Delays, corruption incease cost of business (Thursday, May 20, 2010, Pg 55)
THE delays in transacting business at the Tema port and corruption on the Tema-Ouagadougou route have been found to be the major impediments to promoting competitive trade between Ghana and Burkina Faso.
According to a study by the West Africa Trade Hub (WATH), a non-governmental organisation with a focus on removing trade barriers in West Africa, delays in Tema remained the major bottleneck on importation, as almost half the standard time and
Trade Minister, Hannah Tetteh
more than half the additional delays occurred during the port clearing process.
The study, the 11th in the series of other studies in the sub-region aimed at lowering transport cost, conducted in the last quarter of 2009, also found that bribes paid at road barriers amounted to less than 10 per cent of the total amount of bribes paid by traders on imports.
The USAID sponsored study, which forms part of the WATH’s Improved Road Transport Governance and Borderless projects, also found reasons including uncompetitive trucking markets in the two countries, complex customs procedure at the Tema Port and the Ouagarinter (Custom Clearance yard in Burkina Faso) and corrupt practices as the challenges confronting the movement of goods from Ghana to Burkina Faso.
The study recommended the creation of a single market in the ECOWAS region in order to eliminate internal borders between ECOWAS countries and ultimately create a single transport and logistics market which would effectively make Burkina Faso and other Sahelian countries in the sub-region “non-landlocked.”
The study also called for streamlining customs procedures to reduce the excess documentation and deregulation of the West African trucking market to promote competition based on pricing and quality service in order to eliminate corruption.
Addressing a press conference to introduce the report, Mr Niels Rasmussen, the Transport Director of the WATH, said reducing the cost of doing business along the Tema-Ouagadougou route remained an important hurdle which must be cleared in order to make the West African sub-region more competitive.
According to him, “Unofficial payments add uncertainty to transactions, reduce confidence in the rule of law and discourage investment.”
He indicated that the recommendations of the study when implemented would go a long way to promote regional integration.
Mr Rasmussen said there was the need for governments in the West African Region to strengthen their resolve to improve trading activities in the region.
Comparing the Tema-Ouagadougou route to the Chicago-Newark routes, which are of the same distance, he said transiting goods from the Tema port to Ouagadougou cost seven times as much as moving goods from Newark to Chicago.
He added that whereas it took as long as 13-22 days to travel the distance from Tema-Ouagadougou, it took five days to travel the same distance from Chicago to Newark.
The President of the Burkina Faso Shippers Council, Mr Yaya Yenda, for his part, said there was the need to standardise the axle load system throughout in order to promote competitiveness.
He noted that it was heart-warming that by the end of 2010 all countries in West Africa would be able to implement a standardised axle load policy.