This project set out to shift documentary/trade clearance cycles to an entirely electronic process for the huge volume of customs transactions being managed by Abu Dhabi Customs. This flagship project is forecast to have a profound impact on governance, financial and process efficiencies both in the UAE and wider GCC.
Photo of Shadi Abdul Hadi Abu Hijleh, Abu Dhabi Commercial Bank and Salem Saeed Al Rumaithi, General Administrations of Customs (Abu Dhabi Customs).
Salem Saeed Al Rumaithi
Executive Director, Technical Affairs Sector
Abu Dhabi General Administration of Customs was established in 1966 and plays an important role in stimulating the national economy. It is also the cornerstone of the commercial traffic in the Emirate of Abu Dhabi.
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Statistics for 2015 show the huge volume and size of customs transactions in Abu Dhabi:
Non-oil international trade of $46bn.
Customs revenue of $692m.
Number of customs declarations: 1.3m.
Weight of goods cleared: 25.6m tons.
Yet, despite the big numbers, many of the processes surrounding customs transactions were manual. For instance, customs officials were required to manually input and archive the data and payments were received as either cash or cheques. The manual nature of the clearance process ultimately resulted in a serious delay in issuing a customs declaration and completing the final clearance, at the expense of money, resources and customer satisfaction.
As part of a wider government initiative to deliver world-class smart services to the country and move forward on the journey of smart transformation, Abu Dhabi Customs embarked on a project to make more efficient clearance cycles by shifting to an entirely electronic process.
To do this Abu Dhabi Customs has developed a highly innovative e-clearance solution which enables clearing agents to input the data and upload required documents through the customs system. A risk engine then analyses the description of the goods and the underlying documents, before classifying these and specifying if inspection is required. Finally, the agent will do the electronic archiving through the customs system and issue the customs declaration.
Once the clearance is completed, payments will be debited automatically from a clearance agent account which will be funded through Abu Dhabi Commercial Bank (ADCB), either to a customs post-paid or pre-paid account. The payment through the bank is available through different channels, many of which are available 24/7.
The bank has full ERP integration (host-to-host) with the customs system and all deposits to customs accounts’ will be mapped directly to the particular clearance agent’s account by auto capturing of the agent code from a barcode. Finally, auto reconciliation happens through customised reports sent by the bank via the connection with the customs system. This amount can then be utilised immediately on a real-time basis.
Furthermore, to ensure that the system is flexible and user-friendly Abu Dhabi Customs developed smart applications for customs inspections through mobile applications. These applications are able to record all data, receipts, inspection results, reporting, suggestions, complaints, and to retrieve any record at any time in a very convenient manner.
Best practice and innovation
In completing this project, not only has the customs department achieved demonstrable savings together with generating revenue of $692m, but processing time has dramatically reduced from hours or days to almost zero for 90% of transactions. As a result, the project has enabled the department to achieve a high percentage of the Abu Dhabi 2030 Strategy, working to further increase Abu Dhabi’s competitiveness in international trade, improve revenues, and ensure the optimal allocation of resources. Moreover, The World Bank ranked Abu Dhabi in 2016 as number one in the Gulf Cooperation Council (GCC) for trading across borders.
“This is a pioneering project in the way that the technology has been used to automate the process and integrate the bank with our ERP. More broadly, it also provides a blueprint and benchmark for other governments in GCC,” says Salem Saeed Al Rumaithi, Executive Director, Technical Affairs Sector at Abu Dhabi Customs.
“The way the project was planned and implemented demonstrates high-quality working relationships both internally and externally,” adds Al Rumaithi. “The cash management solution provided by ADCB which automated the collections in a seamless way through 24/7 multi channels and host-to-host integration has greatly enhanced process efficiency, reporting, reconciliation, and accuracy.”