connecting to global supply chains 1. what can governments do to connect producers to global supply...
TRANSCRIPT
Connecting to Global Supply Chains
1
What can governments do to connect producers to global
supply chains (SCs)?
Aid for Trade for SPECA10-11 July 2013
Geneva
Maria Teresa PisaniGlobal Trade Solutions Section
Trade Division - UNECE
2
Trade facilitation and the international political agenda
3
- 1 day to export/impo
rt
…..+ 4% international
trade
- 4 days to export/impo
rt
….+ 0.1 % GDP per capita
growth rate
&
Source: WTO 2012, OECD 2012, WB DB Report 2013
Economic growth through exports is a key strategy for developing and transition economies
Trade facilitation is an essential component of such strategy
…What are the trends?
4
From tariff barriers to non-tariff barriers
Emergence of global value chains
Need for more efficient, simple and transparent trade transactions and information exchange
kenyaNigeriaRussia
TanzaniaMexicoChinaBrazil
MalaysiaCzech Republic
PolandHungary
JapanSpain
South KoreaUSA
CanadaUK
Netherlands
$- $4.00 $8.00 $12.00
Source: Analysis of OECD Minimum Wage Data
Minimum Wage Cost (hour)
Export growth driving factors in DCs
UNECE’s Work on SCs and Information Exchange
6
Policy Rec.s
Standards
Guidelines, Briefs,
Studies
Capacity B
uilding and Technical A
ssistance
UNECE Study on international SCs: Objectives
7
Present a model of regulatory, procedural and business processes, and requirements for information flow
Identify the specific opportunities that better information sharing in global supply chains can bring
Elaborate a roadmap for prerequisites and actions that government and businesses should put in place
From National to International SCs
Customs
Customs
Buyer
Shipper
Port
Seller
Port
Haulage
Haulage
National Supply Chain
Customs
Customs
Buyer
Haulage
Seller
Seller
Buyer
Haulage
Haulage
Inter-regional Supply Chain
Shipper
Port
Port
Intra-regional Supply Chain
Go
od
s
Info
rmati
on
Cas
h
The step change in the
number of stakeholders +increase in administration
requires standardisation and increased integration for easier participation of SMES
9
The complexity of the International SCs: Layers
.
Actors and Processes in the International SC: Export Phase
3) Pay
Pay
Customer’s Bank
Supplier’s Bank
1) Buy
Buy
SupplierCustomer
2) Transport
2.1 Prepare Export Documents
2.2 Arrange Inspection
2.3 Obtain Cargo Insurance
2.4 Provide Customs Declaration
Inspections Agent
Insurance Agent
Customs
Transporter Domestic
Transporter Cross-Border
2.5 Transport to Terminal
2.6 Clear Cargo Through Customs
2.7 Handle Container at Terminal
2.8 Prepare Documents Required by Customer
Terminal Authority
Security Agency
Contract
Purchase Order
Packing List
Goods Receipt
Letter of Credit
Commercial Invoice
Bill of Lading
Insurance Certificate
Certificate of Origin
Certificate of Inspection
Export Declaration
Import Declaration
The complexity of the international SC: Documents
Data Elements Operational Commercial Control RegulatorySupplier Identification P P P PBuyer Identification P P P PCarrier Identification P P P PPort of Departure P P P PPort of Arrival P P P PProduct List P P P PProduct Classification Information
P P P P
Package List P P P PContainer List P P P PPricing Information P P PValue P P PInsurance Information P PCountry of Origin P P P PCountry of Manufacture P P P PQuality Information P P P PInspection Information P P P PFinancing Information (Letter of credit)
P P P
Export License Information P P P PImport License Information P P P PProof of Delivery P P PSales Contract P PFreight Contract P PTerms (Sale, Payment, Delivery)
P P
The complexity of the international SC: Data
The Current Model: Documents and Data Exchange
Security
Customer
BankCustoms
House Agent
InspectionAgency
InsuranceCompany
LogisticsServiceAgent
OtherSupervisingAuthorities
Transporter
TerminalOperator
Customs
Supplier
ShippingLine /Agent
51034
131250
71147
3610
21012
51139
41033
31025
51139
131249
61041
51139
122
Number of documents exchanged by a given stakeholder
Number of stakeholders interacting with a certain stakeholder
Number of interactions of a given stakeholder with all other stakeholders for all documents
Economic imperatives drive key trends in International SC…
Trends in International Supply ChainOrganization of Production Spatial Organization Patterns of Product FlowPostponement Spatial Concentration of
ProductionNomination of Day and Time of Deliveries
