Artificial Intelligence as a Force Multiplier in Customs and Global Trade

Sania Rasool Bhutto, (Assistant Collector, Pakistan Customs Service)

Artificial Intelligence (AI) has emerged as a force multiplier and is predicted to transform the potential of GDP growth in the global economy exponentially. According to Forbes, AI market size is expected to reach $407b by 2027; assisting the human race in addressing challenges, strained resources and potential vulnerabilities smartly.

AI, as a technological marvel, has timely permeated into Customs to offer AI-based solutions for supporting international trade, trade partners, customs operations and fostering an environment of compliance in the present day globalized society.

Customs authorities across the world have shown increasing interest into incorporating artificial intelligence in customs processes for obtaining better efficiency and trade facilitation with pivotal role of focusing on providing traders with convenient, smart and smooth experiences as it allows intelligent data capture, drive insights, accord precise decision making and provide better business impacts.

Trade facilitation through AI-based tools can garner a conducive and clutter-free trade environment through AI-based customer care services and virtual assistants thereby eliminating the need for manual human interventions.

Moreover, AI-based predictive analytics can help in smart past trade data analysis, intelligent assessment of market and other external factors coupled with better throughputs so that customs authorities are empowered to precisely estimate trade volumes, identify potential system vulnerabilities and delays, mobilize and maximize revenue collection and optimize resources allocation and usage.

Similarly, AI-based cargo-scanning through AI-trained computer vision algorithms can detect potential risky goods and contrabands in scanned images leading to increasing the level of security and efficiency of scanning without human involvement.

Recently, China Customs and Tsinghua University jointly conducted a real time test on 1,182 types of goods using AI-based NII (Non-intrusive inspection) system and it successfully detected 49 restricted and contraband goods.

In addition to, natural language algorithms are also in place to identify possible documentation concerns such as under-invoicing for effective trade documentation and regulatory compliance.

Also, AI-based risk assessment using machine learning techniques to identify risk indicators through AI-based profiling for detection of irregularities can optimize the customs risk assessment and enrich customs processes with better performance and throughputs.

In a recent paper published jointly by the World Trade Organization (WTO) and the World Customs Organization (WCO) titled “The role of advanced technologies in cross border trade: A customs perspective”, it was stated that “Around half of customs authorities use some combination of big data analytics, AI and machine learning, while the other half plans to do so in future”.

Adopting the best practices in close coordination with the WCO (World Customs Organization), Pakistan Customs has also deployed Artificial Intelligence and machine learning algorithms in its customs clearance system (WEBOC).

As of 2022, more than 50% of the import consignments and majority of export consignments were subjected to post-clearance audits after clearances.

Other AI-based projects of Pakistan Customs include pre-arrival clearances at ports, clearances in the sky and profiling of the cargo under blue channel with IREE (Import Risk Evaluation Engine) as a predictive analysis algorithm based on machine language which is incorporated in RMS to selectively target risky cargo subsequently increasing the green channel clearances by 9% in FY2021-22 as compared to the previous year.

These AI-based systems are rapidly evolving and transforming the role of Pakistan Customs in trade facilitation to ensure better data governance and management, enhanced trade performance and improved quality of service thereby reducing cost of doing business and system bottlenecks.

Copyright Business Recorder, 2024