Shipping & Logistics

shippinglogistics The Malta Independent on Sunday MARCH 2018

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BREXIT: Customs Preparations

By JOSEPH CHETCUTI, Director General, Customs Department

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he United Kingdom is expected to leave the European Union on the 29th March 2019, thus becoming a third country to the EU. In the absence of a deal, the Customs administrations in the EU will have to enforce EU rules for both exports to, and imports from, the UK. Therefore, the formalities that currently apply to trade with non-EU countries will apply, including the submission of customs declarations for goods and the related controls to ensure compliance. Duties and taxes will have to be accounted for.

The main concern for Customs will be that of dealing with the volumes associated with formalities and their implications. This will result in additional documentation and data requirements for businesses, processing and controls for Customs, and infrastructure requirements for both, including IT and physical infrastructure to allow appropriate riskbased controls.

Customs declarations for all consignments imported from, or exported to, the

UK, as groupage cargo, containers, fast parcel, postal service and airfreight will have to be lodged in the Customs IT systems and risk analysed. A percentage of these consignments will then be selected for physical control by Customs officials.

Malta Customs has been, slowly but surely, preparing for Brexit and it is as ready as it can be in the circumstances.

From an initial assessment, the following will have to be catered for:

Cargo traffic: • Groupage Cargo - on average, 25 trailers per week convey cargo from the UK to Malta by road, resulting in around 250 additional Customs declarations lodged every week.

• Container loads – on average, 30 full load containers are imported from the UK every week resulting in as much additional declarations per week.

• Airfreight: Airfreight consignments from the UK amount to 100 per week resulting in as much additional weekly declarations.

• Courier & Parcel Post traffic: Currently around 5,500 parcels are received every week from the UK by courier operators, while a comparable number of parcels arrive by parcel post. It is pertinent to highlight that this is a very fluid area due to the continuous, exponential increase in e-commerce.

Overall and to meet these volumes, the

Department will be increasing its staff complement in the cargo area by 25%.

On the other hand, the reselience of the Department’s I.T. infrastructure is deemed adequate and the National Import System and the National Export System are geared up to handle the increase in workload associated with Brexit. As a rough estimate, it is envisaged that more than 7,000 additional declarations will be lodged every week. This figure is considered to be conservative and does not take into consideration the additional declarations that will have to be lodged from 2021 onwards for those consignments having a value of €22 or less. However, this comes at a cost because these systems will have to be reconfigured to accommodate restrictions, risks and other obligations associated with controls.

Passenger traffic: • 12 additional inbound and 12 additional outbound flights with 160 passengers each, every day, are expected from the UK. Therefore, an increase in the monitoring of accompanied luggage and cargo brought through these flights is required.

The increase in flights to and from the UK may also require some infrastructural changes at the arrivals and departures lounges, something which must be dealt with by the private operator.

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To meet these challenges, Malta’s Customs Department has already increased its staff complement at the Airport by 25% and same complement is expected to be strengthened by an additional 15%.

Planned initiatives: • Road show - The Department intends to initiate a road show during the first two weeks of March with the Malta Chamber of Commerce, the General Retailers & Traders’ Union, the Fast Parcel operators, the Hal Far Groupage operators, the Shipping Agents’ Association, the Malta Employers Association, the Gozo Business Chamber and the Burdnara Association to explain what are the lines to be taken for goods imported from and exported to the UK; • Malta International Airport - The Department is discussing with MIA the issue of infrastructural changes at the arrivals and departures lounges and on the actions that are to be taken on passenger traffic to and from the UK; • Registration of Economic Operators As highlighted earlier on, from 30th March, 2019, 00:00 hours (CET), all imports from, and exports to, the United Kingdom will need to be covered by a Customs declaration in the electronic systems. Therefore, the Customs Department is calling on those economic operators who either solely trade with the United Kingdom, or who trade exclusively with the United Kingdom and the European Union, to register with the Customs Department to obtain an Economic Operator Registration Identification (EORI) number, by sending

an e-mail to eori.customs@gov.mt or by calling on telephone number 25685121.

Further details may be obtained through the following link- https://customs.gov.mt/bus/economic-operatorsregistration-identification; • Business 1st presence - In line with the Customs Department’s strategy on the need to improve customer experience, and in accordance with the planned initiatives in preparation to Brexit, the Department’s customer care services will be included in the one-stop-shop Business 1st initiative of Malta Enterprise.

