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Malaysia:Dagang Net establishes a unique electronic trade facilitation
network to reduce custom documentation |
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2005-1-20
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Thanks to Dagang Net, Malaysia, Singapore and Taiwan are pioneering cross-border electronic trade facilitation – the first to do so globally – eliciting enquiries from not only Asian countries but from western Europe too.
The crux of the problem during the exports or imports lies in the documentation and this is the beauty of Dagang Net is.
Modus operandi is through the Pan Asian eCommerce Alliance (PAA), whose current members are Tradelink of Hong Kong, Trade-Van of Taiwan, CrimsonLogic of Singapore, KTNET of South Korea, CIECC of China, TEDI Club of Japan, Dagang Net of Malaysia, TEDMEV of Macau and CAT Telecom Public Co Ltd of Thailand.
In 2001, Dagang Net joined the PAA (second year of its formation), while the other country representatives also operate value-added networks (VAN).
The first fruits of this alliance are Dagang Net''s VAN-to-VAN links to Singapore''s CrimsonLogic using a dedicated line, and to Taiwan''s Trade-Van over a virtual private network (VPN). Next in the pipeline is Dagang Net''s link with Hong Kong''s Tradelink.
According to Dagang Net Group director (trade facilitation, business development division) Alvin C.K. Mah, the beauty of PAA is that each member works with its own local authority.
CrimsonLogic is also currently working on its link with Trade-Van.
When customs declaration details are entered into the Dagang Net system, the same are picked up by CrimsonLogic and automatically replicated in documents required by the Singapore authorities, eliminating paper work and saving time. But, more important in the process is error free.
Linkages with the US have been explored but due to 9/11, the authorities there are having a rethink over the export –import procedures.“Other member countries are also beginning to do it ... South Korea, Japan,” said Saifol. “They are not sitting still. But I would like to say our links with Singapore and Taiwan signal the beginning of trade automation in the region.”
Similar links with the US, Malaysia''s largest trading partner, are not likely any time soon, however. Following the Sept 11 incident, the US has been taking a re-look at its import-export procedures.
Chief Executive Officer of Dagang Net Group of Companies, Saifol Bahri Shamlan says countires like Bangladesh, Pakistan, Nigeria, Syria, and Myanmar have expressed keen interest and have invited his company to brief them.
He adds with pride that French authorities have also been asking questions on how it works, and on the set-up.
Optimistic Dagang Net hopes to establish a direct link to facilitate the export of Malaysian textiles and garments to the US. Anticipating a huge growth in export of apparels, garments and textiles in Malaysia after the expiry of the Multi Fibre Agreement, the electronic trade facilitation between the two countries will prove to be a boon.
Presently, the electronic trade facility with Singapore and Taiwan for the movement of goods by sea, air and rail only facilitates Customs declarations to the authorities in the respective territories. Other components in the trade and logistics value chain, like certificates of origin, will be gradually included to realise PAA''s aim to facilitate efficient global trade and logistics.
Dagang Net has invested almost two-thirds (RM13mil) of its anticipated RM20mil investment to upgrade and transform the system originally existing at the Port Klang shipping community into a next-generation web-based, one-stop trade/supply chain portal to facilitate the nation''s international trade.
During the third phase another RM7mil will be spent to overhaul the applications system. “Our plan is to complete the entire value chain by 2008. Of course, we require the cooperation and participation of all the players here,” said Saifol. “We like to also encourage our partners in this scheme – Customs, port authorities, other government agencies to come together to work towards realising this.”
On the private sector side alone, the value chain covers exporters and importers; port, inland port and Malaysia-Thailand Landbridge operators; airport ground handlers and freight forwards; forwarding and shipping agents; insurance companies; trade financiers; haulage companies; warehouse operators; and empty depot operators. (Consignments sent by road between Malaysia and Singapore via the Causeway and the Second Link, as well as that between Malaysia and Thailand, do not come under the ambit of Dagang Net.)
On the government side, there are the Customs department; ministries overseeing international trade and industry, and transport; authorities responsible for free trade zones, dangerous goods, certificates of origin; as well as port authorities and the Department of Civil Aviation.
This one-stop concept – called single window sign-in by the World Customs Organisation, and single administration document in Britain – will also require that the regulatory authorities concerned, including in Malaysia, do some reengineering.
Together with single window sign-in, Dagang Net is working on online application and processing of various export permits, called e-Permits, informed Dagang Net Group general manager Yong Voon Choon.
It has gone live with the Federal Agricultural Marketing Authority on the issue of permits related to trade in coffee beans and cabbage, and is working on that for other crops. It is also finalising similar arrangements with the pesticides and timber boards. “Currently, there are 19 permits that the Customs may require,” Yong added.
In addition, users of Dagang Net''s value-added services can opt to pay local Customs duties online via electronic funds transfer (EFT).“With EFT, we have improved the efficiency of the whole cycle of declaration and duty payment,” said Yong. “Previously, you would have to go to your bank to find out the duty cost and to purchase the bank draft, and to many, many other windows.”
Meanwhile, Dagang Net is awaiting for Bank Negara sanction to offer cargo insurance online. Its partner in this effort is believed to be Tahan Insurance, a member of Bursa Malaysia-listed Idaman Unggul Bhd. |
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