iBusiness, 2013, 5, 1-6
doi:10.4236/ib.2013.52B001 Published Online June 2013 (http://www.s cirp.org/jour nal/ib)
Copyright © 2013 SciRes. IB
The Impact in Customs Efficiency of the ITSW: Mexico
Case of Study
América I. Zamora-Torres, César Navarro-Chávez, Oscar Hugo Pedraza-Rendón
Insti tuto de Investigacio nes Eco nómicas y Empresariales, U niversidad Michoacana de S an Ni colás de Hidalgo, Morel ia, México.
Email: americazt@ho tmail.com
Received April, 2013
The evolution and grow of international trade has made the ta sk assi gned to cus to ms services more important and com-
plex. No w day’s custo ms adm inistration i s a relevant regulatory operator in international trade as facilitator and accele-
rator of trade. However, the study of efficiency on the public sector is more co mple x tha n t he st ud y of e ffi cie ncy i n t he
private, profit-oriented sector; due to the fact that public sector efficiency can be defined as capacity to achieve goals
instead of perceiving profits. T he aim of this research is to identify those areas which yield the greatest cost/efficiency
gains from the implementatio n of the e-service s ystem Inte rnational Trade Sin gle Window (ITSW) and to note the ob-
stacles or disadvantages present on the implementation of the ITSW in Mexico as a case of study. The findings point
out tha t, acc ordi ng to the first result of t he implementation of the IT SW, Mexico has made good progress related to the
effic iency of i nternational trade procedures, simplifying the flow of information between traders and customs adminis-
tratio n and r educing t he time i n customs clearance in 20%.
Keywords: Efficiency; Cus toms; Public Services; E-System; ITSW; International Trade; Mexico
1. Introduction
In the past twenty years, international trade has growth
twice faster than de GDP. Many economies ensure that
the international trade plays a major role in the economic
growth [1].
Inter natio nal tra de invo lves goo ds crossing borders for
what is required to covert a number of procedures. Some
of these procedures pertain to issues of security and
standards, while others deal with customs. Customs
clearance is a force step on international trade which im-
pacts on a country’s competitiveness that prompted trad-
ers and political leaders to seek out ways to make their
customs o rganizations more effe ctive and efficient.
Ho wever t his i s no t a s imple t ask d ue to the c o nsta ntly
changing and challenging global trade that has become
increasingly difficult of the growing complexities of
trade policy owing to the proliferation of regional and
international agreements, the greater sophistication of
traders, and the multiple and shifting objectives imposed
on customs [2]. On the other hand, the scrutiny upon
gover n me nts ha s d emanded public entities to incre ase t he
efficiency in using t he res ources they manage.
Many countries including Mexico had implemented
the e-s ystem Internatio nal Trade Single Window (IT SW)
in order to improve the efficiency of customs related to
international trade. The single window is defined by the
World Customs Organization (WCO) [3] and World
Trade Organization (WTO) [4] as “a cross-border intel-
ligence facility that allows parties involved in trade and
transport to lodge standardized information and docu-
ments with a single entry point to fulfill all import, ex-
port and transit related regulatory requirements” or “A
platform to allow traders to submit international trade -
import, export or transit- data required by government
departments or agencies once only through a single elec-
tronic interface thereby fulfilling all the regulatory re-
quirements in respect of each transaction”.
The aim of this work is to identify those areas which
yield the greatest cost/efficiency gains from the imple-
mentation of this e-service system and to note the ob-
stacles or disadvantages present on the implementation of
the ITSW in Mexico as a case of study.
2. Customs, Efficiency Concept and
Literature Review
Every organization that want to stand out or survive the
past of the time is looking for be efficient. When we talk
about efficiency different concepts pop out. The effi-
ciency defined as the degree of optimization of the result
obtained in relation with the resources used [5]. Effi-
ciency as the relationship between goods and services
consumed and the goods and services produced; or what
The Impact in Cu s toms Efficiency of the ITSW: Mexico C as e of Study
Copyright © 2013 SciRes. IB
is the same, ser vices provided (o utputs) in relatio n to the
resources used to such an effect (inputs) [6]. Whereas in
the private sector inputs and outputs are expressed in
financial terms, identification of inputs and, especially,
outputs ho wever in the public sector is much more co m-
plex [7].
Observing the public sector, effectiveness, which can
be defined as capacity to achieve goals, gains a greater
importance than efficiency [8]. In the public services
there is no direct correlation between revenues and ex-
penses [9]. The political system is oriented primarily to
the achievement of goals defined in the political process,
regardless of the cost-benefit ratio.
