Dar, Mombasa ports add misery to business community

An aerial view of Dar es Salaam port

By BUSINESS REPORTER

DAR ES SALAAM and Mombasa ports have been singled out as the biggest obstacles to trade in the region in a report released on the eve of East African Communities budgets that were read simultaneously last Thursday.

The revelation emerged even after Finance minister Njeru Githae said by December 2012 all weighbridges would be relocated to ports of entry and all road blocks either removed or reduced to a bare minimum.

The Business Climate Index (BCI) survey conducted by the East African Business Council (EABC) says the two ports have been a key bottleneck to fast and efficient clearance of imports and exports.

The situation has been blamed on inefficient cargo handling facilities, poor speed in transferring cargo from incoming vessels to Internal Container Depots, and insufficient warehousing facilities for incoming cargo.

Lead barriers

“The findings show that with respect to non tariff barriers (NTBs), customs procedures and administrative requirements are considered by businesses as the most severe among the NTBs, followed by police, weighbridges, immigration, technical standards, business registration and licensing and sanitary and phytosanitary standards,” Keli Kiilu, Director at EABC said during the release of the survey last week.

The survey found out that Container Freight Stations, which were originally introduced to address ports’ congestion by facilitating direct movement of cargo from the port area have been unable to cope with increased demand for containerised cargo, but have contributed to increased congestion resulting to inevitable imposition of vessel delay surcharge by some shipping lines.

“There is a need to increase berthing capacity for incoming ships, efficiency in cargo stacking, efficiency of cargo take-off by the rail system in Mombasa and Dar es Salaam. There is also need for the establishment of an integrated system in the physical infrastructure system that links roads, rail, and pipeline and port infrastructure.”

Customs administrative procedures and documentation requirements at the two ports were also singled out as cumbersome.

The procedures and requirements, which play an important role in tax collection and trade promotion functions are perceived as too lengthy, resulting in time loss and other negative impacts.

Further custom systems used to classify imports (ASYCUDA and Simba) sometimes experience network failures resulting in lengthy time for clearing import transactions.

“Clearing procedures that rely on electronic processes are usually delayed due to frequent network failures and power blackouts,” Andrew Luzze, a policy analyst at EABC said.

The survey found out a major bottleneck regarding utilisation of the EAC Simplified Trade Regime, whereby many informal cross border traders are not aware about the scheme, while those who are aware about it such as those at Malaba Border Station are subjected to harassment by border security staff on the Ugandan side who demand bribes to let goods cross borders, failure to which the simplified Certificate of Origin already approved by customs are torn to pieces.

The survey found that Kenya and Tanzania have 12 and 13 weighbridges along the Northern and Central Corridors respectively.

The weighing process on average takes between one to eight hours, sometimes days while the stations are also an avenue for bribes ranging between Sh2,000 to Sh5,000 as reported by most of the drivers.