In an increasingly globalized economy, international trade plays a vital role in national development. However, efficient, fair, and transparent customs administration remains essential for smooth cross-border commerce. Customs valuation—the process of determining the taxable value of imported goods—stands as a cornerstone of customs operations, directly impacting government revenue, trade fairness, and market integrity.
Togo, a small West African nation, faced systemic challenges in its customs valuation system for years. Weak oversight and insufficient technical capacity at the Togolese Revenue Office (OTR) led to significant revenue losses, undermining national development. Seeking solutions, Togo requested technical assistance from the World Customs Organization (WCO), the global authority on customs matters, to rebuild its valuation framework.
1. Challenges in Togo's Customs Valuation System
1.1 Outsourcing Pitfalls
OTR had previously outsourced core customs valuation functions to third-party operators—a cost-saving measure that created long-term vulnerabilities:
- Weak oversight allowed valuation discrepancies and potential fraud
- Revenue leakage occurred through undervaluation and origin misdeclaration
- Information asymmetry left OTR dependent on external operators
- Conflicting priorities between profit-driven contractors and national interests
1.2 Infrastructure Deficiencies
Togo's customs lacked modern valuation tools:
- Outdated scanning and inspection equipment compromised physical controls
- Legacy IT systems couldn't support comprehensive valuation databases
1.3 Capacity Gaps
Valuation staff faced multiple challenges:
- Insufficient theoretical knowledge of valuation principles
- Limited practical experience in complex cases
- Scarce professional development opportunities
1.4 Risk Management Weaknesses
The absence of robust risk assessment mechanisms left borders vulnerable to exploitation.
2. The WCO Capacity Building Program
WCO designed a three-phase technical assistance program (2015-2018) to transform Togo's customs valuation system.
2.1 Phase I: Diagnostic Assessment (November 2015)
WCO experts conducted comprehensive evaluations of:
- Legal and regulatory frameworks
- Operational workflows and infrastructure
- Staff competencies through interviews and observations
2.2 Phase II: Trainer Development (May 2016)
WCO implemented a "train-the-trainer" program featuring:
- Theoretical instruction on WTO Valuation Agreement principles
- Practical case studies from regional trade patterns
- Simulation exercises for complex valuation scenarios
2.3 Phase III: Electronic Solutions (November 2018)
The final phase focused on digital transformation:
- Development of an electronic valuation database in Lomé
- National workshop on risk assessment methodologies
- Implementation support for new IT systems
3. Program Outcomes
3.1 Enhanced Valuation Capacity
Togo developed:
- A core team of valuation specialists
- Modern risk assessment capabilities
- Digital tools for trade data analysis
3.2 Fiscal Improvements
Revenue collection increased through:
- Reduced valuation discrepancies
- Improved fraud detection
3.3 Trade Facilitation Benefits
Streamlined processes decreased clearance times for legitimate trade.
4. Implementation Challenges
Togo's transition revealed key obstacles:
- Low compliance awareness among traders
- Gaps in legal frameworks
- Enforcement resource constraints
5. Policy Recommendations
WCO advised Togo to:
- Strengthen trader education programs
- Modernize valuation legislation
- Enhance regional cooperation
- Invest in continuous staff training
6. Lessons for Developing Nations
The program demonstrated that effective capacity building requires:
- Multi-phase, sustained engagement
- Local ownership through skills transfer
- Context-specific solutions
- International knowledge sharing
This initiative stands as a model for customs modernization in resource-constrained environments, proving that systematic technical assistance can transform trade administration while protecting fiscal interests.