The Grenada Technical Assistance Credit (GDTAC) Project is one of the Doing Business Reform activities aimed towards supporting the Government of Grenada in improving the environment for private sector led growth through the modernization of key public sector institutions and the implementation of an export strategy.
The Government of Grenada has entered into a Financing Agreement with the International Development Association (IDA) and the European Union. The proceeds of this have been allocated towards the financing of the Grenada Technical Assistance Credit Project.
PROJECT COMPONENTS AND OBJECTIVES
1. Customs Modernization
The objective of this component is to improve the efficiency and effectiveness of Customs through modernizing the administration. To achieve the overall objective, the technical assistance focuses on: (a) improving customs systems and procedures; (b) upgrading information technology; and (c) capacity building of management and staff in Customs through technical and customer service training.
The improvement of the Customs systems and procedures including the strengthening of the risk management and enforcement systems in Customs is critical to reducing the time taken for the clearance of exports and imports while minimizing the leakage of revenues.
The ASYCUDA system at Customs is now being upgraded from ASYCUDA 2.7 to ASYCUDA World, the latest version. Upgrading to ASYCUDA world will improve efficiency and reduce the time for processing imports and exports, and support the re-engineering of the front end customs processes in accordance with best practice. This new version of ASYCUDA will also support e-commerce and provide the capability for better management reports from Customs. The updated version of ASYCUDA will also facilitate data integration with the SIGTAS system used by the Inland Revenue Department (IRD) and with the Central Statistical Office’s data system.
The upgrading of the information technology, the re-engineering of the processes within Customs will require training for customs officers and administrative staff at all levels. This will ensure that the capacity exists to access management information as well as to manage and maintain the new system. The training will build on the principle of training of trainers.
2. Tax Administration Modernization
The objective of this component is to modernize critical areas of tax administration to increase the overall efficiency and effectiveness of tax administration and decrease the transaction cost of paying taxes and thus increase the level of tax compliance. The technical assistance will focus on: (i) improving tax compliance; (ii) strengthening tax enforcement and control; (iii) establishing a tax policy planning and monitoring unit; and (iv) upgrading information technology in the Inland Revenue Department.
Improving tax compliance is a key element of the reform process. This component will focus on (i) improving the registration process; (ii) cleaning-up of the taxpayer registry; (iii) strengthening the detection of non-registered taxpayers; (iv) improving taxpayer services; and (v) examining the feasibility of using Tax Compliance Certificates.
The sub-component on tax enforcement and control will address the collection of arrears, review the procedures for dealing with arrears and clean up the inventory including ensuring that the arrears data is up to date. This sub-component will also ensure that the upgrade of the information system adequately covers the debt management module and includes risk management modules with cross-checking features for VAT and other taxes.
The upgrade of the information system (SIGTAS) will allow for the development and documentation of full audit procedures and the training of audit staff will also be covered under this sub-component. Specifically the objectives of SIGTAS upgrade are as follows:
• To strengthen the Audit function
• To improve tax payers survey, registration, assessment and collection capabilities in SIGTAS
• To improve the system’s management reporting capabilities in specific areas; and
• To transfer knowledge to IRD personnel with respect to the system’s upgraded modules
This sub-component will also finance activities for the establishment of a small but effective tax policy planning and monitoring unit in order to give greater priority to planning and monitoring.
3. Modernization of Investment Promotion
The objective of this component is to modernize investment promotion in Grenada through the strengthening of the strategic and institutional environment for attracting investment into Grenada. This will involve working with the Grenada Industrial Development Corporation (GIDC) to build on and complement work done in the context of the Public Sector Modernization Project to strengthen the Small Business Development Centre of the GIDC. The sub-components will include: (i) the preparation of an Investment Promotion Strategy; (ii) implementation of the Investment Promotion Strategy for Grenada; and (iii) establishment of an Investment Facilitation Network, including the conduct of an Institutional Study of the GIDC and other Government agencies involved in the approval of new investments, the development and installation of an integrated IT system to make communication and processing of applications more transparent and straightforward and the development of a website dedicated to investment promotion and facilitation.
4. Implementation of Export Strategy
This component focuses on two priority activities to support the implementation of the comprehensive export strategy that was developed in August 2006 with assistance from the International Trade Centre and the Commonwealth Secretariat.
