Impact of RFID Technology on Tracking of Export ... - Semantic Scholar

Impact of RFID Technology on Tracking of Export Goods in Kenya Joseph K. Siror1,Liang Guangun, Pang Kaifang, Sheng Huanye, Wang Dong

Impact of RFID Technology on Tracking of Export Goods in Kenya Joseph K. Siror*,Liang Guangun, Pang Kaifang, Sheng Huanye, Wang Dong Computer Science & Engineering, Shanghai Jiao Tong University, 800 Dongchuan Road, Shanghai, 200240 China [email protected], [email protected], [email protected], [email protected], [email protected] doi:10.4156/jcit.vol5. issue9.19

Abstract In this paper the impact of RFID based tracking to address the challenges of diversion of export goods into the local market in Kenya is discussed. Goods would be moved out of the export factories on pretext that it was destined to foreign markets, however, along the way the goods would be dumped and documents falsified to indicate that goods had left the country, thus evading taxes and gaining unfair advantage. An RFID based In-Transit Visibility system was designed and piloted to address the challenges. The system was used to track export cargo from the factories to the port or frontier offices. The system design, workings and pilot results are discussed in this paper. Results from the pilot demonstrated that RFID based tracking has a great impact on curbing diversion and considerable benefits to transporters and other stakeholders through increased efficiency and reduced turn-around time.

Keywords: RFID, Container Tracking, In-Transit Visibility, Real Time Location Tracking,Cargo Security,Intelligent Tracking

1. Introduction Export products from Kenya enjoy privileged status on taxation and excise duties with most exempted. Taxes and duties are usually paid by manufacturers upon selling the goods. Refund claims are then processed by the tax authority upon proof of export from the traders. Unscrupulous traders however misuse the provision by making fake claims. Goods would be loaded and leave their factories with documents indicating that the goods are destined to foreign markets, but along the way the goods are diverted and dumped to the local market. Additionally, they would thereafter lodge refunds claims for the same cargo on pretext that they were exported. Other traders exaggerate what is exported to facilitate diversion of the cargo difference to the domestic markets. While some would dump the cargo, others however exchange the original contents for prohibited or illegal goods such as narcotics to facilitate transiting to other destinations. This is done due to weaknesses in tracking or bribery of those responsible for escorting or verifying the export cargo. According to UN’s International Narcotics Control Board (INCB), Kenya is an emerging transit area for narcotics where they arrive, are repackaged and exported to Europe disguised as legitimate cargo [1-2]. Export cargo is carried mainly by trucks with full covered bodies, tankers and containers on trailers or on rail. Manual seals are used to secure the doors, valves or hatches prior to departure to the port or frontier office. Upon the cargo crossing the frontier office or the port with intact seals; the cargo is assumed not to have been tampered with. High risk cargo is additionally physically escorted by customs officers. Use of mechanical security seals and physical escorts has however not been effective in curbing diversion of goods. Instances of seals being broken, goods dumped or exchanged and a substitute imitation seal fixed abound. The high levels of taxation, collusion by law enforcement agents, particularly at border points or the port, increasing volumes of trade, inadequate physical and technological infrastructure, vast distances traversed by cargo trucks, need to facilitate faster movement of cargo have created a conducive environment for these practices. Thus, despite the measures, large quantities of export goods still get diverted to the local market with most undetected. These challenges impact negatively on revenue *

Corresponding Author E-mail: [email protected]

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collections, confidence in customs controls, costs of controlling revenue leakages, security and cost of doing business in the region and increased risk of export goods from the region.

