Avoiding Demurrage at the Ports: Ghana Shippers’ Authority sensitizes Importers and Exporters

The Ghana Shippers’ Authority (GSA) has begun collaborations with major stakeholders to sensitize shippers on effective ways of avoiding demurrage. The first of such events was held in Accra on Thursday with the Ghana Union of Traders Association (GUTA), where over a 100 Importers and Exporters got sensitized on the issue.

“The reduction of the total amount of demurrage and rent payment is a priority for the Ghana Shippers’ Authority. We are confident that these shipper education and sensitization programmes would create the necessary impetus for the avoidance of demurrage and rent payments,” stated Sylvia Asana Dauda, deputy Chief Executive Officer of the GSA, who spoke on behalf of the CEO Benonita Bismarck.

Demurrage is a result of a failure to abide by the rules agreed to in a charter agreement. Specifically, it is when a charge is payable to the owner of a chartered ship on the failure to load or discharge the ship within an agreed time.

“The high cost of doing business remains one of the biggest disincentive to the growth of import and export businesses in Ghana. A major cost item is container demurrage, which has become a significant drain on the capital of import and export businesses. In fact, research has shown that in 2017 alone, over US$ 75 million was paid as demurrage at Ghana’s ports with an estimated Ghc 48 million paid over the same period as Port Rent,” the deputy Shippers’ Authority CEO revealed.

She is therefore of the view that demurrage and rent are avoidable payments at the ports and that if shippers are able to clear their cargo generally within the first Seven days free period, they do not have to pay demurrage or rent charges.

“Unfortunately, a number of shippers enter demurrage and rent period due to several reasons” which is what has necessitated the sensitization seminar.

She is hopeful that the seminars would among others empower stakeholders to take steps to clear their consignments from the ports within the allowable Seven days free period; ensure that the estimated $75 million paid as demurrage will be reduced to a mere $ 5 million or less; and that together the various participants would clearly define the administrative framework for how to deal with containers that are returned on weekends or holidays.

A member of GUTA sharing his views

President of GUTA, Dr. Joseph Obeng, who was grateful to the GSA for the seminar shared the view that “the cost of doing business especially at our ports remain one of the biggest disincentives to the growth of import and export businesses in the country.

“A major cost item is container demurrage, which has become a key drain on the capital of import and export businesses.”

While emphasizing the need for a closer collaboration among stakeholders to ensure a reduction in the cost of doing business, facilitate trade and to increase revenue for national development, Dr. Obeng sent a special plea to the Ghana Shippers’ Authority to make the sensitization of the traders on the issue to become a regular feature on their calendar.

Also present at the seminar were representatives of Ship Owners and Agents Association of Ghana (SOAAG), the Ghana Institute of Freight Forwarders, the Ghana Ports and Harbors Authority (GPHA), the Ghana Revenue Authority (GRA), among others.

Source: Jeorge Wilson Kingson || ghananewsonline.com.gh

 

 

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