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Implementation of the Single Window System in Kenya 2015

AAEC MEETING - sOMONE 2015

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Implementation of the Single Window System in Kenya 2015

  1. 1. Implementation of the Single Window System in Kenya Presentation to: African Alliance for Electronic Commerce Meeting- Dakar, Senegal. Venue: Hotel Decameron Date: Monday, February 2nd , 2015
  2. 2. Presentation Outline 1. Background 2. SWS Project in Kenya 3. Project Stakeholders 4. Project Status Tuesday, February 10, 2015 2 4. Project Status 5. Key Achievements 6. Challenges, Success factors & Lessons learnt 7. Recognition 8. Single Window Systems in EAC 9. Areas of cooperation
  3. 3. Background 2005 : Preliminary assessment of a Port Community Based System (PCBS) Project – Conceptualization of the PCBS 2006 : Started Port Based Community System Project Spearheaded by KPA and KRA Steering Committee -MD -KPA & KRA- CG 2007 : Why Kenya National Electronic Single Window System Cross cutting national Project –conceptual approach Include all Government regulatory agencies Give initiative GoK authority Trade facilitation a GoK function Steering Committee elevated to Government /Ministerial level PS Treasury-Chair, PS Transport, PS Trade, KPA.KRA.KEBS 2011 : Kenya Trade Network Agency - KENTRADE
  4. 4. Background – Cont’d A State Corporation established in January 2010 vide Legal Notice No 6 of 2011. Principal Objectives: To Facilitate International TradeTo Facilitate International Trade To implement, operationalize and manage the Kenya Electronic Single Window System (Kenya Tradenet). Parent Ministry: National Treasury
  5. 5. Background: Why Single Window? Trade procedures in Kenya have been inefficient, lengthy and slow resulting in high cost of trade transactions/doing business. The main reasons are as follows: Many stakeholders involved in cargo clearance process. Stakeholders exchange many documents among themselves. Stakeholder ends up sending the same document to eachStakeholder ends up sending the same document to each other many times. Exchanges are in hard copy form and in most cases, processing of information is carried out manually. Perennial congestion at the port, long truck queues at the border posts, corruption, Underutilization of port facilities, and ultimately, loss of competitiveness for the country.
  6. 6. Kenya’s Ease of Doing Business Ranking Ease of Doing Business in Population 44,353,691 GNI Per Capita (US$) 930 Doing Business 2015 Rank Doing Business 2014 Rank*** Change in Rank 136 137 1 Topics DB 2015 Rank DB 2014 Rank Change in Rank Starting a Business 143 134 -9 Tuesday, February 10, 2015 6 Starting a Business 143 134 -9 Dealing with Construction Permits 95 35 -60 Getting Electricity 151 151 No change Getting Credit 116 111 -5 Protecting Minority Investors 122 118 -4 Paying Taxes 102 146 44 Trading Across Borders 153 152 -1 Enforcing Contracts 137 137 No change
  7. 7. Inefficient processes addressed by the Kenya Electronic Single Window System KRA PCPB KPA PPB Other related government agencies NBA KEBS Many government regulatory agencies Chamber of Commerce TBK Carriers Importer/Buyer Exporter/Seller Freight Forwarder /Shipping Insurance Company Numerous lodgments Many Duplicated data elements ACA
  8. 8. Results of Inefficiencies Tons of trade documentsCongestion at Borders & Port Impossible d'afficher l'image. Votre ordinateur manque peut-être de mémoire pour ouvrir l'image ou l'image est endommagée. Redémarrez l'ordinateur, puis ouvrez à nouveau le fichier. Si le x rouge est toujours affiché, vous devrez peut-être supprimer l'image avant de la réinsérer. Impossible d'afficher l'image. Votre ordinateur manque peut-être de mémoire pour ouvrir l'image ou l'image est endommagée. Redémarrez l'ordinateur, puis ouvrez à nouveau le fichier. Si le x rouge est toujours affiché, vous devrez peut-être supprimer l'image avant de la réinsérer. Human Intervention leading to corruption
  9. 9. The Solution -Single Window System UN CEFACT RECOMMENDATION 33; A facility that allows parties involved in trade and transport to lodge standardized information and documents with a single entry point to fulfill all import, export, and transit-related regulatory requirements. Trader or Agent submits allTrader or Agent submits all information required for clearance once to the Single Window System Responses from various Authorities and Financial Institutions are returned to Trader or Agent Kenya Revenue Authority Kenya Ports Authority Other Control Agencies Banks
  10. 10. Bali Package & Single Window Systems The Bali Package - a trade agreement resulting from the 9th Ministerial Conference of the World Trade Organization held in Bali, Indonesia from 3rd to 7th December 2013. Single Window Systems relevant to implementation of 8 of the 13 articles of the Trade Facilitation Agreement.13 articles of the Trade Facilitation Agreement. Article 7: Release and Clearance of Goods Article 10: Formalities connected with Importation and Exportation and Transit most significant. Article 10 specifically encourages member states to establish and maintain Single Window Systems.
