Importers losing US$300 million in illegal freight charges - AGI

Accra, Nov. 7, GNA - Mr. Tony Oteng-Gyasi, President of the Association of Ghana Industries (AGI), on Wednesday said local importers were losing US$300 million a year in illegal freight charges by shipping lines at the various entry points.

He said for shipments that consignors in the country of origin had paid freight charges to the shipping lines, consignees in Ghana who took delivery of those shipments also paid freight charges to the shipping lines in addition to all the duties and handling charges at the port. "This is illegal and it must be stopped with immediate effect," he said.

Mr. Oteng-Gyasi made the call at the launch of a World Bank Group report titled, "Doing Business in Ghana 2008."

The report, which was a project benchmarking the regulatory cost of doing business in Ghana ranked Ghana the 87th easiest business destination among 178 economies based on at least 10 criteria points. The criteria included registering property, for which Ghana was ranked 26, protecting investors, 33, enforcing contracts, 51, trading across borders, 61, paying taxes, 75, closing a business, 96, starting business, 138, employing workers also 138 and finally dealing with licenses, 140.

Mr. Oteng-Gyasi noted the the issue of double freight charging at the entry ports was a concern to importers, saying that the issue had been raised in several forums in the past but very little had been done to correct the anomaly.

He noted that although Ghana performed creditably in the areas of reforms in property registration, investor protection and the enforcement of contracts, there was the need to sustain the gains through strict adherence to deadlines and the new turn around times.

"One way we can sustain the gains is by ensuring the availability of credit to businesses to prevent their collapse due to inability to source funding. In that respect it would be important for the report to also capture the cost of credit in Ghana to assist in providing cheaper credit for businesses," he said.

Mr. Oteng-Gyasi noted that currently the registration period for business in Ghana had changed from six months to a month, but more needed to be done to ensure that the system did not backslide. He observed that even though the turn around time of business registration had reduced considerably, there was the need to choose between the colonial deed registry and land title registry, both of which continued to ran along side each other for the past 50 years. Mr. Oteng-Gyasi also noted that the centrality of institutions in the capital cities did not auger well for the redress issues regarding business in the country, saying that even though the report took note of the existence of commercial courts in the country, those courts were centred in Accra and therefore business in the other regions did not have easy access to such facilities.

The AGI Boss also noted that one other problematic issue to businesses in Ghana was the cost of firing workers, saying that even though there was huge unemployment in the country, the economy was largely labour intensive and for that, it was expensive to sack unneeded workers.

Mr. Charles Cofie, Chief Executive Officer of Unilever noted that Ghana Export Promotions Council (GEPC) and Ghana Standard Boards (GSB) inspection periods usually delayed goods meant for exports at the ports and that incurred cost in terms of times and port charges to exporters. He also noted that the cumbersomeness of the processes of trade within the sub-region made the cost of shipment within the region more expensive than the cost of shipment to anywhere else in the world.

Mr. Cofie express unhappiness with the fact that even though under the GCNET system of export data, exporters were required to provide their export information online, hard copies of export documents were still required at the ports.

"This practice is counter productive to our efforts to facilitate the process through the online GCNET facility," he said. Ms. Dzifa Amegashi, Director of Corporate Finance at CAL Bank said there was the need for countries in the sub-region to also perform as high as Ghana in order to cut down the cost of doing business within the sub-region.

"Our star performance as a country would mean nothing if the other countries in the sub-region continue to perform low," she said. For instance, according to the report, whereas Ghana had made significant reforms in the at least five areas, particularly in trading across borders, none of the countries in the sub-region had made reforms in trading across borders.

Mr. Kwaku Agyeman Manu, Deputy Minister of Trade, Industry and PSI said the gains made were indicative of the prudent monetary policies and reforms instituted by the sitting government, but there was need to ensure that those gains reflected in the pockets and living standards of the ordinary Ghanaian.