For this reason, as from Thursday, 14th March, 2019, one Customs official from the Customs Economic Procedures Unit, and/or an official from the Department’s Customer Services, will be reporting for work at the Business 1st premises, in Mrieħel, once a week, to assist the business community in its queries; • Real-time on-line payment system As from April, 2019, all economic operators will be able to settle payments of taxes due to the Customs Department via the banks’ IBAN infrastructure, or by credit or debit cards, through a realtime on-line payment application; and • Equipment - A new luggage scanner is being purchased to screen luggages on arrival before they are placed on the conveyor belts.

The Customs Department is committed to adopt an approach that puts customer understanding at the heart of its initiatives and to proactively strive to improve stakeholders’ satisfaction. This means that the Department will maintain its dedication to enhance quality service.

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EU-JAPAN TRADE DEAL comes into force to create WORLD’S BIGGEST TRADE ZONE Two new landmark agreements between the EU and Japan came into effect last month: the Economic Partnership Agreement and the Strategic Partnership Agreement. The economic agreement is the largest bilateral trade deal ever made by the EU in terms of market size and will be the largest zone of free trade created in history.

EMIL KIRCHNER reports

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t drastically reduces tariffs between the EU and Japan, paving the way for simpler and faster trade between the two, and therefore an increase in volume. The strategic partnership commits to security cooperation on issues like nuclear proliferation, regional security, international terrorism and organised crime, cybersecurity, and energy and climate security.

As Han Dorussen and I explain in our new book EU-Japan Security Cooperation: Trends and Prospects, these agreements

come at a crucial time in the development of international trade and global governance.

Brexit has the UK trying to redefine its relationship with the EU and potentially forge its own trade policies with the rest of the world.

Perhaps more importantly, the new EU-Japan agreements stand in direct contrast to Donald Trump’s decision to introduce an “America First” trade policy.

Since being elected president in 2016, Trump has emphasised bilateral deals, erected trade barriers and undermined international institutions like the World Trade Organisation.

Indeed, it was the anticipation of Trump’s nationalist policies, and especially his withdrawal from the Trans-Pacific Partnership (TPP) trade agreement, that gave renewed impetus to the EU and Japan’s lingering negotiations of the two agreements. Large trade agreements take a notoriously long time to negotiate and talks between the EU and Japan first began in 2013.

Japan and the EU – and Germany in particular – are export-driven economies and advocates of open trade. The protectionist stance of President Trump left them feeling vulnerable. So the new economic agreement is seen as strongly

reaffirming the rules-based international trading system.

The concessions Japan offered to the EU on agricultural products are a blow to US farmers, who for a long time had been hoping to pry open this sealed market. The EU-Japan deal will emphasise Japan’s commitment to free trade and give a further thrust to the newly-formed multilateral trade agreement known as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which rose from the ashes of the TPP after the US withdrawal.

Opening up trade The EU-Japan economic agreement will ultimately remove 97% of the tariffs that Japan applies to European goods and 99% of those applied by the EU. It is estimated that EU companies will save €1 billion a year in duties which they currently pay when exporting to Japan. A number of longstanding regulatory barriers, for example on car exports, will also be removed.

The agreement will open up the Japanese market of 127m consumers to key EU agricultural products and increase EU export opportunities

All smiles. EPA/Francois Walschaerts/AP Pool in many other sectors such as financial services. As Japan will scrap duties on agricultural products, the Europeans stand to gain most from exports of consumer products, such as cheese, pork, and wines.

Japan’s main interest in a trade deal with Europe was to increase its auto industry exports. The EU currently imposes a 10% tariff on Japanese cars. Under the agreement, it will lower this to zero over eight years.

Although cars and auto components account for about a fifth of Japan’s exports to Europe, Japanese car makers’ share of the European market is only about 10% – much lower than in the US or Asia.

Besides these improvements, the economic agreement will strengthen cooperation between Europe and Japan in a range of

areas. It will reaffirm their shared commitment to sustainable development, and include for the first time a specific commitment to the Paris climate agreement.

EU firms already export more than €58 billion in goods and €28 billion in services to Japan every year. This will grow, and the strategic partnership will lead to further deepening of EUJapan relations and engagement across a wide range of global, regional and bilateral thematic issues. It reaffirms the shared values and common principles that form the basis of EU-Japan relations, including human rights, democracy and the rule of law.

Together, the EU and Japan’s economies account for about a third of global GDP. The new trade agreement should therefore serve to bolster the global economy, as well as marking a strong commitment to multilateralism by two of the world’s biggest economies.

Emil Kirchner is an Emeritus Professor, Department of Government, University of Essex.

This article was originally published on The Conversation.

Thomas Smith strengthens their portfolio by expanding shipping networks in the Far East

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homas Smith, a staple name both in Malta and abroad in the business of Shipping and Logistics services, is now offering a stronger and wider shipping network from the Far East. The existing container groupage service is now available to an even wider network from numerous Asian countries.

