VietNamNet Bridge - Every year, businesses lose a total of around $19 billion a year because of customs formalities. Now, the customs agencies, following the lead of taxation agencies, are finally trying to solve the problem.

A survey has found that it takes businesses 21 days on average to fulfill customs clearance procedures for imports and exports, far longer compared with other regional countries, especially those that rival Vietnam in attracting foreign investment, such as China, Indonesia and Cambodia.

Dang Binh An, a consultant with USAID GIG, a project that aims to help upgrade administrative capacity, noted that if the time for customs procedures could be shortened by one day, businesses’ costs would fall by $1.6 billion a year.

Businesses could save would be even more if the time fell from 21 days to 14 days for exports and to 13 days for imports, as stipulated in the Ministry of Finance’s Circular No 119. The circular took effect in early September.

Olin McGill, a consultant to Vietnam on upgrading the business environment, said that Vietnam now requires exporters to show five kinds of documents, while in other countries, only two are required.

Vietnamese businesses need 21 days to fulfill procedures to export products, while Indonesians need 17 days, Malaysians 11 and Thais 14 days.

Vietnam is estimated to lose $19 billion every year due to ineffective trade and the long time needed to follow administrative procedures, one expert said.

The time Vietnamese businesses have to spend on customs formalities is 14 days longer than in the 10 countries with the most convenient procedures.

Phan Vinh Quang, head of the legal division of USAID’s GIG project, noted that the requirement that 60-80 percent of import-export items have to undergo specific verification by competent agencies was troublesome to businesses.

For example, a businessman complained that he had problems with the consignment of compass imports. The Ministry of Industry and Trade told him to have the imports examined by the Ministry of Public Security. However, officials at the Ministry of Public Security refused, saying it did not fall within their area.

A representative of Minh Phuoc Logistics Company in HCM City, a wine importer, said under current regulations, if the first five consignments of imports are recognized as meeting standards, it will not be necessary for the importer’s subsequent consignments of goods to undergo examination.

However, in order to get customs clearance for the sixth and subsequent consignments, companies are required to have a certificate on meeting standards, and then must ask for confirmation from the Food Safety and Hygiene Agency in Hanoi, and finally send the confirmation document to the HCM City branch of the agency.

“Why don’t the competent agencies connect with each other to confirm information themselves to help businesses save time?” he said.