2. Related Works Awareness about vulnerability to terrorist attack on all modes of transportation has become a worldwide security concern [3-5]. Vulnerability to freight-oriented terrorism is multi-faceted, reflecting the diversity, ubiquity, and openness of freight transportation systems availing terrorists an immense array of choices. Freight systems were designed for business and financial gains and not for security. Terrorism has thus presented opportunities for technology development and research to provide tools, technologies, and processes capable of addressing these complex challenges [6-8]. Global supply chains are hyper-connected models of efficiency and risk. The global import/export market exceeds US$6 trillion, with 15 million containers continually being transported on 46,000 vessels through 4,000 global ports and with over 200 million container movements per year. Each link and node in the supply chain is subject to a variety of threats such as from fraud to terrorism. Among them are estimated 20-plus freighters owned or controlled by al Qaeda [9]. One of the technologies that can be considered for enhanced cargo security so as to minimize these risks is Radio frequency Identification (RFID). Radio Frequency Identification (RFID) system is a technology that has revolutionized automatic identification and data capture technologies. The system comprises two separate components, namely a transponder or tag usually located on the item to be identified or tracked and an interrogator or reader [10]. RFID uses radio frequency waves to transfer data between a reader and an item that is to be identified, tracked, or located [11]. RFID systems are non-contact and do not require line-of-sight to work and can thus be used in visually and environmentally challenging conditions [12]. RFID technology is one of the pivotal enablers of the ‘Internet of Things’ [13-14]. RFID tags fall into two main categories; Active and Passive. Passive tags do not contain a battery or power source. Active tags have internal batteries and can thus work for longer distances as they do not depend on near field or the interrogator to transmit or receive [15]. RFID systems mostly utilize Low Frequency (LF) at 125–134 KHz, High Frequency (HF) at 13.56 MHz, and Ultra High Frequency at 433 MHz and 860 to 930 MHz and more recently Microwave Frequencies at 2.45 GHz. RFID has been used to make Electronic Seals aimed at replacing manual seals for securing cargo but offer better security features. Electronic Seals are thus replacing the traditional manual seals. Electronic seals tend to combine physical seals and RFID components. Most of the electronics include passive or active RFID technologies. Passive seals are short range, low cost, and disposable. Active seals are more sophisticated have internal batteries and thus has longer range and greater functionality. They can detect tampering when it occurs and a time log of events [16]. Studies on the features and evaluation of Electronic Seals concluded that the overall product is relatively mature and that RFID based electronic seals may uphold the function of inert seals in everyday application [17-18]. RFID has enabled the organization of manufacturing and logistics activities in radically innovative manners where its use is growing rapidly as costs come down and benefits are widely recognized [1925]. RFID has been identified as the technology that will help achieve supply chain efficiency and success and provide a major transformation in the supply chain through automatic identification [26-27]. A study by Jedermann et al predicted that use of RFID-Tags on transport items will be standard in logistics of the future [28], the study was however focused on how to combine sensor networks, RFID and software agents. Application of RFID technology to improve efficiency of port operations has also been reported [29-30]. A study done at a Hong Kong based container depot showed that the usage of RFID enhanced efficiency and provided better customer services while lowering the cost of service provision [31]. Both studies were however focused on use of RFID in m-commerce activities and particularly automated identification and data capture and inventory location tracking. Hsu et al [32] reported that customs clearance processes were markedly improved by use of RFID technology, the mathematical simulation was done based on an Taiwan Air Cargo Terminal (TACT), where realizable benefits were reduction in shippers inventory cost and operators labor cost. Findings of a study undertaken in a Taiwan port [33] indicate that computer-based container tracking system was found to be more effective than physical escorts in smuggling prevention. The system was however based on tracking the truck and its location without mechanisms for checking cargo status. Commello also discusses the benefits of RFID and chokepoint based tracking system for tracking re-usable containers.

