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Cambodian Officials Learn New Approaches to Transposition

27 July 2021

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Jakarta, 12 July 2021: The World Customs Organisation (WCO) updates the Harmonised System (HS) of tariff descriptions and classification around once in five years. As the HS system changes, ASEAN must revise the ASEAN Harmonized Tariff Nomenclature (AHTN) to be consistent with the revised HS codes. The transposition process is complicated as from one classification to the next, tariff lines may merge. This has policy implications as it results in new tariff rates for imports. However, how this process is managed is dependent upon the methodology used to apply the transposition.

ERIA’s Capacity Building Programme held a four-day online training and discussion around the Transposition of Tariff Commitment from ASEAN Harmonized Tariff Nomenclature (AHTN) 2012 into 2017. The training, co-hosted with the Ministry of Commerce of Cambodia, was held virtually on 1-2 July and 6-7 July 2021. The objective of this training was to explain the transposition process and practice the application of the methodology to an actual free trade agreement.

Mr Ahmad Syaukat Romawi, a former ASEAN Secretariat official and renowned expert on this topic, facilitated the training. Twenty-four government officials from different ministries participated in this training, with the majority coming from the  Ministry Economic and Finance and General Department of Customs and Excise.

Under Secretary of State, HE BUN Chanthy, Ministry of Commerce, Kingdom of Cambodia, delivered opening remarks, noting the importance of the training to enhance the skills of officials in ensuring tariff commitments are in line with the Harmonised System of Tariff Nomenclature, to support Cambodian trade negotiations. As ERIA’s Capacity Building Program is supported by the Australian Government, Mr Anthony Samson, Second Secretary, Australian Embassy in Cambodia, in his opening comments highlighted the importance of this training to provide Cambodian officials with the knowledge to classify tariff rates for importing goods which simultaneously provide traders with predictability and security. He also added that understanding the methodology would be beneficial to leverage Cambodia as a key player in ASEAN Free Trade Agreements. Mr Jeremy Gross, ERIA Director of Capacity Building, in his opening comments, highlighted ERIA’s commitment to support Cambodian government officials through its mandate to support ASEAN regional trade facilitation.

On the first two days of the training, Mr Ahmad Syaukat Romawi explained his approach by transposing the RCEP Tariff Reduction Schedule from 2012 into the Modified AHTN Correlation Table 2017. For the remainder of the training, Mr Ahmad Syaukat looked at the options arising from the WTO methodology for applying tariff rates for merging tariff lines with different tariff rates. Participants had the opportunity to discuss transposition and ask questions on issues including the merging and calculating of tariffs, the strategic policy approach for transposition, and transposition guidelines.  

Feedback from the participants about the training was very positive, with participants pointing out some of the issues they learned. These issues included how to construct and use Excel formulae to support transposition, how this approach would expedite the work of tariff transposition, and the need to link transposition to policy decisions.

In closing, Mr Uy Rithimony, Director of  Economic Integration and ASEAN Department, Ministry of Economy and Finance,  stated the importance of this workshop is not only improving knowledge and capacity of the officials, but also for supporting Cambodia for RCEP implementation and the process of tariff reduction and transposition.

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