THE WORLD BANK has approved a loan worth $88.28 million (P4.3 billion) for the modernization of the Bureau of Customs (BoC), a project which hopes to automate the agency’s processes and lower trade costs.

In a statement Wednesday, the bank said its board of executive directors approved the loan for the Philippines Customs Modernization Project.

The bank said the program is expected to benefit traders, exporters, importers, port operators, shipping companies and transport providers.

“Improved efficiency at the Bureau of Customs will reduce trade costs and support the Philippines’ competitiveness. Automation will reduce face-to-face interactions and delays, and increase accountability, all of which strengthens efficiency and improves the business environment,” Ndiamé Diop, World Bank’s country director for Brunei, Malaysia, Thailand, and the Philippines, was quoted as saying.

The loan will also fund the development of a new customs processing system that is at par with global standards. The planned upgrade will integrate key processes such as trade management and registration, cargo inspection, duty payment, and clearance and release of items across a single, seamless online system.

It said the bank will support the bureau in fast-tracking its reforms that will enhance its trade processes through digitalization of its existing paper-based systems, and improve key roles such as risk management, intelligence, post clearance audit, and other transaction processes that have been prone to corruption.

The BoC said in a separate statement the loan will also support its Administrative Back-Office Enterprise Resource Planning, which will streamline its technology, services, and human resources support functions.

“Relatively poor trade facilitation performance at the country’s borders can partly be attributed to outdated infrastructure and business practices,” the World Bank said.

It said a container in the country takes 120 hours on average to clear customs and other inspections, which was way longer than those recorded in some of its regional peers such as Vietnam, Thailand, or Malaysia.

“The unfavorable business environment for firms in the Philippines reduces the incentive to engage in export, thereby foregoing the opportunity to expand markets and create more jobs in the Philippines,” it said.

The Customs modernization program is valued at P5.45 billion. — Beatrice M. Laforga