  11. 11. Benefits to Government 1. Enhanced Revenue yields 7. Enforcement of controls laid down by domestic policies and International agreements 2. Improved trader Compliance 8. Improved international competitiveness of Kenya Tuesday, February 10, 2015 11 3. Enable use of sophisticated “Risk Management” techniques for control and enforcement purposes 9. Facilitate economic growth – Vision 2030 4. More effective and efficient deployment of resources 10. Improved Infrastructure utilization at ports 5. Availability of Trade Statistics 11. Enhance Transparency 6. Enhance e-Government G2B, G2G
  12. 12. Benefits to Business 1. Simplified trade information exchange 2. Faster trade documentation processing - electronic 3. Reduced errors with minimized data re-entry Tuesday, February 10, 2015 12 3. Reduced errors with minimized data re-entry 4. Improved efficiency & transparency – eliminates manual processes 5. Lower business costs e.g. port storage charges 6. Security in supply chain process -traceability
  13. 13. Benefits to the Kenyan Economy 1. Based on the volume of goods imported/exported:- •First 3 years – US$ 150m and US$ 250m per annum •Thereafter - US$ 300m to US$ 450m per annum 2. Arising from improved services e.g. •Reduced trade transaction costs Tuesday, February 10, 2015 13 •Reduced trade transaction costs •Reduced delays •Reduced Inefficiencies •Reduced corruption •Reduced manual documents/paperwork •Reduced cost of capital ( JIT Concept) •Reduced demurrage •Improved space utilization at ports/Airports-Increased capacity utilization
  14. 14. Average Cargo Dwell Time GovernmentEnterprises Current Single Window Objective 7 days maximum - 3 days7 days maximum - 3 days 5 days 2 days maximum - 1 day maximum - 1 hr.