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The benefits according to a study conducted in a manufacturing industry revealed that lost containers could be reduced by 3%, container search times by up-to 75%, reduction of strays and errors by 95%, fewer production downtimes due to lack of containers and an increase in container circulation rate by 5%. A separate study undertaken by the same author revealed that 60% savings could be achieved by use of the solution and Return On Investment (ROI) of 10.4 months achieved. Despite the high savings achieved, the solution was however not focused on security of the cargo but automated identification and data capture. Literature is thus available on Electronic Seals and the use of RFID in supply chain, ports, depots and container terminals for automated identification and data capture with the aims of m-commerce, increasing efficiency, elimination of manual labor, and for better inventory management. However, there is little literature available on secure tracking of cargo, its impact, weaknesses and benefits, and particularly for customs purposes. Most have reported on the use of RFID technology in tracking of goods with emphasis to ordinary supply chain processes. While for ordinary supply chain and logistics processes the goal is to facilitate movement of goods from the supplier to the buyer with automated identification and capture to reduce errors, delays and labor costs, this is not the case for customs administrations. The main aim of tracking for customs is for enforcement of policies relating to security and tax collection where the risk emanates from all the players including customs officers. In their security role, they are required to vet the goods that enter or exit their administration so as to prevent usage of the supply chain for criminal or terrorist activities. Additionally, they are required to ensure that taxes and duties have been paid for the goods entering or leaving their administrations and more importantly that legitimate goods are allowed in or to pass through their administration. One of the ways is to prevent exchange of export cargo with illegal or prohibited goods such as narcotics from transshipments or warehoused goods. Use of physical escorts and manual customs seals has proved to be inefficient, laborious, and has led to considerable delays. They can also be easily circumvented where the manual seal could be broken, goods removed or exchanged and a substitute imitation seal fixed by unscrupulous traders, clearing agents, importers or exporters which are difficult to distinguish from original seals. A study by Wang et al on real time tracking technologies in freight transport concluded that RFID has clear advantages in tracking; as it not only enables tracking of individual containers or trailers but also provides related cargo information. The findings of the study were also that it brought economic benefits to both shippers and carriers, though requires tactful collaborative arrangement between shippers and carriers for successful implementation [34]. The study was however based on Fast Moving Consumer Goods (FMCG) and based on United Kingdom (UK). Despite such great challenges, there is little literature available in academic journals for tracking solutions that provide high level of security to the cargo and with provisions to immobilize or intervene when a suspected breach or intention to commit a breach is identified. Secure tracking of goods entering the global supply chain is therefore of great importance in improving the level of security for sea cargo. Any lapse from any of the countries can be misused for trafficking drugs, explosives or for aiding the terrorist activities by the few but lethal actions from terrorists. However, none of the literature has addressed issues relevant to Kenya in terms of risks and threats of export goods handling. This study therefore seeks to address this gap by exploring the impact of RFID technology on tracking of export goods. The study is undertaken based on a piloted RFID based In-Transit Visibility system in Kenya.

3. System Design 3.1. System Components The designed In-Transit Visibility system comprises the following: i. GPS receiver - For receiving the co-ordinates or location of the truck and availing it to the control room via the GSM/GPRS modem in real time (every five minutes). ii. Active RFID Reader – For interrogating the Electronic Seals to establish their status every short interval and relay their status, alerts and events to the control room in real time via the GSM/GPRS modem. It is also to receive commands from the control room and invoke them on the electronic seals such as arming at the commencement of journeys.

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iii. GSM/GPRS communicating device for transmitting the location (from GPS receiver) and seal status, events and alerts (RFID Reader / RFID Electronic Seals) to the control room. The communication is also used for receiving commands from the control room for action by the AVL unit or RFID Reader and subsequently to Electronic Seals where required. iv. Geofence data – The data was collected for the main gazetted routes used by export cargo. The process constituted picking the co-ordinates of these routes and storing them in a database and associating them to particular routes. Geofence violations were generated where the location of the truck is not within the accepted co-ordinates for the specific route of the cargo. Tolerance of 50 meters on either side is provided by the system. v. Tamper proof RFID based Electronic Seals – These are used to lock all cover body, container doors or valves and hatches for wet cargo. The seal is in the form of a lock that requires a key to open. Any un-authorized opening of the seals immediately registers a tamper that is immediately relayed to the control room. All the seal events are additionally recorded in the seals and can be downloaded at any point along the journey. The Electronic Seal operates on dual mode frequency, UHF 433.92 MHz for long range communication and LF 125 KHz for short range communication. Communication with the Reader in the cabin is through the UHF communication channel.