Together with trailer and container services operating from European destinations, Thomas Smith now has a hub in Singapore to cater for clients’ growing shipping needs.

Thomas Smith is now able to offer clients groupage services to Malta through the Indian Ocean and the Middle East shipping routes. Through this avenue, extensive alternatives have been made available for cargo imports originating from Bangladesh, Cambodia, China, Hong Kong, India, Indonesia, Japan, Malaysia, Pakistan, Philippines, Singapore, South Korea, Sri Lanka, Taiwan, Thailand, Vietnam and the United Arab Emirates.

This wider network also allows Thomas Smith to handle FOB and Ex-

works shipments from all over Asia. The strength of Thomas Smith Shipping not only lies in the years of experience that the company holds, but also in the strong personal network presence that Thomas Smith has in these countries, using the local know-how as a strategic advantage. Thomas Smith can also ensure Product Quality Control on these shipments.

Merchandise from all the above territories is consolidated through Thomas Smith’s hub in Singapore.

Transit times range from 16 days to 30 days depending on the cargo’s origin.

Groupage export is now also possible from remote countries and places in Africa, such as Angola, Nigeria, Djibouti and Congo.

By adding these destinations to its portfolio, Thomas Smith’s customers are now getting the best shipping service, irrespective of the destination from where cargo is imported.

With an array of approved international partners, gathered along years of operations in the shipping field, Thomas Smith promises that Container Groupage

services will match the rapid handling and qualified service offered through all the company’s current freight services.

For a complete solution to your logistics business, contact our Business Development manager on 2205 8134.

Thomas Smith Group is one of the longest established service group of companies on the island, specialising in international shipping services and insurance. The Group holds a leading market position in most shippingrelated services

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BRITAIN’S LONG HISTORY OF TRYING – and failing – to gain independence from EUROPEAN TRADE PARTNERS In 1585, English scientist Thomas Hariot dreamt of the opportunities Atlantic trade would offer to Britain as he strove for his country to break away from continental and Mediterranean trading routes to ensure a profitable future for him and his countrymen. Silks, wine, oil, oranges, lemons would all come from the new world – and indeed, Atlantic trade did boom and Britain prospered.

GIADA PIZZONI reports

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ut it was the European continent that facilitated this success by making the necessary trade deals possible. More than 400 years later, the UK is once again dreaming of the unimaginable riches that could be had by breaking away from the old continent. Brexit would have globalisation in trade as the answer, but over the past four centuries as its empire has risen and fallen, it is Europe that provided the UK with many of its most sought after commodities. It’s hard to imagine this changing much in the future.

In the 16th century, European expansion into the New World was in full swing. Britain was certain that the Atlantic Ocean would offer unlimited opportunities and incredible wealth. It hoped for the same fortunes that had befallen the Spanish – a land full of gold, silver and a native population that it could enslave.

But the British were soon disappointed by their discoveries. The northern part of the Americas did not have the same mineral-rich mines as the south. There was, however, fertile soil ideal for growing crops. And so the British began to set up plantations; displacing the native population, importing slaves, growing tobacco, cotton, sugar, and fishing cod. These staples soon proved extremely profitable and enriched both planters in the colonies and merchants at home while funding what would go on to become a great empire. Finally, Britain thought, it was possible to break the continental yoke and find new lands and markets.

Europe as a bridge Unlimited opportunities seemed to lie ahead, but it was not to last. The empire rose and shrank, and despite the importance of newly emerged Atlantic links, the Mediterranean remained crucial for Britain’s balance of trade and ensuring its global exchanges.

Even under full imperial expansion, tapping into continental markets as sources of imports and as

A British ship in a Mediterranean harbour.

Thomas Luny via Wikimedia Commons consumers of British exports was still essential. Britain soon became one of the most important markets in the world as it re-exported American products all over Europe and beyond. But, again, the balance of trade relied upon the continent, and non-European trade was profitable only because of existing continental demands.

Spain, for example, was a crucial trading partner throughout the 16th and 17th centuries. Britain needed to tap into the Spanish imperial markets that were vital for the development of its booming economy at home. Spain acted as a bridge for moving American gold, silver and dyes to the north of Europe, in exchange for Atlantic cod and the tools Britain needed to build its colonies.

Meanwhile, Mediterranean fruit went to the British Isles, together with olive oil, Ionian currants and Levantine spices.

As I’ve found in archival research for my forthcoming book on the period, the British had an insatiable appetite for Mediterranean products and the new global markets

were part of a system that helped Britain balance its books with Europe. Ultimately, it was continental Europe that made Britain’s global exchanges truly viable and the North American trade profitable. Despite the focus on the Atlantic, the Mediterranean stayed relevant, representing almost half of British imports and exports.

