Transcript The Present and Future of Korea’s e-Trade (Paperless Trading)

e-Trade (Paperless) Korea, Innovation 2007
The Present and Future of Korea’s
e-Trade (Paperless Trading)
Capacity Building Workshop on Trade Facilitation Implementation
for Asia and the Pacific Region
March 18, 2005, Kuala Lumpur, Malaysia
Dr. Yoon Say Jeong, Secretary General
e-Trade Facilitation Center
KITA (Korea International Trade Association)
e-Trade (Paperless) Korea, Innovation 2007
Table of Contents
1. Brief History of e-Trade(paperless Trading) in Korea
2. Current Status of Korea’s e-Trade
3. Background of innovating e-Trade strategy in Korea
4. Organization
5. Goal & Strategy
6. To-be Model of e-Trade Service (1/2)
7. To-be Model of e-Trade Service (2/2)
8. Roadmap of 3-year Innovating plan
9. e-Trade Service (Phase 1) – e-L/C System (for Exporter)
10. e-Trade Service (Phase 1) – Conceptual Model
11. Lessons Learned
12. Future work : International Cooperation
e-Trade(Paperless) Korea, Innovation 2007
1. Brief History of e-Trade(paperless Trading) in Korea
 In 1989, Korean government initiated “Comprehensive Trade Automation Plan”
 In 1991, Korea enacted “Act on Trade Automation” and Ministry of Commerce & Industry
(currently MOCIE) made an “Agreement on Trade Automation” with Korean Customs
Service
 In 1991, Korea Trade Network (KTNET, Capital :US$75 million) was established by the
investment of private sector (Korea International Trade Association, 100%)
 Korea Customs Service designated KTNET as sole Trade Automation Service Provider
Korea realized a 100% electronic customs clearance system through both
VAN/EDI and Internet
 Major part of Trade Automation System is customs clearance, But it covers LC advice,
logistics, finance and payments and other trade related B2B services
Samsung Electronics estimates that it has benefited US$800 million through Trade
Automation System every year, reducing ordering time from 10 days to 2 days.
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e-Trade(Paperless) Korea, Innovation 2007
1. Brief History of e-Trade(paperless Trading) in Korea
Diverse Initiatives in Clearance and Cargo Management
• Export clearance P/L system(1995)
• Import clearance P/L system(1999)
• Export automatic clearance system (2000)
• Electronic fund transfer for duty(1999)
Development
stage • Export clearance system(1994) • Electronic Value added tax receipt (2001)
• Import clearance system(1996)
• Export cargo system(1997)
Paperless clearance
P/Lㆍautomatic
• Import cargo system(1998)
clearance system
• Customs duty back system(1997)
Business Process
computerization
process
computerization
Task and statistics
computerization
Trade statistics
computerization
1974
EDI clearance automation
project for 6 years
commencement (’92)
1999
1992
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2001
year
e-Trade(Paperless) Korea, Innovation 2007
2. Current Status of e-Trade in Korea
100% of Customs Clearance and Logistics
Customs
Broker
Trader
Bank
Other Government Agency
MFCS
KTNET
KCS
Air Line
Inspection Co
* KCS : Korea Customs Service
MFCS : Manifest Consolidation System
Bonded
Warehouse
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e-Trade(Paperless) Korea, Innovation 2007
3. Background of Innovating Korea’s e-Trade System
Realization of the National
Future e-Trade Model
Demands for
innovation on
overall process of
trade
Give the opportunity to
innovate whole trading
process with the new IT
technology
The launch of a 3year e-Trade
facilitation plan
Realize seamless etrade service by
connecting effectively
with government and
related organizations
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The core task for
e-government
blueprint
Issue guidelines on
national e-trade future
model
e-Trade(Paperless) Korea, Innovation 2007
4. Organization
 Vision : e-Trade Korea, Innovation 2007
 Organization : National e-Trade Facilitation Committee, July 2003
 e-Trade Process Innovation BPR/ISP : December 2003 ~ June 2004
 e-Trade Service (Phase 1) : December 2004 Private e-Trade Facilitation Committee ~ December 2005
National e-Trade Facilitation Committee
Chair : Prime Minister
Secretary : Ministry of Commerce, Industry and Energy
Private
Public
Administrative Committee
Private e-Trade Facilitation Committee
Chair : Vice Minister of MOCIE
Chair : Ex-minister of MOST
e-Trade Facilitation Center
(KITA)
Logistics
Platform Finance
/Customs
W/G
W/G
W/G
Legal
W/G
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Marketing
W/G
Global
W/G
e-Trade(Paperless) Korea, Innovation 2007
5. Goal & Strategy
2
1
Internet Based
National e-Trade
Infrastructure
3
International
Collaboration for
Cross Border
Paperless Trading
Seamless
e-Trade
Service
Process Innovation
Information Strategic Planning
 Current Process Analysis
& To-be Process Modeling
 e-Trade Platform Design
 Standard
 Integration & Interface
 Action Plan (2004~2007)
 e-Trade Facilitation Center
: PMO
- Marketing
- Financial Settlement
- License/Certificate
- Insurance
- Logistics
- Trade Declaration
 Legal System on e-Trade
 Institutional Model
 Incentive &
Community Supporting System
 Bilateral/Multilateral Agreement
on International Collaboration
Legal Structure
 International Collaboration
 Mutual Recognition
on Global e-Trade
 APEC, WCO, UN/CEFACT,
PAA, EU IST, ASEM, Asia PKI
Global Network
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4
Acceleration
of e-Trade
Community
e-Trade(Paperless) Korea, Innovation 2007
6. To-be Model of e-Trade Service (1/2)
Trade Automation
Global e-Trade
AS-IS
(Trade Network)
License/
Certificate
Authority
...
