Imagine a Malagasy entrepreneur carefully packaging exotic handicrafts for export to European markets. In the past, their mind would be filled with concerns about cumbersome customs procedures, unpredictable tariff disputes, and prolonged uncertainty. These barriers acted as invisible shackles, restraining entrepreneurial spirit and hindering economic development. Today, this reality is changing.
Through the establishment of a national advance ruling system with support from the World Customs Organization (WCO), Madagascar is transforming its trade landscape. This system allows businesses to obtain binding customs decisions on product classification and applicable duties before goods are shipped, creating unprecedented predictability for traders.
Trade Facilitation as a Global Growth Engine
In an era of globalization, international trade serves as a vital engine for economic growth. However, complex customs procedures, opaque trade policies, and high transaction costs often create significant barriers, particularly for developing nations. Trade facilitation—the simplification and harmonization of trade processes—has emerged as a critical solution to reduce costs and boost efficiency.
The WCO, as the global authority on customs matters, has been at the forefront of enhancing trade facilitation worldwide. Through standard-setting, technical assistance, and capacity building, the organization helps member states improve customs administration and optimize trade environments.
WCO-Madagascar Partnership: Building a Roadmap for Trade Facilitation
Madagascar, an island nation rich in natural resources and cultural heritage, has faced developmental constraints due to infrastructure limitations and imperfect trade policies. To address these challenges, the WCO has partnered with Malagasy customs authorities under the EU-WCO HS-Africa Programme, with additional support from the Global Alliance for Trade Facilitation.
This comprehensive support package includes capacity-building workshops, provision of Harmonized System (HS) tools and publications, plus technical and advisory assistance across all aspects of advance rulings. The collaboration aims to equip Malagasy customs officials with specialized knowledge and skills to process classification ruling requests efficiently.
Capacity Building: Developing Expertise for Sustainable Implementation
The effective operation of an advance ruling system requires a cadre of trained professionals. To this end, the HS-Africa project conducted a national workshop on the HS and commodity classification in Antananarivo from June 27 to July 1, 2022. This event brought together over 25 senior and mid-level customs experts—the backbone of Madagascar's customs administration.
The workshop built upon foundational training delivered earlier in March 2022, providing deeper technical knowledge about specific product categories. Special attention was given to HS Chapters 1-24 and Sections XI, XVI, XVII, and XVIII—covering essential commodities like foodstuffs, agricultural products, textiles, and machinery. Practical exercises reinforced theoretical learning, enhancing participants' problem-solving abilities.
Knowledge Sharing: Learning from Global Peers
The workshop featured expert moderators from Burkina Faso, Mauritius, and France who shared their national experiences in laboratory cooperation and proposed practical solutions. These exchanges provided Malagasy officials with valuable insights into laboratory management, sample testing, and data analysis practices from more experienced customs administrations.
System Launch: A Transformative Moment
On July 5, 2022, Madagascar marked a significant milestone with the official launch of its advance ruling system in Antananarivo. In a congratulatory message, WCO Secretary General Dr. Kunio Mikuriya commended the progress achieved through collaborative efforts between Malagasy Customs, the National Trade Facilitation Committee, the Global Alliance for Trade Facilitation, and the WCO.
This system enables businesses to obtain binding customs decisions on product classification and duty rates before shipment, eliminating uncertainty about potential additional costs or delays due to valuation or classification disputes.
Laboratory Development: Strengthening Technical Foundations
Following the system launch, Malagasy Customs held a virtual consultation on July 19, 2022, regarding laboratory development. Two laboratory experts from Spanish Customs—who have supported multiple countries in establishing laboratory projects—led the session. Participants concluded that establishing a dedicated customs laboratory, guided by WCO standards, would be essential for ensuring the advance ruling system's effective operation.
The Value of Advance Rulings
Advance rulings—binding customs decisions issued before goods are imported or exported—offer several key benefits:
Risk Reduction: Businesses gain clarity on applicable duties and taxes before shipment, preventing unexpected costs.
Efficiency Gains: Pre-cleared goods face fewer inspections, accelerating clearance and reducing logistics expenses.
Predictability: Binding decisions provide legal certainty for business planning.
Compliance Enhancement: Companies better understand customs regulations, reducing violation risks.
WCO's Comprehensive Support Framework
The WCO's assistance to Madagascar encompassed multiple dimensions:
Capacity Development: Workshops and training programs covering legal frameworks, operational procedures, and technical standards.
Technical Assistance: Provision of HS tools, classification guides, valuation manuals, and expert consultations.
Knowledge Exchange: Facilitating peer learning from experienced customs administrations.
Infrastructure Support: Guidance on establishing a modern customs laboratory.
Broader Implications for Developing Economies
Madagascar's experience offers valuable lessons for other developing nations pursuing trade facilitation reforms. The establishment of an advance ruling system represents a strategic investment in trade competitiveness—reducing transaction costs while improving transparency and predictability.
Looking ahead, Madagascar must continue refining its system and integrating it with other trade facilitation measures to maximize benefits. Complementary reforms—such as streamlined procedures, enhanced infrastructure, and regional cooperation—will be essential for realizing the full potential of trade-led growth.
The WCO remains committed to supporting Madagascar and other developing countries in building efficient, transparent customs systems that foster inclusive economic development within an open, rules-based global trading system.