3.2. Flow Description The location of the truck (provided by the GPS receiver) and the status of cargo (provided by tamperproof RFID Seals) are communicated in real time to the control room. The GPS, GSM/GPRS modem and RFID Reader are all installed in the cabin of the truck and are powered from the truck’s battery. The system is integrated to the electrical system of the truck through which it provides pertinent information of the truck to the control room. The integration is also used to enable intervention on the truck in case of a violation. Bolt Electronic Seals are used to seal all the doors of the containers or trucks or valves and hatches for tankers and armed prior to commencement of the journey. Once armed, the RFID Reader installed in the cabin keeps interrogating all the Electronic Seals at short intervals which together with the location of the truck, tanker or motor vehicle unit from the GPS receiver are transmitted to the control room via GSM/GPRS connectivity. Any tamper of the cargo by opening or attempted opening of the doors, valves or hatches is detected immediately and relayed to the control room. Geofence data is used to monitor compliance of the movement of tracked cargo along the gazetted routes. Any deviation from the geofence beyond the set tolerance generates an alert that is immediately transmitted to the control room or to relevant officers. The system allows the officers to communicate directly with the driver where a violation is noticed. Additionally, they are able to establish the exact condition of the cargo at any point in time. The control room function includes immobilization of the vehicle where there is defiance to instructions by the driver during a violation. The flow of activities commences with programming and attaching the E-seals or tag. • Seals are programmed with details of the cargo, means of conveyance and route; • Programmed bolt electronic seals are used to secure the doors (trucks and containers), valves and hatches (for tankers); • Seals are then armed; • Tracking of the cargo and location then commences; Once armed, the RFID Reader installed in the cabin keeps interrogating all the E-Seals at short intervals. The information on the status of e-seals is combined with the information location from the GPS receiver are together sent to the control room via GSM/GPRS connectivity. Any tamper or deviation is detected immediately and relayed to the control room. Geofence data is used to monitor compliance of the movement of trucks along the gazetted routes. Any deviation from the geofence immediately generates an alert. The control room officers are always able to establish the location using the control room software that indicates the location of all the trucks using icons mapped on google earth map (Fig. 1 and 2) and the exact condition of the truck continuously such as engine status (on/off), speed of truck or tanker (or whether stationary), lights status (on/off), hood status (open/closed), fuel levels among others. Any violation is immediately registered and transmitted to the control room. The officers manning the control room have an array of options for dealing with violations. Flow of activities is given in Fig. 3.

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Figure 1. System Depicting Export Cargo to Regional countries – (red icons represent truck locations)

Figure 2. RTLS System Depicting Export Cargo to Mombasa Port act RFID Based Real Time Tracking Activ ity Flow Factory / Warehouse

Attach Seal/Tag

Associate with consignment & route data

«invariant» {GPS device working and receiving location information GPRS is working and in coverage RFID Reader interrogating and getting Seal status}

In-Transit Visibility «Post-condition» {Electronic Seal/Tag should be Attached or Locked and Armed}

«Pre-condition» {All truck doors, valves, hatches should be locked or attached}

CR Arm Seal

«invariant» {Control Room (CR) Actions include Immobilizing the tanker or truck, contacting the driver and establishing the problem, directing the driver to take a particular route among others}

Frontier Office or Port «Pre-condition» {Seal status should not be tampered}

Tamper Status Checks

«flow»

Interrogate Seal Status, get location information

Transmit Tracking Information to CR

Analyze & Store Received Tracking Data

Attach & Arm and allow to proceed

Tamper Alert CR Action

Unlock Seal /Tag & Verify Cargo

Figure 3. RTLS System Activities Flow

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End Trip

«Pre-condition» {In case of violation, fines and penalties are levied prior to release and allowance to proceed with the journey}


These range from establishing communication with the driver of the truck including immobilization of the truck for Rapid Response Team to intervene and confirm the status of cargo. Besides the alerts being recorded at the control room, the system is programmed to transmit alerts to designated officers such as Rapid Response Teams via Short Messaging or Electronic mail. During the pilot, the journey was terminated at the frontier office; however, the tracking is to be extended to its destination using roaming facility available in the region.

