The ease of conducting trade across the borders is likely to improve as APEC members promote the use and benefits of global data standards for cross-border control and supply chain management.
“Production networks that span multiple economies are prevalent in our region,” said John Larkin, Chair of the Committee on Trade and Investment. “This makes standardized product identification codes and data infrastructure across multiple economies increasingly important for effective and efficient border management and supply chain performance.”
The APEC is looking at how global data standards are already being used and what benefits there are for increasing trade facilitation and efficiency of border control. Today, complex supply chains mean a product is sourced from multiple suppliers and raw materials throughout the region. Global data standards can assist with product traceability. For example, if hazardous lead paint is detected in a shipment of wooden toy products, relevant government agencies can use global data standards to identify the supplier source of the tainted paint and launch a product recall.
“This is accomplished by scanning the bar code on the product or the GTIN number, a global data standard known as the Global Trade Item Number, that contains the product information,” says Kent Krul, US Department of Agriculture, who shared best practices from the United States at the APEC capacity building workshop in Qingdao.
“Ideally, one data element encoded in this bar code unlocks where the raw materials came from, who the suppliers were, and where the product was manufactured,” added Krul.
Aside from assisting with safety or counterfeit products, global data standards can also expedite trade for low-risk goods. For example if the product repeatedly is a low-risk product and has been previously inspected with no issues, it can more easily be fast-tracked and released without inspection based on the detailed data provided.
The Hong Kong Intra-Asia Visibility Pilot between China; Hong Kong, China; and Chinese Taipei is an example of innovative work to begin streamlining data standards for customs management in the APEC region.
“Before a container leaves, Chinese Taipei Customs will inspect it and install a RFID e-seal. The global data standard for product identification is shared with Hong Kong, China customs through uploading to a cloud-based visibility network,” explained Anna Lin, Vice-Chairman, Sub-Committee on Infrastructure Support, Hong Kong Logistics Development Council.
“Before the container even arrives in Hong Kong, China, the product information allows customs officials to ascertain what, where, when and why from data associated with the product, providing better risk profiling,” added Ms Lin.
This same process and sharing of data occurs as the container moves on from Hong Kong, China and crosses the border into China. The pilot shows the benefits resulting from the use of global data standards in assisting cross-border supply chain management and the ability to track products from the source to destination in real time.
“As a next step on the project, a Trade Policy Dialogue in August will focus on policies to promote the adoption of global data standards in economies and how APEC can work toward mutual compatibility of data standards,” said Vega Wong, Assistant Director-General, Trade and Industry Department, Hong Kong, China, co-project overseer of the APEC project, which is funded by Hong Kong, China and New Zealand.
“From these policy recommendations, next steps might be to launch a possible APEC pathfinder project to encourage economies to realize the benefits of global data standards and move towards compatibility across the region,” added Charlotte Kempthorne, Policy Officer, New Zealand Ministry of Foreign Affairs and Trade, also co-project overseer.