The assessment of the performance of the public sector
has long been a topic of interest to economists, public
administration scholars and management scientists [10]
[11]. Some studies analyzed the productivity of govern-
ment and compared the productivity of whole public
sectors of different countries. That is the case of Afonso,
Schuknecht and Tanzi [12] have carried out an interna-
tional comparison of public sector efficiency based on
the public sector performance (PSP) and efficiency (PSE)
indicators. These indicators comprise a composite and
seven sub-indicators. Four of them are “opportunity’’
sub-indicators that take into account administrative, edu-
cation and health outcomes and the quality of public in-
frastructure and those that support the rule of law and a
level playing-field in a market economy. Three other
indicators reflect the standard “Musgravian’’ tasks for
government: allocation, distribution and stabilization.
After defining indicators, the efficiency is measured via
the non-parametric frontier technique.
Other studies focus on the productivity measurement
in the public sector can also take place at the level of the
organization and from a “bottom up’’ or service-user
perspective [13]. The World Bank has adopted this ap-
proach with regard to assessing some aspects of the ef-
fects of regulation with the development of their Doing
Business database, where three indicators from the data-
base are particularly relevant to the assessment of public
admi ni str a tion quality and productivity.
Relatively to customs administration have being de-
velop some systems to measure efficiency most of them
in Euro pe. The Eur ope an Commi ssion has es tablished it s
Measurement of Results (MoR) project for the customs
services of member states. Work on measuring the results
of customs activities performed by member states is un-
derway and the results achieved enable member states to
compare their performance to the Community standard
and act to improved customs operations where necessary.
A few years ago the role of customs was to be able to
enforce regulation tariffs, non- tariffs and administrative
regulations for all products that enter and leave the coun-
try, respecting international trade agreements [2]. How-
ever, consumers demand has been changing as interna-
tional trade with it. Whereby, customs under this trend
should be facilitators of foreign trade through the tax and
regulato r y simplificatio n.
Overall, the role of the customs service is to be a busi-
ness facilitator, policy adviser and implementer and
safety provider. The proper execution of these functions
can foster a fair market, ensure timely delivery and re-
duce costs of international trade, which leads to the
competitive advantage of firms and nations in the global
value chain [14].
Currently, customs are confronted to a rapidly chang-
ing environment: changing patterns of production and
consumption intensified international trade, new global
threats… In this context, customs play a major role by
ensuring a constant balance between protecting society
and simplifica tion of trade.
Customs efficiency has a significant impact on reduc-
ing cost associated with trade and business performance
management, so a close link between competitiveness in
international tra de and customs ca n be identified [14]. In
the ot her ha nd , a poor function of customs administration
may indeed affect the improvements that have been made
in other areas related to international trade [2].
In such conditions customs administrations, being re-
levant regulatory operators in international trade and
goods movements, accept more important and complex
tasks. To begin with, customs administrations are ex-
pected to facilitate and accelerate international trade and
transport [7].
3. Worldwide International Trade
Single-Window Developments
The ITSW is a concept that has been implemented in a
variety of ways in different countries the past years. His-
torically, the concept of a single-window was developed
by the United Nations Economic Commission for Europe
(UNECE) and countries in other jurisdictions as Korea,
Singapore, Thailand, Chile Japan and Mongolia [15].
The main objective o f the i mplementation of the ITSW
is to achieve trade facilitation or the simplification and
harmonization of international trade procedures.
Governments and the import/export, shipping, logistics
and transport communities have established a range of
agency and country-specific regulatory and operational
requirements for international trade. However, there has
been limited coordination between these groups, both at
the national and the international levels. As a result,
traders are faced with a confusing set of stringent, over-
lapping and onerous reporting requirements, often in-
cluding redundant, repetitive and outdated or superseded
regulations. These requirements come in the guise of
forms, systems, data sets, data models, and electronic
The Impact in Cu s toms Efficiency of the ITSW: Mexico C as e of Study
Copyright © 2013 SciRes. IB
messages, not to mentio n pe rsonal voice co mmunica tions,
and unwritten, informal demands [4].
Governments and trade have to develop and conti-
nuously maintain different systems to meet these myriad
requirements. This adds onerous costs and overhead to
all parties, both in terms of fiscal resources and the time-
liness and accuracy of data. The problem has become
more acute in recent years with the requirements for
faster information delivery, often in advance of shipping,
for security and other purposes, and the expanding re-
quirements of data harmonization in international supply
chains. The ability to handle data efficiently and swiftly
has, in fact, become a key element in international com-
petitiveness, especially in international supply chains
In order to overcome this complex system of data sub-
mission and regulatory control the single-window was
The main goals of the implementation of the ITSW
can be divided according to the international trade actor
as follow [4]:
1) For the government
- More efficient and productive use of resources;
- Enhanced collections of fees, duties and penalties;
- More comprehensive, streamlined and automated
business compliance to Government legislative and
regulatory requirements, including the terms of inter-
national trade tr e a tie s;
- Enhanced risk analysis and management and im-
proved security;
- Reductions in corruption and illegal trade activities,
enhanced transparency and accountability.