(e-Trade Platform)
e-Trade Platform
① e-Trade Service
Customs
Service
Marketing
②
③
KTNET
Financial Settlement
②
Trading Company
Bank
Declaration
Trading Company
③
Trading Company
Trading Company e-Trade Infrastructure
2nd Wholly
Responsible
Company
Mess
e-Doc
e-Standard
aging
Repository
Registry
Hub
Bank
License/
Certificate
Authority
② Customs
Service
License/Certificate
Logistics
①
TO-BE
Bank
Logistics
Company
Global
④ Network
③
① Seamless e-Trade Service on Single-Window
② One Submission, No Multiple Submission for Same
Online Document and provide diverse customs service
(EDI, Web)
③ Guarantee of Online Document Originality Exchanged on
Central e-Trade Repository under the law
④ Global Networking on National e-Trade Infrastructure
① 1:1 Networking by Wholly Responsible Company,
Breaking Online Process Flow
② Submission of Same Document Repeatedly to
Several Parties
③ Exchange of Online Document between Trading Partners,
but Submission of Offline Paper Document to Third Party
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e-Trade(Paperless) Korea, Innovation 2007
7. To-be Model of e-Trade Service (2/2)
Financial
Settlement
Bank
Marketing
eMarketPlace
Credit
Card
License/Certificate
Insurance
KFTC
Credit
Evaluation
Company
Insurance
Company
Insurance
Company
Trading Company
(Including SME)
e-Trade
Single Window
e-Trade Platform
Certified
Certificate
Authority
Customs
Service
National Logistics
Single Window
Global Networking
Standardization
Agency
Document
Standard
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Global e-Trade Hub
e-Trade(Paperless) Korea, Innovation 2007
8. Roadmap of 3-year innovating plan
• Upgrade User’s e-Trade System Environment
Phase3
 e-Trade solution for SME
(’07)
• Establish Global Network
• Upgrade Core Infra fulfilling Seamless eTrade Service Implementation
Phase2
 License/Certificate & Marketing support system
(’06)
• Interface with Related Parties
Phase1
(‘04-’05)
• Building Core Infra of e-Trade Platform
• Standardizing documents
 e-Trade document circulation system
 ebXML based document standardization
• Reform related Laws and Systems
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e-Trade(Paperless) Korea, Innovation 2007
9. e-Trade Service (Phase 1) – e-L/C System (for Exporter)
L/C by EDI
e-L/C Consolidation &
Circulation System
AS-IS
Goal : Advise L/C by EDI
Goal : No more Paper L/C Presentation
Process :
 Advise L/C online (EDI)
(75,000 by EDI out of 600,000 SWIFT transaction)
 Print out Advised L/C on Beneficiary side
 Presentation of Printed Paper L/C for Negotiation
 Endorse the Balance on Nego
Opening Bank
 Circulate Endorsed Paper L/C
Support :
 e-L/C Life Cycle Management
 e-L/C Negotiation History Management
 e-L/C Balance Management
L/C EDI
Exporter
TO-BE
Opening Bank
KTNET
Messaging Hub
e-L/C
Advising Bank
Advise, Amend
Nego
Exporter
Advising Bank
Transfer
Print Out
1st Negotiation Bank
2nd Negotiation Bank
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Negotiation Bank
2nd Beneficiary
e-Trade(Paperless) Korea, Innovation 2007
10. e-Trade Service (Phase 1) – Conceptual Model
Systems
Purpose
Repository
e-L/C system
Red : New System by June 2005
- Prevention of Re-key
- Certification of Contents
- Keeping Transaction history
Trading Company
Blue : Existing System
L/C Opening Bank
The world’s first
e-L/C system
KFTC
Advising Bank
e-L/C
(Advise, Amend, Transfer, Nego)
ebXML on VPN
Service
Portal
Web
Services
e-L/C Consolidation & Circulation System
Balance
Management
Circulation
Management
Negotiating Bank
Messaging
Hub
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e-Records
Circulation
e-Records
Repository
(Pilot)
e-Trade(Paperless) Korea, Innovation 2007
11. Lessons Learned
 Strong leadership is a critical factor in the successful implementation of
paperless trading. Close inter-ministry cooperation among regulatory
parties is necessary.
 Modernization of customs procedure, system is most important step
 To hear voices from business community is important because paperless
trading is not only technical but also cultural issue to business community.
 It is essential that support from international organizations related to e-trade
standard/ technology and developed countries should be provided to
developing countries for realizing global paperless trading
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e-Trade(Paperless) Korea, Innovation 2007
12. Future work : international Cooperation
 Participate in paperless trade activities such as APEC, ASEM, WTO, and PAA etc.
- Korea successfully held the 1st APEC PPP(Public-Private Partnership) Dialogue under ECSG
meeting in SOM I, February 2005
- Korea has been worked closely with PAA (Pan Asia eCommerce Alliance) member countries
to make e-Trade networks in Asia
 Korea has experience in building Paperless Trade System since 1991
 We would like to share Korea’s 14-year-experience with other countries
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e-Trade(Paperless) Korea, Innovation 2007
Contact Information
Thank you
Dr. Yoon-Say Jeong
Secretary General
e-Trade Facilitation Center
 Email : [email protected]
 Phone : 82-2-6000-5433
 Fax : 82-2-6000-2307
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