Imagine a national customs authority – the guardian of tax revenue and trade regulation – outsourcing its core commodity classification work to private companies. This scenario, which might sound unthinkable, was precisely the reality Ghana Customs faced just years ago. Determined to change this situation, Ghana embarked on a transformative journey to reclaim this vital function, with crucial support from the World Customs Organization (WCO).
The Turning Point
From June 15-19, 2015, a landmark "Revenue Package National Workshop" sponsored by the WCO's Japan Customs Cooperation Fund took place in Accra. The central agenda: establishing an in-house Harmonized System (HS) department to replace private inspection companies in classifying goods. For the Ghana Revenue Authority (GRA) Customs Division, regaining control over tariff classification formed a key pillar of its 2015-2018 strategic plan, scheduled for implementation by September 2015.
Why Reclaim Classification Authority?
Outsourcing commodity classification, while seemingly efficient, carried significant risks. First, it potentially led to revenue leakage, as profit-driven private companies might prioritize client satisfaction over accurate classification that maximizes state revenue. Second, it eroded customs' institutional capacity, leaving officers without practical experience to navigate increasingly complex international trade environments. Most critically, it compromised national sovereignty by relinquishing control over tariff systems – a crucial economic lever – to private entities.
WCO's Strategic Support
The WCO provided comprehensive assistance through this transition. Beyond financial support, it deployed expert teams offering technical guidance on classification systems and customs administration. Wallace Akondor, then-Commissioner of the GRA Customs Division, emphasized that establishing a stable organizational structure, deploying modern classification tools, and training specialized personnel were essential to reclaiming classification authority from private inspection companies and ensuring proper revenue collection.
A WCO representative underscored that building robust classification infrastructure – including establishing an HS department and implementing advance ruling systems – would be critical for achieving GRA Customs' objectives while facilitating international trade.
Workshop Outcomes
The intensive workshop equipped nearly 40 senior and mid-level managers (including members of the Customs Modernization Project Team) with both theoretical knowledge and practical implementation strategies. Participants engaged with newly developed WCO materials including:
- The Customs Infrastructure Guide for Tariff Classification, Origin, and Valuation
- Technical Guidelines on Advance Rulings for Classification, Origin, and Valuation
- Diagnostic Tools for Tariff Classification, Valuation, and Origin Work
The Road Ahead
Ghana's path to full classification autonomy requires sustained effort across several fronts:
- Building institutional capacity: Establishing a professional HS department staffed with experts possessing comprehensive knowledge of commodities, regulations, and customs procedures.
- System modernization: Developing robust classification protocols that ensure consistency, accuracy, and accountability in decision-making.
- International collaboration: Maintaining active engagement with the WCO and global customs networks to address transnational classification challenges.
- Implementing advance rulings: Allowing importers to obtain binding tariff determinations before shipment, reducing trade uncertainty.
- Digital transformation: Leveraging information technology through classification databases and digital tools to enhance efficiency.
Broader Implications
Ghana's initiative reflects a growing recognition among developing nations that tariff autonomy constitutes both an economic necessity and a sovereign right. While technical and institutional challenges remain, such efforts – when supported by international organizations like the WCO – can help nations strengthen fiscal governance, protect domestic industries, and participate more equitably in global trade.
This case demonstrates how reclaiming customs sovereignty forms part of a larger narrative of economic self-determination in the developing world – one where balanced international cooperation complements national capacity building to create more sustainable and equitable trade systems.