Vertical Disintegration of Production
Spatial Concentration of Inventory
Direct Deliveries
Application of Time Compression Principles
Wider Geographical Sourcing and Distribution
Reverse Logistics
Rationalization of Supply Base
Development of Break Bulk / Transshipment CapabilitiesDevelopment of Hub-satellite systemsConcentration of International Trade on Hub Ports and Airports
Internet enabled applications allow greater data sharing and collaboration
Towards a collaborative SC model…
Importance of behaviour Importance of the commercial model
16
Future ApplicationsExisting Emerging Future
Internal
ERP Web Enabled Shared Applications
Contract Management Web Enabled Shared Applications
Document Management Web Enabled Shared ApplicationsData ExchangePoint to Point EDI EDI + Web Enabled Peer to Peer
Data Exchange Communal
Standards DatabaseSingle WindowPort Community System
Data Exchange Collaborative
Stakeholder PortalsCloud Computing
Shared Applications Contract Management Document Management Event Management
Functional
Barcode Barcode (3D)RFIDSensor TechnologyGPS TechnologyGMS Technology
Cargo Scanning
17
The Roadmap
Plan Development Plan Implementation
Info
rmati
on E
xcha
nge
Low
High
Time
Plan Finalisation
Target State of Information
Exchange
Current State of Information
ExchangeWhere Assess Current State
(Where are we?)
What Determine the Vision(What we want to Achieve?)
How Define Actions(How will we achieve it?)
Who Assign Responsibilities(Who will do what?)
When Develop the time plan(When will it be done?)
Maturity Grids
18
Technical Capability Behaviour
Policy and Regulation
s
Commercial
Construct
Maturity Grid: Behaviour
19
Absent Basic Good Advanced Leading Edge
1. Relationship maturity
Transactional Relationship
Contractual RelationshipCompetitive
Strategic relationship based on enlightened self interest
Strategic relationship based on shared interests
Strategic relationship based on maximizing market opportunities
2. Trust No Basis for Trust
Minimal level of trust based on contract enforcement
Trust based on shared economic interests
High level of trust based on shared economic interests
High level of trust based on shared economic interest and understanding of opportunity to extend benefits
3. Transparency No Transparency
Sharing of minimal operational and technical information
Open sharing of planning and capacity information
Joint planning of demand and capacity by key stakeholders. Development of shared plan
Shared Strategic Plan based on shared goals and long term development of shared interests
Maturity Grid: Policies
20
Absent Basic Good Advanced Leading Edge
1. Import Export Processes
Stand alone manual processes Streamlined integrated processes
Streamlined integrated web enabled processes
Streamlined integrated web enabled real time processes
2. Trade Documentation
Stand alone documents for different agencies
Minimize number of documents
Shared documents between related agencies
Single Administrative Document Shared across regulatory agencies within one jurisdiction
Shared Single Administrative Document across trading partners
3. Capacity Building
Stand alone programmes across multiple agencies
Single development agency Stand alone programmes
Single development agency Integrated programmes
Single agency Client Directed Integrated programmes
4. Integration of Regulatory Bodies
Multiple independent regulatory agencies
Minimize number of agencies based on functional areas
Single Regulatory agency operating multiple processes
Single regulatory agency operating integrated processes
Key Findings
21
Inefficiencies associated with fragmentation
The risks of errors, delays and additional costs
The importance of behavioral prerequisites
The impact of the commercial model
Highlights
22
Governments can:
Streamline processes and
procedures
Support advanced logistics
platforms
Support effective
stakeholders engagement
IT solutions can:
Enhance efficiency and effectiveness
of ISCs
Enable collaborative SC models
Facilitate the participation
of SMEs
Agri-food SCs in CIS countries
23
Mixture of small scale and large scale farming
Attractive market for retailers and food processors
Issues of quality and safety, distrust, obsolete business models
...But evidence of spill-over effects through FDI
Thank you!
For more see:www.unece.org
http://www.unece.org/tradewelcome/capacity-building-for-trade-facilitation/
joint-unrcs-approach-to-trade-facilitation.html
Contact: [email protected]@unece.org
24