Ms. Benonita Bismarck, the Chief Executive Officer of the Ghana Shippers’ Authority, has urged experts in trade and transport to leverage technology to streamline processes, reduce paperwork and increase transparency.
She said, “we need to prioritize investment in transport infrastructure and upgrade the skills of the players in the industry.”
Ms Bismarck was speaking at the opening of a two-day Meeting of the Union of African Shippers’ Council (UASC) Committee of Experts on Transport Costs in Accra.
The meeting brought together key experts on international trade and transport from Member countries to deliberate on the critical issue of high transport costs within the industry.
It further deliberated on the findings of9 the previous meetings aimed at achieving the objectives of the Committee, especially finding a lasting solution to the high cost of doing business in the ports of the Subregion.
The Committee of Experts on Cost was inaugurated in Abuja, Nigeria in October, 2021 and was giving a time frame of 12 months to carry out its assignment and submit a report within 10 months.
The Chief Executive Officer said there was the need to take coordinated actions as a regional body to protect and promote the interest of shippers in the sub-region.
She said the critical role played by international trade in economic development was well known by all, particularly as a driver of economic growth and prosperity for the people of the continent.
However, the transportation cost in the shipment of international cargo in Africa had become prohibitive and formed a significant proportion of the cost of imports and exports.
She said the development impacted negatively on the competitiveness of African businesses on the global market scene.
The World Bank estimates that transport costs in Sub-Saharan Africa averages 50 per cent higher than other regions of the world, forming a significant proportion of the overall cost of goods.
She said the high transport costs in Africa stems from inefficient supply chains, poor transport infrastructure and networks, lack of economies of scale and inadequate regulatory frameworks, among others.
Ms Bismarck said unfortunately, it was the continent’s shippers, who have to bear the brunt of these challenges.
“The multiplier effect is the consistent rise in the general prices of goods and services and its attendant adverse effects of stagnated economic growth,” she added.
She said the Ghanaian government had been committed to creating an enabling environment for businesses and investments to thrive.
She said initiatives aimed at improving the transport infrastructure in the country include the expansion of our seaports, construction and expansion of airports and international highways.
“We are also working towards improving our regulatory environment to reduce bureaucracy, human interfaces in trade transactions and to eliminate illegitimate charges at our ports, to reduce the cost of doing business,” she added.
Mr Abayome Adewuyi, Assistant Director Trade Services, Nigerian Shippers Council, said the Terms of Reference of the Committee were to determine the components of shipping and other logistics costs in the supply chain in West and Central Africa, identify all surcharges and tariff headings applicable in West and Central Africa and to confirm the justification or otherwise of all surcharges and tariff headings identified in the sub region.
The rest are to identify the factors responsible for delays, as well as high cargo clearance cost in West and Central Africa, identify the factors responsible for high cost of transportation in West and Central Africa and recommend appropriate measures to address the incidence of high transportation cost in West and Central Africa.
The principal objective of the Committee was to address the seemingly intractable problem of high cost of transport, especially with regard to the region’s international trade and find workable solutions to this important challenge confronting the Sub-region.
He said the Committee would not continue to watch while the foreign shipping companies continue to exploit the subregion with higher freights and surcharges.
“We should thoroughly interrogate the reason why the transportation cost component of commodities in the subregion is more than 35 per cent, whereas, it is less than 10 per cent in other developing economies and less than 5 per cent in the developed economies,” he said.