Shipping Lines Go Mad Over High Charges

Tema port

Tema port

Accra, October 9, 2017//-Shipping lines have warned that they could be forced to stop calling at the country’s sea ports if what they consider to be “excessive charges” are not curtailed.

“It could come to that point, if shipping lines realise that the high charges cannot be passed on to end-consumers of their services and Ghana’s ports are becoming uncompetitive for business,” Adam Imoro Ayarna, Vice President of the Ship-owners and Agents Association of Ghana (SOAAG) told the B&FT.

“If the government wants to reduce the cost of doing business at the ports, then this is the time for cool heads,” he said.

Already, some vessels which used to call at the country’s seaports four-times per month have reduced their calls to two, whilst others berth at neighbouring ports and use their feeder vessels to transship their cargo to the Tema Port, due to the perceived high charges.

“If we don’t take time, cargo that should land directly in Ghana will be discharged in Lome, waiting for feeder vessels to cart them to the country’s ports and you can imagine the delays and cost,” Mr Ayarna said.

The Ghana Maritime Authority, under a new leadership, has reviewed upward the safety and security charge for shipping lines from 0.15cents to 50cents, effective October 1, this year.

This means a vessel that used to pay the GMA about US$6,000 per month in security and safety charges will now have to pay between US$25,000 and US$30,000.

The safety and security charge is backed by the Authority’s regulations passed in 2012, which allow the imposition of maritime safety fees and charges on installations, ships, pipelines, cables and other assets employed in the maritime domain.

But the brewing tension is because the regulator is restricting the shipping lines from transferring the cost of the adjusted tariff onto the end-consumers, who are the importers and exporters, in this case.

Mr. Ayarna argued that shipping lines cannot absorb the cost at a time that third party costs are already eroding actual freight.

“For ships that do transshipment, which will have to take up this new charge, they may want to choose a more competitive port at the end of the day,” he said.

With all these port reforms ongoing and the shouts about the high cost of doing business at the country’s ports, this is not the right time for an increase that should ideally be introduced at a slower pace,” he noted.

The association argues that making the country’s territorial waters, with all its installations, safe and protected should be the responsibility of the government and all relevant stakeholders, which requires that related costs are shared among all parties.

Currently, 11 members of SOAAG pay the GMA averagely US$320,000 per month in safety and security charges while nine members pay the Ghana Shippers Authority US$780,000 every month in service charges.

The GMA is entitled to 50percent of the money that shipping lines pay to GSA in service charges, which means the maritime sector regulator makes US$710,000 from shipping lines each month.

Should the shipping lines decide to play the boycott card, cargo inflow to the country’s ports and general port productivity will be affected. The situation could also lead to delays in the arrival of goods, with added costs to the consignee.

“Ultimately, such a situation will harm the end-consumer and the economy as a whole, because any cost to the business must be recouped at the end of the day,” Mr. Ayarna emphasised. B&FT

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