EghtesadOnline: The use of up-to-date software and hardware technologies has dramatically helped the Islamic Republic of Iran Customs Administration revolutionize the processes and services involved in trade, leading to efficient performance and ease of trade.
Financial Tribune interviewed Director general of IRICA’s ICT Office Firouzeh Khiali at the 23rd Iran International Exhibition of Electronic, Computer and E-Commerce, also known as Elecomp 2017, about the impact of information technology on IRICA’s procedures.
Organized by the Iranian ICT Guild Organization, Elecomp is the biggest commercial event in Iran’s electronics, computer products and services market. Elecomp 2017 opened at Tehran’s International Permanent Fairgrounds on Friday and will run through Monday.
Starting Point and Impact
According to Khiali, the use of information technology by IRICA date back to the fiscal 2014-15, following the implementation of new strategies aimed at digitizing trade devised by Masoud Karbasian, IRICA’s director general.
She noted that with this aim in mind, shortcomings in the traditional system were identified and a new framework was devised.
Based on the new framework, mechanization was incorporated at two levels. At the intra-organizational level, all processes and services of goods clearance were planned to be performed electronically, and at the inter-organizational level, a system called “single-window system” was implemented. The system takes care of all services and interactions for beneficiaries electronically and cuts paperwork.
The new system runs 24/7, increasing both speed and accuracy, which was not possible in the old system.
The official explained that before the implementation of this system, documents had to be obtained by individuals from IRICA and then handed in to other relevant organizations for further actions, which took a very long time. Moreover, the traditional system was prone to forgery.
“Now everything is done safely without the slightest possibility of misuse,” she said.
IRICA has also lunched the Pre-Arrival Value Declaration of imported items, based on which traders supply customs officials with information about goods before they are brought into the country, enabling authorities to calculate the value and set the import tariffs in advance based on factors such as the source country, type of cargo, currency, etc. This speeds up the process of clearance hugely and eases trade.
“These examples indicate that IRICA has taken advantage of software and hardware technologies to its benefit and we have come to an understanding that we can use information technology to improve trade,” she added.
Changes in the system implemented by IRICA have led to huge improvements in Iran’s performance on a global scale in that the World Bank ranked the country 96th among 160 nations in Logistics Performance Index in 2016, which indicates an improvement of 23 steps.
LPI is an interactive benchmarking tool to help countries identify the challenges and opportunities they face in undertaking trade logistics and what they can do to improve their performance.
Impact on Smuggling
The director general said prior to the implementation of such technologies, it was not possible to track goods but now goods are tracked easily. In addition, the data in the system can also be used by the police to stop illegal imports.
“Illegal imports were estimated at around $25 billion in the fiscal 2013-14, prior to the implementation of information technology in IRICA, but the figure dropped to $12 billion last year (March 2016-17),” she said.
Khiali added that one of the most important reasons behind this drop is IRICA’s implementation of software and hardware technologies.
“Technology has helped us gain complete control over foreign trade and logistics,” she said.
Rise in Revenues
One of the other benefits of using information technology for IRICA is the increase in customs revenues, she said.
IRICA earned an all-time high of 180 trillion rials ($4.7 billion) in revenue from imports last year, despite the decline in volume. The value of total imports stood at $43 billion. In the fiscal years 2012-13 and 2013-14, imports stood around $60 billion while IRICA earned 70 trillion rials ($1.8 billion).
Khiali stressed that all the technologies were devised and implemented by Iranian experts.