USD$27m demurrage paid to shipping lines in 2019

CEO-Ghana Shippers' Authority, Benonita Bismarck

Data from the Ghana Shippers’ Authority (GSA) have shown that demurrage payments to shipping lines in 2019 amounted to $27million; this figure was less than the $39million recorded in 2018.

According to the Authority, some of the causes of demurrage – fees importers pay for overstayed containers – include bureaucratic operation procedures, system issues which include changes in cargo clearance platforms, and delays in exemption/permit processing among others.

As a result, the Authority has enhanced its meetings with key stakeholders and sensitisation of the public on measures that can be taken to avoid the payment of demurrage – one of the high costs in the sector which can result in higher pricing of goods imported into the country.

The Chief Executive Officer (CEO) of the GSA, Benonita Bismarck, told B&FT that the sensitisation is having a good impact as the figures are coming down.

“The sensitisation in going down well; obviously, we are not where we want to be but some improvements have been made. As we always say, demurrage is avoidable – and that can be achieved with proper planning and financing. The shipping lines would rather have their containers returned with cargo in them, or to pick cargo somewhere else, than let them be in a port and accrue demurrage.”

She added that: “You don’t need to ship 10 containers if you really know you can only finance five or two; ship what you can finance and there is always time for you to ship the rest”.

The Head of Freight and Logistics at the GSA, Fred Asiedu-Dartey, also told this paper that the GSA anticipates getting a reduction in demurrage figures for 2020; but the COVID-19 pandemic and introduction of the Integrated Customs Management System (ICUMS) might derail their projections, as the two caused some challenges with clearance of goods.

“There is a likelihood that the estimated demurrage for 2020 will see a rise. The reason is that when the lockdown happened as part of measures to fight spread of the virus, people were impeded in their moves to clear cargo; consequently, there was a backlog that triggered the need for a waiver. Following from there, with the introduction of ICUMS there was a little difficulty with the clearance of goods; and as a result the shipping public made another request for a waiver, but that was a difficult call,” Mr. Asiedu-Dartey said.

According to him, the research department of the Authority has continued to do a painstaking job in getting demurrage figures due to the ripple-effect it has on the economy.

“These numbers are very instructive and clear pointers to the level of cost that importers take on, because there are institutional and personal issues which point to delays in the port.

“As a result, the shipper has to pick up costs in order to clear their cargo. It is very regrettable some of the things are such that it is difficult to deal with; so, the sensitisation’s focus is on every area that has to do with the individual importers actions, leading to demurrage being reduced.

He said the GSA is in constant deliberation with key stakeholders of the sector to ensure bureaucracy is reduced to the barest minimum to give importers some good breathing space: “Every little delay comes with a cost, and when the importers pay it they will pass that cost on; so your watch, shirt, shoes and cars will all become very expensive – therefore, a national action is required to fight demurrage”.

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