AFFA Logistics Services Perspective

Roadmap to liberalization and integration

Presented by Do Xuan Quang Chairman of ASEAN Federation of Forwarders Associations (AFFA)

15/08/2006 2

Agenda

•  An overview of ASEAN and AEC Roadmap 2015 •  Logistics services integration in ASEAN – part of

ASEAN connectivity •  ASEAN - Trade and logistics facilitation •  Issues and Challenges •  AFFA Logistics perspective •  Initiatives to roadmap of liberalization and

integration of logistics services . Role of AFFA. •  Q & A

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An overview of ASEAN

• Population : 600 millions ( 3rd largest market after China and India)

• GPD total : USD 1,200 Billions ( 2% of global GDP)

• Growth rate : 5,6% annum ( highest growth rate of any single industrialized economy)

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ASEAN Economic Community (AEC) Roadmap to liberalization and integration

•  To create an ASEAN single market by 2015 and strengthening ASEAN economic integration through liberalization and facilitation measures in the area of logistics services

•  To support the establishment and enhance the competitiveness and ASEAN production base through the creation of an integrated ASEAN logistics environment

•  To enhance more flow of goods ,service and investment •  Under AEC ,Logistics industry is being one of 12 priority

sector to liberalization and integration in the region.

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Logistics Friendly Consistent Logistics Logistics Unfriendly

(1st) (29th) (38th) (52nd) (53rd) (59th) (101st) (109th) (129th)

Comparing against the WB’s LPI

2010; 200 companies 3.45 (26th) 2011; 603

companies 3.22 (39th)

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Liberalization of Logistics Services in ASEAN in 2014 •  Transport Services •  International Maritime Transport •  International Rail Freight Transport •  International Road Freight Transport •  International Air Freight Transport •  Courier services •  Non Transport Services •  Maritime Cargo handling services •  Storage & warehousing services •  Freight transport agency services •  Freight inspection services •  Packaging services •  Customs clearance

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Liberalization of Logistics Services in ASEAN in 2014

Subject to Law and Regulation:

Year Foreign ownership 2008  49% 2011 51% 2013 70% 2014 100%

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Trade & Logistics Facilitation in ASEAN

•  Trade & Customs Facilitation •  Implement provision in WTO Agreement on Customs Valuation & WCO

Framework •  Promote electronic document / transaction (e-logistics) •  Encourage implementation of 24x7 customs operations in selected border

points •  Development Single Window Approach for customs clearance •  Facilitate cross border information sharing •  Encourage business firm to develop interoperable supply chain

management to link up planning solutions •  Enhance cooperation between customs & business sector •  Implement risk management practices •  Promote technologies used for supply chain integration .

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Trade & Logistics Facilitation in ASEAN •  Logistics Facilitation •  Enhance transparency of regulation for logistics •  Conclude and Implement ASEAN Framework Agreement on

Facilitation of Inter-State Transport •  Implement Framework Agreement of Goods in Transport •  Implement Framework Agreement on Multimodal Transport

Agreement •  Strengthen Intra Regional and international Maritime and Air

Transport •  Improve land transport network infrastructure and services to

achieve interconnectivity •  Enhance private participation in transport logistics

infrastructure & services

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Development of International Logistics Connection •  Trade Logistics Project in the Region •  Road / Rail/ Water / Air Transport Infrastructures •  Cross Border Transport Agreement in Many Logistics Corridors •  Facilitation of border crossing formalities, transport of goods,

exchange of traffic rights, Road standard & signal, institutional framework

•  Single Stop Inspection Initiatives •  Single Window Initiatives •  Reduce Regulatory Constraints •  Network of Business Logistics Partnership with ASEAN members and

Non-ASEAN members to Cope with Growing intra-regional trade and international trade demand

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Issues and challenges

•  Ratification does not mean implementation •  Gap between countries in term of physical transport infrastructure

and transport linkage •  Unready legal environment for trade facilitation •  Lack of readiness for adopting modern technology •  Weakness in finance support system •  HR development and optimization both private and public •  Poor coordination between private and public sector •  Coordination border management

•  Readiness of National single window (NSW) of each member states will not be ready at same time

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Initiatives in roadmap

•  Closer dialogue and linkage private and public sector •  Continuous strengthening of legal framework and implementation of existing

law. •  Expand Capacity of Logistics Service Provider •  Adopt best practices in providing logistics services •  Promote Regional Cooperation of LSP •  Develop / Update database on logistics service provider •  Human Resource Development •  Upgrade skill through joint training & workshop •  Develop national skill certificate system for LSP •  Encourage the establishment of regional center of excellence •  Enhance Multi Modal Transport Infrastructure •  Promote trade terms & practices related to multimodal transport including

INCOTERMS

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Role of AFFA in implementation of AEC roadmap

•  Advisory body for ASEAN Secretariat to enhance and accelerate the roadmap to AEC 2015 among all the member countries

•  Advisory body for capacity building of trade facilitation related among government officials, private sectors ,users, logistics operators to build up successful ASEAN logistics corridors.

•  National freight forwarders and logistics associations are advisory bodies for related governments to update legal framework , regulations, policies ..and to be a national single window (NSW) and be ready to connect with ASEAN single window (ASW) by 2015

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Thank you very much for your attention

Do Xuan Quang Chairman AFFA

Email : quangdx@vector-aviation.com.vn Hand phone : +84-903901551