Stephen Oduro (left) exchange documents with Emmanuel Yoda (right) as Benonita Bismarck, CEO, Ghana Shippers Authority and Seth Dwirah look on
SIC Insurance yesterday signed a Memorandum of Understanding (MoU) with the Burkina Faso Chamber of Commerce for the implementation of the single transit guarantee system.
Stephen Oduro, Managing Director of SIC Insurance, said the scheme, which involves the transportation of imported goods by road from Ghana’s ports to Burkina Faso, would also facilitate the documentation process and reduce paper work.
SIC Insurance and Burkina Faso Chamber of Commerce are serving as national guarantors for their respective countries.
Status quo
“Typically, any person importing goods for transit must deposit a security in the form of cash, insurance bond or bank guarantee to cover payment of customs duties or other charges due on the goods in every transit country in case the goods in transit are short landed or diverted.
“However, the current practice has been criticized as being a serious drawback to trade because of the cost as a result of the premium rates, bank charges and bond fees.”
Expectation
He said the Single Transit Guarantee Scheme, when implemented, would improve efficiency of customs operations and bring relief to traders and shippers by reducing the turnaround time for securing transit bond from every country that the cargo passes through.
This is expected to reduce the cost of transit trade and vehicle turnaround time.
“Besides curbing cargo theft, the system will also help to seal loopholes that cause member countries to lose revenue through suspected under-declaration of the value of export or cargo theft.
“Again the implementation of the Single Transit Guarantee Scheme will help remove the opportunities presently exploited by some middlemen at our ports who use fake tax identification numbers (TIN) to clear goods for transit and in turn divert them onto the local market.
“A single guarantee system requires the issuance of a single bond to cover the entire journey from the port of departure to the destination. This will ensure that customs officials in the transit country receive proper payment of duties for any goods moved through their territory.”
Hurdle for customs
Seth Dwirah, Deputy Commissioner in-charge of Operations at the Customs Division of the Ghana Revenue Authority (GRA), commended the move, indicating that transit trade had been a serious challenge with customs, adding that recalcitrant traders smuggled goods leading to revenue leakage and under-selling of those who paid their duties.
Emmanuel Yoda, Deputy Director-General of the Burkina Faso Chamber of Commerce, in a remark, said the move was critical to show ECOWAS that the national guarantors could establish the mechanism.
He, therefore, called on customs administration, clearing agents, importers and exporters of both countries to ensure the success of the system.
Other stakeholders include GCNet and Borderless Alliance.
A business desk report