Let’s Build the Future of Customs together
After being elected in December 2017, I joined WCO as soon as January 2018. Since my arrival, I have focused on reinventing and providing relevance to the role of the DSG and the Organization itself.
I have made a priority to keep Members informed and engaged with WCO activities. Besides keeping close relation with Members, I have coordinated and developed communication bridges among directorates to approach matters in a more integrated manner. During this time, the support and hard work from the Secretariat´s Staff has been a key factor.
During the election process, I committed with Members to work closely with them and to focus in four priority areas:
1. Development of new strategic plan
2. Review of the Revised Kyoto Convention (RKC)
3. Performance Measurement
4. Organization`s governance, specially term limits for elected posts.
In June 2018, Council approved my proposal to carry out six regional workshops on strategic planning to develop the new Strategic Plan 2019-2022. In the second half of that same year, I visited all six regions and listened to Members priorities and needs to incorporate them for the first time in an inclusive Strategic Plan.
As a result, WCO moved from having a complicated strategic plan that considered over 90 key performance indicators (KPIs) and over 70 tactical activities with no clear priorities and that Members could not monitor, to a high level policy document with a consensus strategy considering only 29 relevant KPIs and 9 clear priorities.
An important change in WCO Strategic Planning is the introduction of a monitoring tool that allows Member to follow up on the implementation of the strategy and managing it as a continuous process. This is relevant because Members and the Secretariat worked together for the first time in developing the Organization`s Strategy while providing it with an evolving and flexible nature allowing it to adapt to uncertain times.
In June 2019, WCO Council approved the new Strategic Plan 2019-2022 which presented a completely new methodology with a reduced number of KPI `s, while keeping only the necessary and relevant ones. The new Strategic Plan is a document that serves now as a monitoring tool of the action performed by the Secretariat and calls for concrete actions and deliverables.
The 2019-2022 strategic plan, although developed in an extremely limited time, represents an incredibly positive and drastic change. Currently a new process is ongoing, and the strategy needs to adapt to new circumstances post COVID-19 besides introducing and identifying a clear link with the environmental scan. The cost allocation process has also changed to a more transparent one.
After its approval, the strategic plan is no longer a document to be kept in the drawer for three years, it is intended to serve as a monitoring tool. As part of the permanent process, the strategic planning methodology now follows the alignment of the structure, a new evaluation and adapt to new needs. As a continuous process, the strategy is also now a flexible product that can be adjusted to emerging threats and opportunities.
December Policy commission in 2019 was held in Seoul, Korea and touched on different items such as cruise ships, e-commerce, communication strategy and strategic plan. To better link and feed the Organization´s strategy, discussion on the way forward for the use and drafting of future environmental scans was carried out. Also, the new communication strategy, aligned to the 2019-2022 Strategic Plan, was discussed. I presented, the first ever online monitoring tool on the implementation of the Strategic Plan 2019-2022 providing Members with transparency and tools on the tasks performed by the Secretariat.
The beginning of 2020 came with many challenges. With the emergence of the health emergency due to COVID-19, the strategy and its implementation plan had to adapt to new priorities and new ways of working. June`s Policy Commission was cancelled, but the impacts on the implementation Plan and its costs were discussed in the virtual sessions of the Finance Committee and Council.
For the November Finance Committee and the December Policy Commission and Council Sessions, which are expected to be virtual again, and once there is more information available on the impact of the pandemic, a new document with several possible scenarios will be discussed.
New regional workshops are also planned for the second half of 2020 as part of the foresight exercise and environmental scanning to develop the next strategic plan.
I will keep you updated on the coming steps and progress done to build a new post COVID-19 Strategy!
COMPREHENSIVE REVIEW OF THE RKC
The Revised Kyoto Convention (RKC) has been a key instrument for Customs administrations in promoting trade facilitation and effective controls through its legal provisions.
Since 1999, when the WCO Council adopted the current RKC, the WCO has developed a number of tools responding to significant changes in the international trade environment as Customs community.
For example, in June 2005, SAFE Framework of Standards was established in order to meet the new Customs role in security. In 2019, Framework of Standard on cross border e-commerce was developed to meet the urgent needs to establish international rules to better handle increasing e-commerce volumes and the associated vulnerabilities. WCO Single Window and Data model have been developed in order to support the intensive use of IT solutions and interoperability to facilitate data exchanges among Customs and border agencies.
Guidelines for rules of origin were delivered to ensure proper and fair application of free trade agreements (FTAs).
The RKC Management Committee (RKC/MC) has discussed, from time to time, the need for a potential revision or updating of the RKC in the light of developments in the Customs and trading environment in the last 20 years.