2) For the trader
- Cost reductions through minimized clerical efforts,
time taken to reduce and to eliminate delays, and
more predictable, reliable and authoritative decisions;
- Faster goods clearance, exception handling and dis-
pute resolution, leading to reduced inventory holding
- Predictable and reliable consignment clearance and
availability of advanced goods release information;
- Reduction in face-to-face meetings, greater transpa-
rency and reduced opportunities for rent seeking and
3) For the logistic operator
- Faster movement of goods through formalities and
trade junctions, leading to better and more productive
utilization of resources;
- Reliable information on timing of goods movement,
allowing accurate scheduling, allocation of resources
and improved accuracy of information provided to
- More productive and flexible use of human resources;
- The ability to accurately schedule goods collection
and discharge times and locations;
- Better end-to-end audits of operation.
It is worth nothing that every region is looking to
achieve specific goals through the ITSW window for
example, The European Union, is attempting to optimize
the efficiency of border crossings within the European
trading community, while ECOWAS1 is concerned with
controlling smuggling, hijacking and other illegal activi-
ties. ASEAN2 is attempting to introduce efficiencies in
import and exporting between the ten ASEAN countries
by deploying common formatted documents in each
member country. APEC is concerned with the imple-
mentation of a safe and secure supply chain. It includes
the concept of an end-to-end supply chain track and trace
system, to enable regulators to trace dangerous goods
from manufacturer, or source, right through to the ulti-
mate end user [17].
International Trade procedures in México
before ITSW
The real value of ITSW to Mexico can only be judged in
terms of prevailing conditions which are significantly
different to those in other countries where ITSW has de-
livered quantified benefits so it would be unwise to pre-
sume similar gains can be achieved.
Nevertheless the progress made by the customs ad-
ministration is still a big problem the health and security
control and therefore data has to be provided to the au-
thorities, and shipments need to be inspected, as a result
traders have to fill in numerous forms, often duplicated
information sometimes in different formats (see Figure
Nowadays in Mexican international trade are involved
about 30 actors (shipping agents, customs agents, ex-
porters, importers…) which used 40 different documents
along the supply chain, customs, nontariff restrictions
and regulations among others. The customs clearance
process takes at least five days passing by 165 paper-
work’s where are capture around 200 different data that
is capture the 60 a 70 per cent of the times more that
one’s [18].
The Figure 2 shows the permits issued by different
government agencies involved in the process of foreign
4. Expectative of the E-System ITSW
Implementation in México
The main goals pretended with the implementation of
ITSW were the decrease of corruption and fiscal evasion,
improve the logistic process and the legal certainty as to
contribute to a gre e n p lanet.
1Econ om ic Community Of West African States.
Associa tion of Southeas t Asi an Nations.
The Impact in Cu s toms Efficiency of the ITSW: Mexico C as e of Study
Copyright © 2013 SciRes. IB
Figure 1 . International bu siness flowcha r t before ITS W.
Figure 2 . Permits iss ues by gove r nment age ncies.
According to the Doing Business report most of the
delays in the import export process are due to the time
take it in the documents preparation. Until the year 2011
the days take in Mexico to prepare the paperwork were
14 days to exports and 17 days to imports with an aver-
age cost of 1470USD and 2050USD respectively [19].
One of the targets of the implementation of the ITSW in
Mexico was to reduce the delays and costs in these parts
of the process, in order to facilitate and accelerate the
preparation of the governmental paper, and the intercon-
nection between private sector windows (transport ser-
vices and financial entities among others). Therefore one
of the objectives of the implementation of ITSW was to
place Mexico from the 74th at the 54th in the Trade Faci-
litation Wor ld Bank Index [18].
The estimated time that used to took past through the
customs inspection was around 165 minutes. The time of
customs insp ectio n is pretended to be reduce in an 11.3%
as a result of the recognition at the time of the verifica-
tion in a mobile device [18 ].
As results of the time reduction in recognition the
transport operations could increase by 50% and the
process of clearance of good reduce in 80% (1 day). The
achievement of these obje ctives leads to the opti mization
of human resources at customs administration in 21%
which represents about the $12 19 806 USD [18].
5. First R esults
Even so many countri es had implement the I TSW the l ast
few years Mexico has only one year past since the im-
plementation o f t his e-system in 2012.