4. Discussion 4.1. Pilot Test Results During the pilot there were a number of alerts and errors generated during the trips. Out of the total of 284 pilot trips analyzed, 189 trips accounting to 66.5 percent of all the trips did not have any alerts apart from the required ones at the start and at the end of the journey (see Table 1 and Fig. 4). Some of the alerts ranged from failure of GPS device to pick the coordinates, failure of the RFID Reader to provide the status of the Electronic Seal, cargo getting out of the geofence route among others. While some of the alerts emanated indicated failure of some components, none of the alerts related to tamper of cargo. ‘Seal Attach’ and ‘Seal Close’ events relate to the beginning operations where the Electronic Seal is attached to the container, valve, hatch or door and ‘Seal Close’ relates to the closing and thus constitute Seal events but do not indicate any error or tamper. ‘Seal Detach’ and ‘Seal Open’ are events that take place at the end of the journey. Unauthorized opening or detaching however constitute tamper alerts. GPS errors occur where the device is unable to calculate the coordinates. This could be due to weak signals from positioning satellite, signal interference or other failures. Seal missing relates to failure of closing the trip at destination and subsequent removal of the seals without doing it through the system. Other errors experienced could be related to equipment malfunction or errors in programming prior at departure. Table 1. Total Events Summary Event Code Count Type Approved Set Execution

1

Normal

GPS / Reader Error

36

Error

GPS / Seal Error

74

Error

Out of Route

1

Violation

Reader / Seal Error

15

Error

Reader Error

77

Error

Seal Attach

252

Start of journey

Seal Close

15

Start of journey

Seal Detach

23

End of journey

Seal Error

343

Error

Seal Missing

1

Violation / Alert

Seal Open

47

End of journey

Seal Return

4

None tracked trip

Seal Set

2

Beginning of journey

Tank Attached

1

Wet cargo start journey

Trip was Closed

17

End of trip

4.2. Alerts analysis

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Out of 284 pilot trips, 189 never had any error or alert. This constituted 66.5 percent of all the trips. 12.7 percent of the trips had one error or alert, 8.8 percent had two while 12 percent while 12 percent had three or more alerts or errors (see Fig. 5).

Figure 4. Events Summary per category

4.3. Impact of Intelligent Tracking One of the key benefits that have been realized with the introduction of intelligent tracking for the transporters is the increased efficiency. A comparison on average duration using manual tracking and intelligent tracking and a substantial improvement was noted. Whereas for the trips evaluated, the average duration to reach the frontier office or port for the destinations evaluated used to vary from 33 to 100 hours, under intelligent tracking the duration for the same locations varied from 20 to 80 hours. A comparison on the time savings per trip is given in Fig. 6. Other benefits that were realized included increased security of cargo and reduced diversion and dumping of goods. Lack of tampering of the Electronic Seals during the pilot confirmed that the installation of solution became a deterrence measure to unscrupulous traders.

Figure 5. Trips versus Alerts / Errors

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Figure 6. Efficiency per trip A window was also provided for the cargo owners and transporters to view tracking information of their trucks. This information became deterrence to errand behavior of drivers such as unnecessary elongated stops, fuel pilferage and running of individual unauthorized errands as their movements could be monitored. The facility of replaying whole journeys using the system freed the cargo owners from having to monitor the cargo continuously, but to have a high speed replay where whole journeys are replayed in a few minutes while noting any errant behavior or action.

5. Conclusion This paper has discussed the impact of RFID on tracking of export goods in Kenya. The system was piloted as a result of the challenges of diversion and dumping of export cargo. The design of the system has been discussed together with the piloting. The events, alerts and errors experienced during the pilot have been enumerated and discussed. The impact of the solution has been discussed in terms of enhancement of security and secondary benefits. The findings from the pilot indicate that security was greatly enhanced to the extent that there was no tamper detected for all the cargo tracked during the pilot period. Additionally, truck and cargo owners registered increased efficiency where an average of 45% savings on turn-around times was realized. RFID therefore has a great potential for securing and tracking goods for customs purposes. The resulting efficiency and security enhancement has great benefits for security and government agencies, cargo owners and truck owners. While the study was undertaken for export goods in Kenya, the solution is generic and can be used by customs administrations from other regions as well as any entity interested in secure tracking of cargo.

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