The Colombian government is to push forward a major customs modernisation project to boost cross-border trade, with an initial focus on the country’s automotive industry.

Colombia’s national directorate of taxes and customs (DIAN) has signed an agreement with the Global Alliance for Trade Facilitation (GATF) to implement the measures, which will reduce border waiting times and trading costs for importers and exporters.

The project will see the establishment of a new centre for trade facilitation and best practices run by DIAN and a team with specialised knowledge and understanding of the needs of vehicle assembly companies and exporters. It will issue advance rulings on the classification, valuation and origin of goods prior to their arrival at borders, which are expected to significantly shrink queues at customs.

Colombia’s automotive industry is one of the largest in South America next to Brazil and Argentina, according to the US international trade administration. It focuses largely on auto parts manufacturing and assembly of light vehicles, trucks, buses and motorcycles and is an industry ripe for foreign trade: according to the Colombian government the country registered a new record in sales, surpassing 328,000 units in 2014, a 12% increase compared to 2013. 34% of these sales were locally-assembled vehicles.

Among the groups which have been involved in developing the project are Andemos, the Colombian motor vehicles association representing the interests of both domestic importers and motor vehicles assemblers together with its member companies, Andi, the national association of business, and Acolfa, the Colombian association of auto parts manufacturers, a GATF spokesperson tells GTR.

GATF, a public-private group jointly led by the International Chamber of Commerce, the World Economic Forum and the Centre for International Private Enterprise, helps businesses and governments in developing countries form partnerships to reduce barriers to trade.

Jose Raul Perales, deputy director of GATF, says the new centre in Colombia is “an example of a modern customs system where both the government and the private sector benefit”.

According to the GATF spokesperson, the alliance is funded by donor governments: US, Canada, the UK, Australia and Germany, together with support from the private sector.

“We estimate that 25% of this project will be covered by private sector in-kind contributions,” the spokesperson adds.

The agreement brings Colombia into the World Trade Organisation’s trade facilitation agreement, a plan to remove barriers to trade signed by WTO members which came into force in February 2017.