updated accordingly.”
   Industry officials emphasized the continued need for CBP to complete the development of its Automated Commercial Environment and multiagency interface program, known as the International Trade Data System.
   In fiscal 2005, CBP processed more than 28 million trade entries and collected revenue exceeding $28 billion. The agency processed and cleared 25.3 million sea, rail, and truck containers. CBP also seized about 2 million pounds of illegal drugs.
   “The overwhelming burden of coping with 28 million entries and 754,000 consignees is rationally addressed by a ‘trusted account’ program which assures that CBP knows the importer, has validated its credentials, has internalized its expected and repetitive patterns of trade, range of commodities and internal compliance programs, validated its security measures and identified its logistics partners,” said Jerry Cook, vice president of Sara Lee Branded Apparel, in his testimony.
   Cook said other important trade-related programs in need of implementation and refining are Customs-Trade Partnership Against Terrorism, “green lanes,” monthly transactional processing, post-entry compliance, pre-entry security and complete automation of all processes.
   He added shippers are aware that security rules will continue to evolve.
   “It is paramount that these rules be crafted to match the real world environment in which trade takes place, and that they be capable of evolving to match the changes in trading systems,” Cook said. “We believe this can only be achieved though a growing partnership with the trade community, allowing the government to understand and take into account and capitalize on the needs and systems of the commercial interests operating in and through our ports of entry.”