The ITSM phases of implementation were:
(a) The technology of a single point of access that
could facilitate communications between a community of
other systems, but users must have dedicated access
points, just li ke ac c e ss to a n email service provider;
(b) The use of a single user ID and password sign on.
(c) The single submission of data so that no matter
who and how many different users make use of the orig-
inally submitted data, it only has to be entered into the
system by one nominated user; preventing duplica- tion,
several types of error and transcription mistakes, multiple
conflicting versions of information and associ- ated mis-
(d) Point of decision-making allowing that each sign-
on enables the user to apply for, and receive, licenses and
permits, to make, and obtain approval for, customs dec-
larations, to track and trace consignment progress and
location, estimate time for goods arrival and availability
for collection, to book and confirm transport and to ob-
tain goods release…
(e) A gateway to online banking facilities, operating
all around the clock with a real time confirmation of
transaction payments by the implementation of a single
point of payment of any service related to the export/
import procedures such as customs, the port, shippers,
the container handler, transport, freight forwarders, cus-
toms brokers and a range of messengers and intermedi-
aries all have to be paid at some stage b y cargo importers
and exporters (see Figure 3).
From June 1st 2012 to January 30th 2013 were per-
formed 7.7 millions of operations through the ITSW.
In the ITSW are register the 96.4% of the import reg-
ister (70 000 records approx.).
The first results shows that with the ITSW implemen-
tation the time in customs clearance procedures decrease
in 20%, even when hasn’t been completed the digitiza-
tion process of the import/export proceedings.
Figure 3 . ITSW inter national b usi ness flowchart.
The Impact in Cu s toms Efficiency of the ITSW: Mexico C as e of Study
Copyright © 2013 SciRes. IB
The time that take past through the customs inspection
decrease in 30 minutes that represent a 20% least than
before the i mple mentatio n of ITSW . Also where simplify
40 documents, 165 paperwork’s and 200 different data.
Nevertheless not all businesses involved in Interna-
tional trade benefit equally from the ITSW, for those
business already moving free circulation goods within
the NAFTA or under the frame of an international trade
sign by Mexico that allows these movements the imme-
diate significance of the ITSW is minimal; given that
some goods are more controlled than others; so there is a
correlation between the benefits of ITSW to the trader
and the complexity o f the existing proc edur es.
Another aspect to consider is the implementation cost
for micro and small business that according to Jaso [20]
oscill ate a round 7t housa nd do llar s due t o t he nec essi ty o f
acquire the computer equipment, internet networks and
the training in order to be part of the e-syst em.
Regarding to the legal frame one of the major prob-
lems t hat had to be faced in order to implement ITSW in
Mexico case was the necessity of restructures some leg-
islation and rules concerning to the use of electronic sig-
nature, elimination of requirements, electronic notifica-
tions, legal representatives, shareholders among others.
6. Conclusions
Any conclusion derivate from this first analysis is only
preliminary because the implementation of the program
is quit e rece nt and it has to be meas ure b y the test of the
time and the unexpected task that will show up. Despite
of these remarks the initials conclusions are that Mexico
has made good progress related to the efficiency of in-
ternational trade procedures simplify the flow of infor-
mation between traders and government and reducing the
time in customs clearance (20% decrease).
It is important to point out that even so these ITSW
e-system has been implemented on a number of countries
the variation between conditions in individual countries
makes difficult and complex to defined the efficiency of
the program as a result of the financial and resources
capacities, the current legal codes, business practices,
trade patterns and needs, the size of the economy, geo-
graphical factors, stability… that makes relevant the
study of individual cases.
7. Discussion
At the beginning of this study it was considered that the
most significant measure of the benefit of an ITSW
would probably be in its potential for harmonizing the
provision of data and eliminating duplication. Neverthe-
less the savings in time and money in this area for the
trader and the customs administration (and any other
government agency involved in the process) must be
added significant in terms of the most efficient operation
of its control agencies through sharing information and
co-ordinating activities which allows the goods move-
ment through the various control system with greater
speed and transparency.
Even the functionality of the e-system there are still
some prob lems with the imple mentation of the o peratio n,
particularly with the micro and small companies who are
entering to the global markets and cannot face the cost of
ITSW. These rai se the question abo ut the marginalizatio n
of the benefits of the ITSW and the possible enlargement
of the disparity of economic g rowth.
8. Acknowledgements
Professor América I. Zamora Torres shows gratitude for
the financial support from the National Council for Sci-
ence and Technology (Consejo Nacional de Ciencia y
Tecnología, CONACYT) in Mexico. The usual caveats
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