MANILA - The World Bank said Wednesday it approved an $88.28 million (P1.3 billion) loan to support the modernization and reforms at the Bureau of Customs.
The Philippines Customs Modernization Project aims to improve customs administration, reduce transaction costs and enhance predictability and transparency of the clearance process at its borders, the World Bank said in a statement.
Streamlining, automation of procedures and supporting the development of "world-class" customs processing system (CPS) of the Bureau of Customs are part of the project, it said.
Under a modern CPS, trade managements and registration, cargo inspection, duty payment and clearance and release, among others, will be integrated in a seamless online system.
Adherence to international standards for customs processing such as audit trail for transactions will also be improved for "greater transparency and less opportunity for corruption," the World Bank said.
“Improved efficiency at the Bureau of Customs will reduce trade costs and support Philippines’ competitiveness. Automation will reduce face-to-face interactions and delays, and increase accountability, all of which strengthens efficiency and improve the business environment,” World Bank Country Director for Brunei, Malaysia, Thailand, and the Philippines Ndiamé Diop said.
The World Bank said the Philippines' growth potential, prior to the COVID-19 pandemic, was constrained by inefficiencies in trade facilitation and customs administration.
On an average, it takes a container in the Philippines 120 hours to clear customs and related procedures, far from Vietnam's 56 hours, Thailand's 50 hours and Malaysia's 36 hours, the bank said.
This resulted in firms foregoing expansion in the country, it said.
Poor trade facilitation can also be attributed to outdated infrastructure and business practices, the World Bank said.
Traders, exporters, importers, port operators, shipping companies, transport providers and many small and medium enterprises are expected to "directly benefit" from the modernization of the Bureau of Customs, it said.