Customs trade facilitation programs and the reduction of customs-related corruption. Are these concepts connected?

With the trade flows’ increase, the multinationals companies started to chase for lower costs of production in this order these companies changed their production model. Instead focus all its productive chain in one single spot, the companies started to allocate each phase of its productive process in the spots that enabled lower costs for the kind of activity made. Facing this reality, only those countries that were capable of offer competitive costs could participated on these international value chain, excluding many Less Developed Countries (LDC’s) and Developing Countries (DC’s) from the benefits of the trade liberalization. Analyzing the context, is possible realize that a big amount of this problem can be attributed to the low efficiency of the customs authorities in the processing of increasing volumes of trade transactions, inadequate facilities at the land and sea ports, weak physical infrastructure, inefficient bureaucracy and corruption. In this paper will be analyzed the latter reason for the low efficiency of customs authorities, the corruption. As we will see, inadequate customs procedures can create different kinds of problems, among these what most concerns today is corruption. Customsrelated corruption costs to World Customs Organization (WCO) members at least $2 billion of American dollars in customs revenue each year. Using data about bribe payers’ actual experiences in paying bribes, it is possible to show that the adoption of trade facilitation measures would only help reduce the levels of corruption and improve efficiency – in a large number of customs agencies – if the customs agency’s director undertakes a huge approach to reform. Based on corruption clubs theory this paper aims, on one hand, to show which customs agencies in the process of reform are either moving toward OECD levels of integrity and efficiency or, on other hand, which one are sliding toward a “red zone” group of countries. Such a sliding results from the incentives corrupt customs officials have to stymie reform. For instance, countries undertaking reform customs programs – i.e. those endorsed by the World Customs Organization – should not adopt reform measures piecemeal. They need to engage an anti-corruption and efficiency-enhancement programs deeply enough to ensure they benefit from trade facilitation. Removal of such trade barrier though improvement in trade facilitation measures will generate significant rise in trade among those countries. The methodology used in this paper was the analytical and deductive research’s methods in publications of international agencies and the analyze of recent data which shows that trade facilitation programs help decrease corruption only if the customs agency undertakes serious and extensive anti-corruption and efficiency enhancing work.