The first sub-component, Improving Access to Trade Information will finance activities for the establishment of a trade information network in key public and private sector agencies that would provide timely information on new trade opportunities, markets, and products and link up potential exporters with markets.
The second sub-component Strengthening the Bureau of Standards focuses on building the capacity in certification and testing toward strengthening the Conformity Assessment System of the Grenada Bureau of Standards to facilitate trade and increase competitiveness.
ACHIEVEMENTS OF THE GDTAC PROJECT BY COMPONENTS
• Development of the ASYCUDA World Prototype for Grenada Customs and Excise Department. This prototype was developed by the Project Team with technical assistance provided by UNCTAD. The project team comprises seven Customs Officers.
• Development of a user manual for electronic manifest creation. This will be used by Shippers and Traders and other key stakeholders involved in the import of goods.
• Several public awareness efforts have been conducted via television and radio to sensitize the public of the ASYCUDA World Project.
• The Customs & Excise Department successfully launched the electronic cargo manifest module of ASYCUDA World on 27th July 2011. The Department continues to sensitize the public by promoting and bringing about further awareness of this new achievement.
• Began training of Customs Officers and other stakeholders in preparation of the roll-out of the Declaration Module of ASYCUDA World, planned for January 2012.
• Began the procurement process for the selection of a suitable Consultant to provide expertise to develop a Post Clearance Audit Unit and provide required training to appropriate staff.
• Began procurement process for the selection of a suitable Consultant to provide training in the area of Customer Service.
• Successful hiring of a Consultant to develop and guide implementation of an Investment promotion Strategy for Grenada.
• Productive and effective brainstorming sessions held with key stakeholders as it pertains to the development of the Investment Promotion Strategy
• An Investment Promotion Strategy was developed following the development of an Investment Promotion Strategy Framework. This process was done in tandem with several consultations and exchanges with stakeholders.
• Following the development of the strategic framework, the Investment and Promotion Strategy was completed and presented to various stakeholders and Cabinet for review and approval. The Investment Strategy was approved and adopted by Cabinet in August, 2011.
• An Investment Facilitation Manual was developed and approved by Cabinet. This Manual provides information on the number of days to process incentives at the respective agencies as well as process maps.
Implementation of an Export Strategy
• Successful procurement of equipment for upgrading and enhancing testing and certification capabilities at the Grenada Bureau of Standards. Equipment for the Materials Testing, Metrology and Microbiology Laboratories has already been procured and are at the Bureau. Installation and commissioning of said equipment began in June, 2011 and was completed in November with the commissioning of a Gas Chromatography/ Mass Spectrometer within the Microbiology Laboratory. The cost of equipment purchased is EC$790,000.00.
• Began the procurement process for hiring a suitable firm to design and develop a trade information portal.
• A suitable Consultant was selected to provide consultancy for Conformity Assessment in the Microbiology Laboratory at The Grenada Bureau of Standards. This consultancy was successfully conducted in October, 2011.
• A suitable Consultant has been selected to provide expertise on Quality Management and to provide required training to appropriate staff at the Grenada Bureau of standards. This consultancy began in November, 2011 and will be completed in December, 2011.
• The Firm CARIRI based in Trinidad was contracted to provide training for staff of the Materials Testing Laboratory at the Bureau of Standards. The training was successfully conducted in September, 2011.
Tax Administration Modernization
• A consultant was contracted to Review the Organizational and Management Structure at the Inland Revenue Department. This consultancy was successfully completed in October, 2011.
• A Consultant has been selected to establish a planning and monitoring unit at the Inland Revenue Department. This consultancy began in October, 2011 and is expected to be completed in April, 2012.
• The upgrade of SIGTAS is planned to begin in January 2012, and will be done by CRC Sogema, the designer and developer of this administration system.
Establishment of Baselines Monitoring and Evaluation
Successful completion of baseline surveys to determine the following:
• To determine clients’ perception of operations and customer service at the Customs and Excise Department.
• To determine clients’/ tax payers’ perception of service quality and tax administration at the Inland Revenue Division.
• To evaluate how easy it is for exporters and potential exporters to find information on trade and export.
• To determine the quality of service delivered by the Customs Department.
• To evaluate investors’ and potential investors’ perception of the quality of service delivered by the Grenada Industrial Development corporation