Members perceive a need to further facilitate trade for better market access opportunities, by including core elements of WCO tools into the RKC as binding provisions. In this regard, monitoring mechanism embedded in the RKC is also regarded as beneficial for proper implementation of the binding provisions.
Furthermore, the RKC along with related WCO tools had been greatly relied on during the development of the WTO’s Trade Facilitation Agreement (TFA), and the RKC is practically and professionally supporting TFA’s implementation.
However, TFA implementation could be negatively impacted if each Customs pursues its new role on safety and security while struggling the huge increase of cargoes, in non-harmonized and inefficient manner. It is essential that the RKC, as a key and practical instrument for Customs, will properly and timely respond to the changes in harmonized and efficient way by inclusion of modern practices to further facilitate international trade.
Due to all this, after thoroughly discussing the impacts and objectives, in 2018, the RKC/MC unanimously endorsed the review of the RKC in a comprehensive manner and in the June 2018, Policy Commission/ Council approved the setting up of the Working Group on the comprehensive review of the RKC (WGRKC).
As part of this exercise, on November 2018 the WCO hosted the Global Conference on the Comprehensive Review of the RKC. The delegates shared their thoughts on the factors having major impact on the effective implementation of the Convention and the benefits of a robust monitoring mechanism for Members, for the WCO and for the private sector.
From September 2018 to October 2020, the WGRKC will have held eight meetings and will have intensively discussed over 130 proposals of 34 concepts submitted by Members and external stakeholders. While covering wide range of topics, main focus of these proposals is about how to adequately capture the new Customs role by adding core elements of WCO tools in the RKC, as follows.
By 2020, the WGRKC will have concluded two main tasks:
1. Gaps and needs analysis and concept-based proposals; and
2. Examining each Chapter in order to identify possible changes by capturing possible concepts.
After this, the WGRKC would have concluded its mandate and the next steps should be conducted by the RKC/MC which basically will focus in developing draft texts as the changes to the RKC. This work is estimated to take close to 2 years, so there is still a lot of discussion going on.
Recently, there has been strong support and willingness of the Member administrations on the development of a performance measurement tool as the source for monitoring and evaluation of implementation of WCO instruments and tools. WCO’s Conventions, instruments, tools and recommendations are designed with the aim of improving Customs administrations’ performance. Therefore, it is also expected that measuring compliance with WCO´s Conventions, instruments, tools and recommendations (monitoring the extent to which they are applied and effectively implemented) is also an indicator of the performance of Customs.
At the Policy Commission in June 2018, Members recognized “the need for Customs to take ownership and begin to conduct self-evaluation, preferably using a performance measurement tool developed by the WCO”. Delegates also stressed that “the Organization should have its own robust, comprehensive and fully scientific methodology for performance measurement, thus ensuring that the product is recognized politically”, being the “undisputed standard” for measuring Customs performance, covering all major Customs competencies and going beyond the Time Release Study.
Following the June Policy Commission, the WCO Secretariat conducted a preliminary review of relevant initiatives and perspectives that could help guide the way forward. The review included a study of existing tools and initiatives both within the WCO as well as those maintained by other international organizations.
A paper on Monitoring/Evaluation of Implementation of WCO Instruments and Tools was elaborated and presented for the consideration of the 80th Session of the Policy Commission in June 2019. The paper outlined the main findings of the review; drew links between performance measurement and monitoring of implementation of WCO instruments and tools; and identified some options for the way forward, including the formalization of a Performance Measurement Working Group.
The Policy Commission expressed an overwhelming support for pursuing the work on the development of a performance measurement tool for Customs administrations. The comprehensive reports on the discussions of the three breakout groups’ provided feedback on a wide range of related issues : having all Customs competencies included in the new envisaged performance tool; having the Customs perspective included in the different existing performance measurement tools; the preference for a benchmarking approach as opposed to a ranking one; the use of an IT platform and modern technologies for automated data collection and validation; and the involvement of external stakeholders for the quality assurance and credibility of methodology.
The terms of reference for the Performance Measurement Working Group were approved considering its main purpose and scope to develop a comprehensive performance measurement mechanism (PMM), including key performance indicators (KPIs), both quantitative and qualitative, in all Customs competencies (revenue collection, trade facilitation and economic competitiveness, enforcement, security and protection of society, etc.) as well as mechanisms to monitor and measure the implementation of such indicators. In addition, indicators for this assessment should monitor the extent to which WCO tools, instruments and recommendations have been applied, as well as support their evaluation in line with emerging international practice.
