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Following is the full text of a speech (English only) by the Secretary for Commerce and Industry, Mr CHAU Tak Hay, at the 9th WCO (World Customs Organization) Regional Conference of Head of Administrations for the Asia Pacific Region today (April 9):

Ladies and Gentlemen,

I would like to extend a warm welcome to all of you for coming to Hong Kong to attend this important conference. It is a great honour and privilege for Hong Kong, China to host this event in our capacity as the Vice Chairman of the World Customs Organization for the Asia Pacific Region.

The World Customs Organization, or "WCO", is dedicated to the improvement of efficiency and effectiveness of customs administrations through cooperation. To this end, it has developed for its members international conventions, devised benchmark operational practices, and offered technical assistance and training. In its nearly 50 years of existence, the WCO's achievements are remarkable.

The work of customs has become increasingly challenging nowadays. The demands for its role as a frontier guard against the smuggling of contraband and as a facilitator for speedy movement of legitimate trade and passengers are growing simultaneously. This dual role requires customs officers to strike a delicate balance between the two. This is not an easy task, particularly after the tragic event of September 11 which has called upon customs to take on a heavier responsibility as a frontier guard.

As Secretary for Commerce and Industry of the Government of the Hong Kong Special Administrative Region, I am naturally interested in the impact of trade liberalisation and globalisation on the operation of customs. In the past century, we have witnessed the tremendous power of trade liberalisation and globalisation. New markets have opened up and international trade has grown enormously. But the impact is not confined to the conduct of trade; it has also changed significantly the environment in which customs operate in the face of the ever increasing grow of cargoes and passengers across borders. We need to come up with creative measures to meet the challenges.

I wish to share some of our experience in this regard. Apart from having the largest container port in the world, Hong Kong has one of the busiest land boundary crossing points with a daily average of 25 000 vehicles going into and coming back from the Mainland of China. With China's accession to the World Trade Organization, cargo flow at our boundary will continue to increase, putting huge pressure on our Customs operation there. To cope with this growing demand, we have been introducing various measures to facilitate cross-boundary traffic. These include installing an automatic vehicle recognition system, introducing one-stop clearance for both immigration and customs, expanding physical infrastructure at the boundary checkpoints and using high-tech equipment for cargo checking.

In essence, there are three areas in which customs authorities should take action to enhance their trade facilitation role. They are simplification and harmonisation of customs procedures, application of information technology, and close cooperation among customs authorities.

Simplification and harmonisation of customs procedures are a continuous process, which must move in time to respond to changes in demand. The revised Kyoto Convention represents the efforts of the WCO to bring life and agility back to the instrument, which provides customs world-wide with a common standard for their operation. The trading community is watching you closely with immense interest to see if the revised Convention can be implemented in the nearest possible future.

But simplification and harmonisation of rules and procedures cannot operate alone without the application of information technology in the daily work of customs. It is only through information technology that we could achieve shorter clearance time with greater accuracy.

In Hong Kong, for example, we developed an "EDI - Manifest" system to enable carriers to submit cargo manifests electronically to Hong Kong Customs. The system is expected to come into operation later this year following completion of the necessary legislative process.

We are also developing an IT-based intelligence system to enhance the risk management process. Using the system, front-line Customs officers will be able to target at those high risk cargoes and passengers for examination, thereby shortening the time needed for clearance. In developing our system, we have borrowed experience from other customs administrations to ensure that ours is up to the world standard.

To keep pace with the development of e-commerce, Hong Kong Customs is also conducting a study to map out a department-wide information system strategy for the next five years.

The third area for action is closer cooperation of customs authorities over the world. A good example is the close cooperation between the Hong Kong Customs and the Customs authorities in the Mainland of China. At present, we are examining a number of initiatives with our Mainland counterparts to speed up the flow of passengers and goods, for example, the introduction of "one-stop" arrangements on a trial basis for trucks crossing at the boundary control point. We fully realise that this is important to the development of our economy, in particular, the logistics industry.

Our liaison with overseas customs authorities is also very active. Hong Kong Customs have concluded a total of 11 Customs Cooperation Arrangements with other customs authorities. As a result, notable achievements have been made through exchange of intelligence or joint operations.

Needless to say, the success of the WCO is the best evidence of cooperation amongst Customs world-wide. As the WCO enters its 50th Anniversary, I take this opportunity to congratulate the WCO on the success of all the good work that it has done in the past.

I wish you all a fruitful discussion over the next few days. To our overseas guests, I also wish you a pleasant stay in Hong Kong.

Thank you.

End/Tuesday, April 9, 2002

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