Having to make customs declarations on only one side of the border without repeating the same tedious process across the border is every importer's and exporter's dream. The Uganda Revenue Authority (LIRA) and the Kenya Revenue Authority (KRA) are involved in a project that will make this dream come true.

The East and Central Africa Global Competitiveness Hub (ECA Trade Hub) IT Corridor project, funded by USAID, is working jointly with East African Revenue Authorities to implement an international ICT Corridor along the Northern Corridor. This will enable information about declared goods to be immediately transmitted from point of commencement along border points on the Northern corridor so that Customs officials can make the necessary arrangements to clear and verify goods in international transit. For example, information about declared goods in Mombasa will be almost instantly available to the LIRA in Malaba and Kampala

"The idea is to do everything on one side of the border," says ECA Trade Hub Consultant, Michael Smith. "We need to manage the flow of information from customs declarations and in the end we will lower the cost of goods and increase East Africa's competitiveness."

The project comes after the successful introduction and use of modern computerised customs systems in East Africa, which reduced corruption and speeded up the process of clearing goods.

More substantial gains from the ECA Trade Hub project are likely. Resident Specialist, Athman Mohamed, says the project will also create greater transparency, increasing the ability to detect incidents in which goods have been received in transit countries' markets after being released at the port of entry without payment of duty.

"Currently the information declared in Mombasa is sometimes different from what is received in Malaba. We need to reduce human intervention and to improve customs data transmission from revenue authority to revenue authority. This should assist in the protection and increase of revenue collected by customs," he says.

The project is expected to go live in Uganda and Kenya from the end of February, followed by Rwanda later this year. For the first two months, only the big clearing and forwarding companies will use the system on a pilot basis to help move their huge volumes of cargo.
Edward Ichung'wa, an ICT specialist working on the project, says the initiative began with a survey in June 2005 and implementation in June 2006. Since then it has gained a lot of acceptance from KRA and URA.

According to Ichung'wa, "It has also gained a lot of acceptance from landlocked countries because initially they had no idea what goods were in transit before they got to the border." The project is expected to help such countries improve internal processes like risk management and determining beforehand what to inspect and allow in."

Ichung'wa says the information, which is generated at the first port of call, helps by cancelling transit bonds and granting landing certificates speedily so that the importer's money is not tied up in bonds until the goods reach their final destination.

"We are also working on a regional bonds scheme so there will be no need to get collateral in all the countries that the goods go through." If goods go through three countries, importers will immediately save two-thirds of the money they normally spend on bonds. This could translate into a savings of up to one-third of the $1bn of potential investment capital currently held in national customs bonds within the COMESA region.