Windhoek – Ports in Southern Africa are not upfront with their terminal handling charges, which makes the ease of doing business in the region difficult and the hidden cost thereof ridiculously expensive, says Ed Richardson, Freight and Trade Weekly correspondent.

Richardson said while a growing number of ports in the Southern African Development Community (SADC) region is open to negotiation on charges, some simply do not respond to requests for information and information seekers have to rely on the World Bank for available data.

This, he said, is due to the heavy competition experienced by the different transport corridors where there is no harmonisation of tariffs or political will to unify trading across borders.

He stressed that ports that have invested in certain routes for over 100 years and have depots there would never advise a customer to go through another port.

There are huge variations in terminal handling costs in the six ports in SADC countries, namely Namibia (Walvis Bay), Mozambique (Maputo, Nacala and Beira), South Africa (Durban) and Tanzania (Dar es Salaam).

According to figures provided, the Walvis Bay port is unusually expensive, with double or three times higher tariffs, followed by Maputo and Durban, while the Dar es Salaam, Maputo, Nacala and Beira’s costs, which are the lowest, are on average similar.

For example, for handling 20 feet cargo in transit, the Walvis Bay port charges US$216.88, while Maputo and Durban would handle the same cargo for US$148 and US$123, respectively.

This is in stark contrast to the US$80 that Dar es Salaam and Beira charge cost the shipment or the US$74 charged by Nacala.

A 40-inch reefer would be exported at a cost of US$593.69 at the Port of Walvis Bay, while Maputo would quote US$357 for such a cargo and Durban US$260.

Dar es Salaam would only charge US$120 for such a transaction, Nacala (US$153) and Beira (US$180). The determinants of cost include berthing delays, surcharges, port costs, poor port productivity, inefficient landslide logistics, customs, delays in releasing cargo and congestion inside and outside the port.

However, when it comes to total export and import costs as per the four countries’ ports, Tanzania has the highest tariffs of US$1,435 for total export and US$1,725 for total import, according to the World Bank. These costs include border and document compliance as well as hours spent on each transaction for exports and imports.

Interestingly, Namibia has the lowest import cost of US$208.

Richardson said on the surface when doing micro comparisons, the Walvis Bay port looks too expensive, but it was the only port that had readily available tariffs – even downloadable ones online, while it was a struggle to get tariffs from other ports as they instead send enquirers to shipping companies.

“For transport corridors to work, make the cost of using corridors cheaper,” said Richardson, urging corridors to work together.

He said the Walvis Bay Corridor Group was doing well in comparison, even when it comes to the safety of its corridor, whereas there have been hijackings in other corridors.

“Namibia’s logistics plan is embedded in its national development plan,” commented Richardson, adding that the reason why logistics plans for other countries were not working, was because there is no government output.

Other experts have also indicated that tariff liberalisation across the SADC region was blocked by the countries’ deprivation of investment in transport infrastructure.

The Southern African Customs Union has also highlighted the serious regression of its member states performance in doing business and pointed out that something urgently needs to be done to improve and reform the business and investment environment.

According to the United Nations Economic Commission for Africa Computable General Equilibrium estimates on continental free trade area, tariff removal by 2017 would have resulted in an increase in trade from 10.2% in 2010 to 15.5% in 2022.

But if trade facilitation was to be addressed in intra-African trade, it would double trade from 10.2 %in 2010 to 21.9% in 2022.

Source Southern Times

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of TradeMark Africa.