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Combating Terrorism in the Transport Sector – Economic Costs and Benefits
The prospect of reducing threats through technology-intensive customs inspections can be
viewed as an investment in greater trade efficiency. Automated technology—such as bar
codes, wireless communications, radio frequency ID tags, tamper-proof seals for containers
with global positioning technology and other electronic measures—could accelerate global
trade while improving security (Reddy, 2002 cited in World Bank, 2003).
•
Advance passenger and goods information systems and other electronic
identification techniques at ports will speed up passenger and goods movements
(over time lowering business costs) and provide increased security at the border.
•
By simplifying the detection of high risk consignments the advance electronic
transmission of customs data before the goods are shipped will facilitate trade
(WCO, 2003).
Standardising the electronic manifests system at all ports will save time and reduce costs
through quicker processing of cargo, faster vessel turnaround, a more consistent approach
to cargo and vessel data reporting, increased confidence in the reporting system and more
timely responses for importers and exporters. All these benefits will lower freight and
handling costs, reducing final prices of traded goods and increasing demand.
Introducing compatible electronic systems to handle trade also will reduce business costs.
For example, after introducing an electronic supply chain and logistics system, a US
manufacturer with an annual turnover of US$1.2 billion and imports of US$100 million now
takes only 20 minutes with half as many people to produce a manifest that formerly took two
to three days to prepare (Chabrow, 2003).
•
USCS’ cost-benefit analysis of a new electronic customs manifest handling system it
was proposing before September 11 indicated direct savings to US importers alone
of US$22.2 billion over 20 years and savings to the US government of US$4.4 billion
over the same period (OECD, 2003).
The USCS’ ACE project is expected to increase security by enabling the USCS more readily to
identify and intercept high risk cargo, while at the same time reducing costs to business and
facilitating the faster processing of goods.
According to recent research, automated customs can lower direct costs of customs clearance
by the equivalent of 0.2 per cent of the value of traded goods. By accounting for the indirect
benefits of reduced delays, costs are reduced by 1 per cent of merchandise trade value
(Hertel, Walmsley, and Ikatura 2001, cited in World Bank, 2003).
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One study (Wilson, Mann, and Otsuki, 2003) estimated the potential increase in trade following
improvements in trade facilitation areas (ports efficiency, customs environment, regulatory
environment and service-sector infrastructure as proxied by the use of e-commerce in
businesses). The authors examine a scenario in which trade facilitation capacity in below-
average countries is raised halfway to the average of the entire set of countries. Their findings
suggest that better trade facilitation would increase trade among the 75 countries by
9.7 per cent (or approximately US$377 billion dollars) (Chart 5.3). Improved customs regimes
would increase trade by 0.8 per cent (or US$33 billion dollars), more efficient ports would
increase trade by 2.8 per cent (or US$107 billion), while improved regulatory environment
would increase trade by 2.1 per cent (or US$83 billion). Enhanced use of e-commerce in
businesses would increase trade the most, by almost 4 per cent (or US$154 billion dollars).
This latter result is consistent with the estimated benefits arising from the adoption of paperless
trading among APEC economies, noted earlier. The APEC 2001 report suggested that paperless
trading could reduce landed costs of goods traded between APEC economies by 3 per cent
each year or an annual savings of around US$60 billion.
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Combating Terrorism in the Transport Sector – Economic Costs and Benefits
CHART 5.3
Counter-terrorism measures can bring about trade facilitation benefits
Trade gains (exports plus imports) from raising handling capacity in 75 below-average
countries halfway to global average
Source:
Wilson, J.S., Mann, C.L., and Otsuki T., 2003 cited in World Bank, 2003.
Notes:
The study included 75 countries including 52 developing countries. The indicators in the analysis are:
• port efficiency (through measurements of port infrastructure)
• customs environment (incl. non tariff fees)
• regulatory environment (incl. transparency of government policy and control on corruption)
• use of e-commerce by businesses, a proxy for service sector infrastructure necessary to implement
e-business.
5.3 Implications
While it is impossible to remove completely the risk of terrorist attacks, security measures in
the transport sector designed to stop terrorism can add certainty and stability to the global [ Pobierz całość w formacie PDF ]