The United States (US)-Association of Southeast Asian Nations (ASEAN) Business Council Inc. (USABC) is urging Southeast Asian governments to accelerate customs digitalization, harmonize trade procedures, strengthen anti-illicit trade enforcement, and deepen public-private cooperation to bolster regional supply chains amid mounting geopolitical and economic risks.

In a May 27 report titled “Advancing ASEAN Customs Modernization, Enforcement Cooperation, and Public-Private Cooperation for a Resilient and Connected Region,” USABC outlined recommendations for the 35th ASEAN Directors-General of Customs Meeting aimed at improving trade facilitation, customs modernization, and regional economic integration.

The USABC report, authored by Angelica Ortega, Cath Salazar, and Handy Santoso, said ASEAN should prioritize modernization, simplification, and harmonization of customs procedures by advancing digitalization and paperless trade, streamlining customs processes across member states, modernizing procedures for e-commerce and express delivery, and strengthening trusted trade programs.

Among its key recommendations, USABC called for expanding the ASEAN single window (ASW) to cover additional customs, regulatory, and commercial documents to facilitate seamless cross-border data exchange and move the region toward fully paperless trade. It also proposed a region-wide roadmap with measurable milestones for paperless customs processes.

USABC also recommended greater use of automation, artificial intelligence (AI), and application programming interface (API)-based connectivity to improve compliance verification, customs audits, and risk detection.

To reduce compliance costs and shipment delays, USABC urged ASEAN member states to adopt a “once-only” submission principle that would allow traders to submit standardized data only once for reuse across agencies and borders. It also called for greater alignment in customs procedures, tariff classifications, rules of origin, and documentation requirements across the region.

The report said ASEAN faces a more challenging trade environment marked by geopolitical tensions, supply-chain disruptions, rising logistics costs, and shifting trade policies. It said the 2026 conflict in the Middle East has contributed to volatility in energy markets, shipping routes, and logistics costs, while trade fragmentation and tariff uncertainty continue to increase compliance burdens for businesses.

According to the report, disruptions through the Strait of Hormuz—which handles about 20 percent of global oil flows and a significant share of liquefied natural gas shipments—have heightened pressure on supply chains and transportation costs.

USABC said these external conditions underscore the need for resilient and diversified supply chains as well as customs systems that are efficient, responsive, and capable of supporting increasingly complex trade flows.

The report identified several key trends shaping the regional trade landscape, including ASEAN’s growing role as a manufacturing and supply-chain diversification hub, rapid growth in cross-border e-commerce and express delivery services, and rising investments in digital supply-chain systems and automation technologies.

Also, USABC cited persistent challenges such as fragmented customs procedures, inconsistent application of tariff classifications and rules of origin, documentation differences among member states, and growing risks from illicit trade and counterfeiting. These issues increase compliance costs, delay shipments, undermine revenue collection, and distort fair competition, the report said.

To address these concerns, USABC called for stronger regional cooperation against illicit trade through enhanced intelligence sharing, AI-driven risk profiling, digital track-and-trace systems, and closer coordination among customs authorities and other enforcement agencies.

USABC also recommended designating high-risk goods—including worker safety products and excisable goods such as tobacco—as priority enforcement areas in 2026, while strengthening efforts against counterfeit goods and intellectual property rights (IPRs) violations.

The report urged ASEAN to strengthen public-private collaboration to support implementation of the Strategic Plan of Customs Development (SPCD) 2026-2030 through workshops, training programs, technical exchanges, pilot initiatives, and other capacity-building activities involving both customs authorities and industry stakeholders.

“Customs reform is not merely an operational necessity but it is a strategic imperative for ASEAN’s continued growth and integration into global value chains,” USABC said. “A coordinated, forward-looking approach to modernization, enforcement, and partnership will be key to reinforcing ASEAN’s position as a competitive, trusted, and resilient player in the global trading system.”