The first meeting of the working group set the tone of the important challenge in the process of establishment of the WCO PMM. As a Members-driven organization, the meeting was conducted in a way of dynamic dialogue demonstrating high level of interest from the Members in the process of establishment of a politically recognized evidence-based, scored assessment mechanism that would enable strategic and evidence-based policy-making process in Customs administrations. A work plan was endorsed, and intersessional work is key in fulfilling the objectives.
Following and reviewing our and other existing international practices, it is of utmost importance to have a critical mass of participation from Members to effectively achieve the goal and objectives of the WCO PM and meet the expectations of the international customs community.
The second meeting of the PMWG was schedule for May 2020, but due to COVID-19, the meeting had to be postponed and will now be held in two phases completely virtually: during September we are now having paper based consultations and in October we will have our virtual on-line meeting for the Members to take decisions on the way forward.
Additionally a series of regional workshops is programmed for the coming months, the first one in Europe was held during the last week of September in a completely virtual manner, thus allowing the WCO and its Members to keep connected, despite the COVID-19 emergency.
During the election process, several Members expressed their concerns regarding governance matters, specially the lack of limits for the elected posts of SG and DSG. I committed to these Members that I would pursue a change in WCO governance to stipulate a two-term limit on each of these positions.
Together with the team of the Secretariat, we worked on a proposal on this terms that was presented, discussed, and approved by the Council in its 2019 session.
Further analysis and discussion are needed in other governance matters, including working methods, funding, structure, etc. It is important to engage on this topic to develop a comprehensive WCO reform in the coming years.
For more information on some of my proposals to modernize and reform the governance of WCO, please follow me and take a look at some of my posts in the “Articles” section.
Coordination with other IOs
I have worked in strengthening strategic high-level relations with other international organizations such as WTO, OECD, UNCTAD and others
I have applied this same approach with other stakeholders such as the private sector through the Private Sector Consultative Group and the academia through the PICARD programme.
I have represented the Secretariat in the Audit Committee since its 2018 session and the Committee since then has made some improvements regarding the quality and focus of external audits.
As a Member following up the important work done by the Secretariat, I had several conversations with different colleagues about the real impact WCO has on its Members and in society in general; therefore, an audit on the impact of Capacity Building projects was proposed in 2018 and accepted by the Audit Committee.
In 2019 the external audit was agreed to focus on updating the risk matrix for WCO and in 2020 the external audit will analyze the risks of losing expertise and talent management.
Another new task for the Audit Committee, starting 2019 is to perform a review in the implementation of the strategy to verify and monitor the progress done in completing the estimated tasks.
In 2019 and 2020, discussions on the process and objectives that the signature of MoUs should follow were carried out. It is expected to have a final MoU policy approved by the Council in December 2020.
Private Sector Consultative Group
Engagement with the private sector is of high relevance to the work done in customs. We need a healthy private sector for custom administrations to fulfill its objectives. Under this perspective, I have engaged with WCO`s PSCG constantly, not only sharing the work done by the WCO but also listening to their requests and experiences.
Particularly important was the weekly meeting held with the PSCG during the COVID-19 emergency. We were able to exchange views on the existing situation and relevant recommendations came out of this dialogue that allowed WCO and its Members to better face this difficult period.
Since late 2019, I took over the Research Unit helping on the process to reinvent the environmental scan and linking it to the strategic plan. Although the Research Unit has extremely limited resources, it has since then published, besides the traditional annual report, an article on free trade zones and another on cross-border waste.
In the past recent months, with the support of the Korean Government, we started the development of different Data Analytic algorithms that have been published in the Members Only section of WCO website to implement in their risk management process. This is known as the BCUDA project and it aims to provide our Members with additional tools to become data-driven administrations.
The Research Unit should gradually turn into the “brains” of the organization, aiming to detect potential risks and emerging trends to convert them into strategic objectives in the Organization’s doing.
From January to September 2019, I had to combine my DSG Role together with Capacity Building Director post. During this time, I had the opportunity to assess in more detail the capacity building initiatives and concluded that the capacity building strategy needed to be updated.
Together with the Capacity Building team we developed and proposed a new Capacity Building Strategy considering relevant elements such as the role and objectives of regionalization, the need to measure impact of capacity building initiatives and the addition to the capacity building process of a follow up phase to monitor the improvement of beneficiary members.
I have always thought that one of WCO’s strength is its vast net of experts. This is one of WCO`s main assets and the new strategy needed to focus in efficient and productive expert management.
Capacity building needs are growing every day, but WCO resources are limited and therefore, the new strategy needed to integrate the matter of external funding strategies. This is something that need to be discussed thoroughly in coming months.
All Rights Reserved by Ricardo Treviño Chapa.