By advancing the use of information technology and developing an Integrated Foreign Trade System and automating government processes, Chile is aiming at improving its trade process.
Chile Takes another Step to Facilitate Foreign Trade
Chile is one of the most open economies in Latin America and the Caribbean. The country has trade agreements with 52 countries, and foreign trade currently represents more than 70 percent of its GDP. Each year, some 85,000 Chilean firms and individuals process nearly 1.4 million transactions related to export and import operations.
Despite this success, Chile’s foreign trade system still involves a considerable amount of red tape. Exporters spend an average of 22 days just preparing documentation because they have to seek approval from as many as 19 different agencies that do not coordinate with each another and have no standardized procedures. As a result of cumbersome procedures, it takes twice as long as the OECD average for Chilean companies to complete the export process.
This situation is expected to change soon as a result of a partnership between Chile and the IDB to implement an Integrated Foreign Trade System (SICEX), an electronic platform that integrates all documents and processes used by government agencies and serves as a single window to process all foreign trade transactions. The project is part of Chile’s ambitious digital agenda aimed at expanding the use of information technology to improve the delivery of government services to boost competitiveness and lower costs.
The project began in 2011 and the platform is expected to be fully operational by mid-2014.
The platform will allow parties involved in trade and transport to provide standardized information and documents using a single entry point to fulfill all import, export, and transit-related regulatory requirements. If the information is electronic, then individual data elements only need to be submitted once, saving time and money for companies.
According to a study commissioned by the Chilean government, single windows lower trade and government costs, reduce time requirements, and simplify procedures related to permits and regulatory requirements. By using the single window system, Japan, for example, cut the time required to inspect ocean shipments by nearly 7 hours. Korea shortened the time required to clear goods by one day, while Mauritius reduced clearance time from 4 hours to just 15 minutes for non-litigious declarations. In Chile, the single window is expected to cut export processing time and costs by as much as 50 percent.
By the end of 2013, the project is expected to complete the software design and begin platform implementation in five of 15 agencies that will be part of the single window. Nearly 100 people have already been trained in how to use specific service modules of the platform, including the exports pilot module and the different navigation functionalities.
Foreign trade is already working well for Chile. By advancing the use of information technology to automate government processes, the country will make that trade process even better, enabling Chile to make the most of its trade agreements and reap the benefits of deeper integrate into the world economy.
This story is part of the 2013 Development Effectiveness Overview.