  15. 15. Project Stakeholders
  16. 16. Project Stakeholders (27)Project Stakeholders 1. Kenya Revenue Authority 7. Horticultural Crop Development Authority 2. Kenya Ports Authority 8. Directorate of Veterinary Services 3. Kenya Bureau of Standards 9. Kenya Sugar Board 4. Kenya Plant Inspectorate Service 10. Kenya Dairy Board 5. Pharmacy & Poisons Board 11. Radiation Protection Board 6. Port Health 12. Pest Control Produce Board
  17. 17. Project Stakeholders (27)Project Stakeholders – Cont’d 13. Directorate of Mining 19. Anti-Counterfeit Agency 14. Kenya Wildlife Services 20. Kenya National Police Service 15. Central Bank of Kenya 21. Kenya National Chamber of Commerce & IndustryCommerce & Industry 16. National Biosafety Authority 22. Ethics and Anti-Corruption Authority 17. Agriculture, Fisheries and Food Authority - Tea Directorate 23. National Environment Management Authority 18. Nursing Council of Kenya 24. Kenya Maritime Authority
  18. 18. Project Stakeholders (27)Project Stakeholders – Cont’d 25. Office of Intermodal Freight Management) of the DR Congo (OGEFREM) 31. Kenya Bankers Association 26. Kenya Medical Laboratory Technicians and Technologists Board 32. Association of Kenya Insurers 27. The National Treasury 33. Kenya Ship Agents Association 28. Kenya Association of Manufacturers 34. Container Freight Stations Association of Kenya 29. Kenya International Freight & Warehousing Association 35. Kenya Groupage Cargo Handling Association 30. East African Shippers Council
  19. 19. Project Status
  20. 20. Project Status • October 31, 2013 – Kenya TradeNet System go live • May 2, 2014 – Official launch of the System. • 3 Project Phases Phases 1A – Pre-clearance Documentation Modules Phase 1B – Declaration Submission Module Phase 2 – Permits Module Phase 3 – Permits Module Implementation of 16 Modules & functionalities completed. Implementation of 4 Modules & functionalities ongoing.
  21. 21. Launch of the Kenya TradeNet System - May 2, 2014
  22. 22. Implementation Status: Completed Modules Module/ Functionality Date Gone Live 1. Unique Consignment Reference (UCR) Oct 31, 2013 2 Impending Arrival Report (IAR) Dec 02, 2013 3 Bay Plan (BAPLIE) submission Mar 28, 20143 Bay Plan (BAPLIE) submission Mar 28, 2014 4 Manifest Sea Mar 28, 2014 5 Manifest Air Apr 15, 2014 6 Permits Mar 28, 2014 7 Import Declaration Form (IDF) Mar 28, 2014
  23. 23. Implementation Status: Completed Modules 8. Payments Oct 31, 2013 9. Availability of attachments Oct 31, 2013 10. Cargo Release Nov 21, 2013 11. Reports Nov 15, 2013 12 User Admin Oct 31, 2013 13 Integration with Kenya Revenue Authority systems Oct 31, 2013 14 Integration with Kenya Ports Authority Systems Oct 31, 2013 15 Integration with KEPHIS System Oct 31, 2013 16 Dynamic Risk Management Sept 31, 2014
  24. 24. Implementation Status: Ongoing Modules A. Pending Modules/ Functionalities Completion Date 1. Security Bonds February 28, 2015 2. Declaration Submission February 28, 2015 3. Exemptions Module February 28, 2015 4. Outbound Processes February 28, 2015 B. Other Ongoing Activities Completion Date 1. Permits - Phase 3 Training of End Users ( C & F Agents, PGAs) January 31, 2015 2. Declaration Module Training of End Users ( C & F Agents February 28, 2015 3. Piloting of Declaration Module February 28, 2015 4. Outbound Processes February 28, 2015
  25. 25. Key Achievements
  26. 26. Key Achievements Unique Consignment Reference (UCR) Module - new concept in Kenya. Electronic application of permits by the traders on 24 hours basis. Electronic processing and approval of permits by the PGAs. Electronic confirmation of Payments and provision of multiple payments instruments. Ksh 124,875,700.00 (USD 1,387,508) has been collected byinstruments. Ksh 124,875,700.00 (USD 1,387,508) has been collected by government agencies through the SWS Payment Gateway. Integrated Risk Management System accessible by a number of the Partner Government Agencies. Full Integration with 3 major stakeholder systems (KRA, KPA, KEPHIS). Ongoing integration work with other Agencies. Real-time generation of reports Compliance levels have gone up e.g. traders have to provide permits
  27. 27. Implementation Challenges, Success Factors & Lessons learnedFactors & Lessons learned
  28. 28. Implementation challenges 1. Resistance to change 7. Inadequate legislation 2. Scope Creep 8. Inadequate funding 3. Payments System Challenges 9. Data Harmonisation challenges Tuesday, February 10, 2015 28 4. Low ICT maturity of some PGAs 10. National Telecommunication Infrastructure limitations 5. Slow roll out due to lethargy by some PGAs 11. Uncoordinated system developments among PGAs. 6. Large number of PGAs involved (24) 12. Slow resolution of issues by PGAs during piloting.
