Corruption and political interference major obstacles for Customs reforms, says World Bank
The World Bank’s Customs Reform in Developing Countries report identifies several sources of bottlenecks in customs administration, with political interference and corruption being among the key issues.
According to the report, political patronage is a major concern in customs, as it often leads to well-paying jobs and rent-seeking opportunities. This, the World Bank notes, can lead to tariff evasion and other forms of corruption, especially in countries where the political establishment holds links to trading businesses.
Customs officials, the report asserts, are also under the influence of family ties, kinship, and social relations, which makes it difficult to implement anti-corruption reforms. It is difficult to prove a lack of integrity in environments where data are missing and controls are lacking. Additionally, in settings where political appointments at the front line are numerous, the controls by the heads of customs become more complex. This makes it even more challenging to improve the situation.
Another source of bottlenecks in customs administration the report further reveals, is the complexity of laws and procedures. The multiplicity of actors involved, including brokers who manage relationships between officials and traders, adds another layer of exposure for corruption. Moreover, the spatial dispersion of customs officials across a territory makes it more difficult to monitor and control customs operations.
The report notes that the typical principal/agent approach to governance is already challenged in countries plagued by widespread corruption. Therefore, it is crucial to find innovative ways to reform customs administration and improve its effectiveness. This includes implementing effective measures such as automation of customs processes, risk management, and targeted inspections of high-risk goods.
To address political interference and corruption, the report suggests creating a professional customs service that is independent of political influence and has adequate resources to perform its functions effectively. It also recommends promoting transparency and accountability in customs operations, including the use of performance indicators and the publication of customs data. In addition, the report suggests engaging civil society and the private sector in customs reform processes to ensure that reforms are responsive to the needs of stakeholders.
The World Bank’s report highlights the sources of bottlenecks in customs administration in developing countries. Political interference, corruption, and the complexity of laws and procedures are among the key issues that need to be addressed to improve the effectiveness of customs administration.
To achieve this, it is crucial to create a professional customs service that is independent of political influence and promote transparency and accountability in customs operations. By doing so, customs administration can contribute to a stronger fiscal position and increased revenue collection for the government.
