Finance Minister Pravin Gordhan. Picture: TREVOR SAMSON
Finance Minister Pravin Gordhan. Picture: TREVOR SAMSON

THE customs modernisation programme on which the South African Revenue Service (SARS) embarked in 2009 was the main reason South Africa’s international rankings for the ease of cross-border trade had improved, Finance Minister Pravin Gordhan said on Friday.

The World Bank’s 2012 Ease of Doing Business report, released last month, showed that South Africa had gained one position to rank 35th among 185 countries after it improved in three categories. In 2011, South Africa improved in six categories compared with the previous year but also fell in three.

Mr Gordhan said in a written reply to a parliamentary question that SARS’ customs modernisation programme had had a "significant impact" on trade facilitation for legitimate goods.

Mr Gordhan quoted from the World Bank’s Doing Business 2013 report: "In 2011-12, South Africa improved the most in the ease of trading across borders as measured by Doing Business. Through its customs modernisation programme it implemented measures that reduced the time, cost and documents required for international trade. Improvements in South Africa have effects throughout Southern Africa. Since overseas goods to and from Botswana, Lesotho, Swaziland and Zimbabwe transit through South Africa, traders in these economies are also enjoying the benefits."

The World Bank report noted that, overall, South Africa improved the average time taken to import goods from 32 days last year to 23 days this year, with significant improvements in document preparation and customs clearance.

Mr Gordhan said the introduction of improved risk analysis as part of the customs modernisation programme since 2009 had provided more accurate targeting of illicit goods. In the 2011-12 financial year, the accuracy of audits improved, with a 59% success rate achieved on invalid tariff or valuations and a 57% success rate on customs storage and manufacturing warehouse audits.

The successful intervention in illicit trade last year resulted in a total of more than 25,000 seizures with a value of R2.6bn, including more than 75,000 master cases of illicit cigarettes worth almost R280m; nearly 3,000 narcotics seizures worth R200m; 35 seizures of protected wildlife products such as rhino horn worth almost R60m; and more than 7-million items of clothing and textiles worth more than R1bn.

Mr Gordhan gave examples of the methods used by traffickers to conceal their illicit goods: by soaking their clothes with liquid cocaine, hiding cigarettes in false compartments of vehicles and concealing cocaine in a laptop. He cited the example of a male passenger on a flight from Buenos Aires whose luggage contained a black rubbery substance known as black cocaine.