GIFF attributes 25% of demurrage to shipping lines

Co-chairman GIFF Monitoring Team, Romeo Frimpong

…wants weekends, holidays charges scrapped

A co-chairman of the Ghana Institute of Freight Forwarders (GIFF) Monitoring Team, Romeo Frimpong, has advocated that it is important for the procedures of shipping lines operating in Ghana to be streamlined.

The GIFF executive said this in relation to the longstanding issue of demurrage, which he said is a deliberate creation of the shipping lines purely for purposes of making profit.

Romeo Frimpong averred that all stakeholders have their part to play when it comes to eradicating demurrage, which continues to negatively affect the cost of doing business in Ghana.

He revealed that the preliminary paper done through GIFF’s research hub indicated that 25% of demurrage causes are attributed to the shipping lines.

“At the heart of the causes of demurrage is the counting of weekends and holidays. We are of the view that weekends and holidays when they do not work must be scrapped. If laws of the state say we should observe holidays, why do you charge me demurrage on such days? It does not make business-sense, so we have advocated that the holiday aspect in the invoice should be scrapped,” he asserted.

This perspective, he said, is necessary in order to put the issue to bed.

The GIFF Monitoring Team Co-chairman said his outfit has also been impressing upon the Customs Division of the Ghana Revenue Authority to decouple payment of duties from shipping line release.

“Gone are the days we paid duties, printed physical copies and took them to the shipping lines and let them inspect them to confirm they have been paid. But now, just with the click of a key over the Internet, the Customs authorities will be notified when I pay. They do not need the shipping lines to verify for them. If you pay your duty on Friday evening, the lines do not work on Saturday so you will not be able to be granted release to work on weekends. But if you decouple the duty payment from shipping line release you can go to the shipping line and make your payments, get your release done, and then anytime you want to pay your duty you can do so to have your goods cleared at any of the terminals which work 24/7,” Mr. Frimpong explained.

In the same vein, he said the shipping companies should review their position on demurrage….which he says the lines have built a business model around.

“Demurrage is just meant to incentivise the cargo interest to hurriedly retrieve the cargo and return the container. It should not be a punitive measure, but we realise most of these lines are making business models out of this mine. They are capitalising off the fact that we are bound by time. If you go and they do not release for you, you will be forced to pay.”

On the other hand, Romeo Frimpong urged importers to be proactive in their dealings with clearing agents for effective and efficient clearance of goods.

He urged them to visit the offices of credible Customs house associations, like the Ghana Institute of Freight Forwarders (GIFF), when in search of credible agents to clear goods on their behalf.

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