Now, as before, Britain aims to revitalise its links with the world beyond the EU. It is looking to the US, India, China, Japan and Australia for trade deals. Surely, it thinks, all those countries are waiting to rekindle their old commercial links.

Perhaps, but the rules of the international system have changed – in colonial times Britain benefited from slavery and unfair trade practices.

Then there’s the issue of what Britain will export to these countries. A great deal of UK manufacturing and the exports produced is built on EU single market supply chains. As before, Britain remains reliant on its neighbours and biggest trade partner at present.

It is undeniable that the discovery of new territories and trade routes in the 16th century brought Britain benefits.

But this trade was successful because Britain was able to trade these products with continental Europe.

Needless to say, we live in different times and the goods (and services) being traded take a different form. But Britain should learn from its history where it was reliant on the rest of Europe for its successful global trade and the fact that it has never been able to break away from the continent, despite repeated attempts.

Giada Pizzoni is a teaching Fellow in early modern history at the University of Warwick. She specialises in seventeenth century British History and she looks at trade and religion and how they shaped national identity. This article was originally published on The Conversation.

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EXPRESS TRAILERS stre MOSTA TRI TEAM to insp towards a more ACTIVE L T

wo years ago, the Mosta Cycling Club launched its Mosta Tri Team with Express Trailers as its main sponsor. Over the last two seasons club membership participating in triathlon has increased to the extent that today, the club with around 30 registered triathletes is the most represented

club with the Malta Triathlon Federation.

“Through our financial support to voluntary sports organisations such as the Mosta Cycling Club and its Triathlon Team, we seek to assist them as they bring up not only athletes but role models that can inspire our youth towards a more active lifestyle,” said Franco Az-

zopardi, Chairman and CEO of Express Trailers.

“Winning is a celebration of effort and success. However, it remains a finite state. The clubs’ objectives should also be to give opportunities of coaching and competitive participation to those who want competition.

Above all, being in a club is an opportunity for belonging to a

group that encourages healthy camaraderie and active lifestyle.

We are delighted to be part of these clubs’ noble endeavours to give this opportunity to so many people of any age and ability,” added Franco Azzopardi.

“Apart from always having an athlete or two representing our club on the overall podium, other athletes are also winning

their age group category, resulting in more podiums and more exposure for our club,” says Edward Enriquez, Secretary of the Mosta Cycling Club.

In fact, recent successes for the Mosta Tri Team included 2nd and 3rd overall placings for our Wayne Spiteri and Bernard Sant in the National Triathlon Championship in which other athletes

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engthens pire youth LIFESTYLE of ours, also placed first in the various age groups. Excellent results were also achieved in the latest edition of the Tramuntana Winter Triathlon Challenge where Nikol Micallef placed 1st and Malcolm Vassallo placed 2nd.

Express Trailers has been supporting road sports particularly road running and cycling events

for a number of years. This support is also spurred by the company’s commitment to promote road safety especially with regards to runners and cyclists who amongst the most vulnerable on the road. “It is our contribution to society for any inconvenience we may cause through our work,” concluded Franco Azzopardi.

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TRANSFORMING OUR COUNTRY’s logistical infrastructure Hon Ian Borg, Minister for Transport, Infrastructure and Capital Projects: This government recognises the pivotal role that logistical infrastructure has in the economic development of our country.

Aligning the needs of today and tomorrow with the development of infrastructure is the only way that we can ensure that the country’s infrastructure works at an optimum level. We are therefore upgrading our road network to a higher quality one, we will regenerate the harbour and maximise the potential of our port and we will continue to work to ensure that the aviation industry keeps gaining momentum – this is our vision.

We are working tirelessly to ensure that our island continues to expand its maritime and aviation services in order to maintain its position as a prime maritime and aviation hub. Our island is and will remain synonymous with a flag of confidence.

MARITIME

The LARGEST SHIP REGISTER IN EUROPE and the 6TH IN THE WORLD A STRONG and REPUTABLE ship register Over 78 million gross tons under the Merchant Shipping Act Almost 3,000 MERCHANT VESSELS flying the Maltese flag More than 750 SUPER YACHTS flying the Maltese cross 3% INCREASE in registered gross tonnage over 2017 10% INCREASE in super yacht registration over 2017

AVIATION

An ATTRACTIVE JURISDICTION for aircraft registration More than 300 registered aircraft 134% GROWTH since 2012 34 Active Air Operators

ROADS

UPGRADING our road infrastructure Works on 300 residential roads €70 MILLION investment on Marsa Junction in progress €55 MILLION Central Link Project to begin this year MAJOR WORKS on arteries, junctions and roundabouts