The government has reported that pilots for a digital, risk-based approach to conducting border controls have yielded “higher quality data” that could reduce the time needed to make decisions on goods entering Britain by 17%.
It yesterday (29 August) published an evaluation report of the six ‘Ecosystem of Trust’ pilots that different consortia have been running for goods entering Britain from various locations. The Institute of Export & International Trade (IOE&IT) was involved in two of these pilots.
The initiative sought to explore the government’s vision – set out in the 2025 Border Strategy – of “using data and technology to create the most effective border in the world”.
The government concluded that there is appetite, in all quarters, to use higher quality data to “unlock solutions” that improve the efficiency of checks conducted on goods entering Britain.
Better data
The assessment report found that the use of the various supply chain technologies explored in each of the pilots yielded “higher quality data” than what is currently available to government, potentially allowing border agencies to decrease the time needed to make decisions on goods crossing the border by 17%.
The data provided by the consortia provided “80% of the minimum risking requirements for customs purposes and 60% of trade statistics requirements”.
Reducing burden
If scaled up, the Ecosystem of Trust model could allow for government to reduce administrative requirements around customs procedures for businesses; it cited the possibility of “automation of customs declarations using business documentation” as an example of how it would do this.
This automation could lower customs data collection costs by 40%, resulting in up to £225m in annual savings, the report states.
The government also said that DEFRA’s forthcoming ‘Trusted Trader’ schemes, which are being introduced as part of the Border Target Operating Model, will apply some of the ideas explored in the pilots.
Interoperability challenge
However, the report also concluded that the new model is “not yet ready to replace traditional mechanisms of border control” because “industry has yet to be incentivised to develop the appropriate technical infrastructure” to scale up the ideas explored in the pilots.
The government said that “no new model will be taken up by industry if it isn’t attractive” and that “interoperability is the biggest problem to solve”.
It said that the removal of legal barriers to the digitisation of trade documentation through the Electronic Trade Documents Act – which comes into force on 20 September – could help solve the interoperability puzzle.
Other challenges
The report also states that the “adoption of digital trade document standards” needs to be encouraged and that the UK Single Trade Window, which is currently in development, would need to provide a “way for the government to ingest supply chain data”.
Government has also not yet “adequately determined” how best to make the most of the enhanced data the model would provide.
Promising, but work to be done
IOE&IT director of strategic projects and international development, Kevin Shakespeare, welcomed the report, saying the Ecosystem of Trust model has been largely validated.
“This report is a key moment for UK trade in that the government has concluded that the use of cutting-edge supply chain technologies, such as those trialled in the six pilots, leads to better data and enables government to be more efficient in how it conducts checks.
“This is positive news for businesses because this will allow government to explore ways of reducing administrative burden around cross-border trade.
“The government is right to say that more needs to be done to prepare and incentivise industry for a more digital approach to trade by developing the infrastructure and standards needed for this pilots to be scaled up.
“The IOE&IT will continue to work with both government and industry to ensure this is done, as the potential benefits to UK trade – and therefore the UK economy – are really significant.”
Advocate
As well as being a leading member of two of the consortia running the Ecosystem of Trust pilots, IOE&IT has been a leading advocate for the opportunities of trade digitalisation, with its director general Marco Forgione regularly speaking to the media about it.
“Anything which reduces delay – which reduces the need for oversight intervention, and speeds the transfer of documents required for the goods to move – is a positive,” he recently told Tech Monitor.
TLIP
As part of one of the Ecosystem of Trust pilots, IOE&IT implemented the technology it developed alongside TradeMark Africa for the Trade Logistics Information Pipeline (TLIP) project, which established a digital trade corridor between the UK and Kenya.
Commenting on this project, Forgione told the Times: “You’ve got security and visibility of all the trade documentations by all the actors, which means that finance costs, insurance costs and logistics costs all reduce because they’re de-risked. You no longer have the need to stop shipments at the border. You can do a review or an audit in-market. It means that trade is simplified, speeded up.”