CIPE’s Senior Program Officer Florent Bakija explains how Customs clearing is being transformed in Malawi.
Customs clearing agents play a crucial role in cross-border trade. Agents assist companies and individuals in meeting export and import requirements, including classification, valuation, and determination of applicability of rules of origin for goods and services. Their job extends to compiling the necessary documents for obtaining final clearance for imported goods, such as certificates of origin and sanitary and phytosanitary certificates. Conformity is vital: errors ramp up delays and costs, discouraging trade and driving up prices for consumers.
In Malawi, the Alliance is modernising an unreliable, informal system that has impeded trade in this landlocked developing country.
Customs officials and traders have long complained about the uncertainty created by inconsistencies in technical expertise, unreliable levels of service, and the weak institutional relationships between the public and private sector. This environment has discouraged business – particularly smaller companies lacking the resources to negotiate opaque processes – and cost the country significant sums in lost customs duties through tax evasion.[i]
This is all about to change. The Alliance is supporting Malawi in introducing national licensing standards in line with international best practices, addressing the lack of formal training for Malawi’s 197 licensed customs clearing agents.
A two-pronged approach to reform first involves mandating certain standards for licensed clearing agents, including a requirement to have at least one Certified Customs Clearing Specialist (CCCS) in every licensed brokerage. The reforms will also cover scope of practice, performance obligations, responsible supervision, and eligibility criteria for licensed brokers.
The second, practical strand, emphasizes training and certification. To become a licensed clearing agent, applicants will have to complete a 4-week online course and pass a formal examination. The online training comprises seven modules, covering topics ranging from the harmonized tariff system and import and export clearance procedures, to fundamental ethics principles and the importance of customer care.
This key component of the supply chain also places special emphasis on the recruiting and training of women customs clearing agents to address the gender gap in the status quo.
Participants are expected to spend an estimated 148 hours of training before sitting for the examination. The first batch of 100 participants is expected to graduate in early summer 2023, signalling a sea change in the conduct of trade in Malawi and serving as a model for other countries in sub-Saharan Africa. Neighbouring Zambia is also undertaking an identical program and other countries, such as Tanzania, have expressed an interest.
Working through public-private partnership to make trade more transparent, inclusive, and reliable, this targeted Alliance project supports the implementation of the WTO’s Trade Facilitation Agreement and brings significant transformational value to Malawi’s economy and government.
If you are interested in finding out how we can modernize trade processes in your country, please email email@example.com.
Florent Bakija, Senior Program Officer, Center for International Private Enterprise
[i] Frank Kalizinje, ‘Combating Customs Revenue Fraud in WCO East and Southern African Region: A Mirror Analysis Through the Lens of Malawi’, (2018), 13, Global Trade and Customs Journal, Issue 5, pp. 224-233