  29. 29. Key Success Factors 1. Strong political goodwill and Government support 5. A strong business case 2. Development partners’ support 6. Sustained stakeholder Tuesday, February 10, 2015 29 2. Development partners’ support 6. Sustained stakeholder engagement 3. Clear requirements specification 7. Diverse & Competent Project Implementation Team 4. Competent Project Implementation Partner 8. A Practical Project Plan.
  30. 30. Lessons learnt 1. Need for formalization of inter - organizational collaboration. 5. Continuous BPR to ensure optimal performance and improvement of processes. 2. Need for continuous engagement 6. Continuous knowledge transfer Tuesday, February 10, 2015 30 2. Need for continuous engagement with stakeholders (Internal & External ) e.g sensitization forums & trainings. 6. Continuous knowledge transfer through trainings , workshops , conferences. 3. Increased collaboration with relevant international bodies. 7. Competent project team. 4. Development of trade policy and legislation that governs implementation of SW concept.
  31. 31. RecognitionRecognition Tuesday, February 10, 2015 31
  32. 32. CIO100 Awards 2014: Best Public Sector ICT Project
  33. 33. Single Window Systems in the EAC RegionSingle Window Systems in the EAC Region 33
  34. 34. NSW GW NSW Centralized Gateway ModelDistributed Gateway Model => ASW Regional Single Window Models NSW NS W Regional Service GW GW GW GW GW NSW Central GW NS W NSWNSW RSW
  35. 35. EAC National Single Window Systems Implementation Status Country Single Window Implementation status Remarks Kenya Yes Implementation to be completed in April 2015. Uganda No Funding obtained through TMEA & Implementation set to commence in October 2014. 35 set to commence in October 2014. Tanzania No Talks ongoing with TMEA to fund implementation. Rwanda Yes, partially Stakeholders integrated are Rwanda Revenue Authority, Rwanda Bureau of Standards, Rwanda Development Board, Ministry of Health, Airlines & Clearing Agents. Ethiopia No Project Implementation Team formed & Study Visits ongoing (KENTRADE Visited). South Sudan No No known plans yet. Burundi No Talks ongoing with TMEA to fund implementation.
  36. 36. Towards a Regional SWS Under the leadership of the EAC Secretariat, develop and implement a cooperation framework. Assist the EAC region collectively by funding the EAC Regional Single Window System implementation Project.Single Window System implementation Project. 36
  37. 37. Areas of CooperationAreas of Cooperation Tuesday, February 10, 2015 37
  38. 38. Areas of cooperation Proposals for Funding Area Description Estimated costs (USD) Set up of Secondary site Setup of secondary site to ensure high availability. Cost to cover servers, supporting software, storage, and network 6,000,000 Tuesday, February 10, 2015 38 storage, and network infrastructure. Automation of partner government agencies In order to improve efficiency in the end to end process, it will be necessary to support the automation of back end approval processes and integrate the systems with the KNESWS. USD 200,000 per stakeholder. 2,000,000
  39. 39. Proposals for Funding Area Description Estimated costs (USD) Implementation of the KENTRADE Business Model The Kentrade business model has been developed with support of TMEA. The same needs to be implemented 700,000 Areas of cooperation – Cont’d Tuesday, February 10, 2015 39 implemented Set up of Facilitation Centres at key border stations. Set up and out- source the facilitation centres to the youth for management Set up of each estimated at USD 50,000. Costs include • Computers • Furniture • LAN/Electricals • Rent for 1 year 250,000
  40. 40. KENTRADE Contact Centre
  41. 41. Questions Thank You

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