PORT MANAGEMENT ASSOCIATION OF WEST AND

CENTRAL AFRICA

13TH ROUND TABLE CONFERENCE GOLF HOTEL ABIDJAN; JUNE 29 - JULY 2, 2015

PORT TRANSIT COSTS

PERSPECTIVES AND EXPERIENCES OF

GHANA PORTS

BY

RICHARD A. Y. ANAMOODIRECTOR - GENERAL (GPHA)

OUTLINE•Introduction•The Nature of Port Transit Costs•Port Authority and Terminal Operator Charges•Charges of Other Economic Operators•Aggregate of Container Handling Costs•Strategies for Reducing Costs s•Conclusion

IntroductionPorts play a very strategic roles in facilitating World Trade. They are

the main international gateways for a country’s import and export trades.

It is estimated that 90% by volume and 80% by value of worlds international trade in merchandise is routed through orts.

In many developing countries, the bulk of internal revenue in the form of customs duty and import VAT are collected at the ports.

These make ports veritable engines of economic growth.

THE NATURE OF ORT TRANSIT COSTS

The Nature of Port Transit Costs• Port Transit Costs are the monetary measure of what port users’

pay to the Port Authority and Terminal Operators for using facilities and services of a port.

• Port Transit Cost is an important component of Transport Costs.

• For seaborne trade, transport cost is extremely important; and it is made up of the following:

• Inland transport between the place of production and the port of shipment,• The cost of handling the goods through the ports of export and import (port

costs); and • The cost of carrying the goods on the sea leg (maritime transport cost)

The Nature of Port Transit CostsTransport cost, of which port transit cost is an important component, is a major determinant of the landed price of goods.

For low value primary products, transport costs constitute a major proportion of the landed price.

The need to improve port transit costs as part of overall strategy to improving the competitiveness of the exports of developing countries in global markets is an imperative.

The Nature of Port Transit CostsPort Transit Costs generally comprise the following:

1. Charges by Port Authority and Terminal Operators:

Dues on Cargo and Vessels

Charges for the services used in bringing vessel into and out of Port

Charges for the Loading/Offloading the Vessel (Stevedoring)

Charges for Receipt and Delivery

Charges for Storage of Cargo in the Port

2. Charges for Services Provided by other Economic Operators Shipping Line Charges• Container Administration Charge• Port Security Charge• Evacuation Charge• Demurrage Charge• Release and Documentation

Freight Forwarder/Clearing Agent Charges Freight Transport Operator Charges

PORT AUTHORITY AND TERMINAL OPERATOR CHARGES

PORT DUES – US$DESCRIPTION Import Export Transhipment Transit

Dry Bulk 2.00 2.00 1.20 1.20

Conventional 4.00 4.00 2.40 2.40

Unpacked Saloon Car 26.50 26.50 15.90 15.90

Container - 20' Full 45.00 45.00 22.50 22.50

Container - 20' Empty 23.00 23.00 11.50 11.50

Container - 40' Full 83.50 83.50 41.75 41.75

Container - 40' Empty 42.00 42.00 21.00 21.00

VESSEL HANDLING (MARINE SERVICES) CHARGES

Description US$Remarks

Pilotage 1,672.32 For inbound and Outbound JourneyTowage 3,600.48

Mooring/Unmooring 463.84 Berth Occupancy 3,281.20 Light Dues 2,100.00

Vessel LOA = 200 metres; Vessel Gross Ton=25,000; Time at Berth=72 Hours

STEVEDORAGE – US$DESCRIPTION Import Export Transhipment Transit

Dry Bulk 3.64 3.64 3.64 3.64

Conventional 10.4 10.4 13.52 8.84

Unpacked Saloon Car 49.92 49.92 60.32 37.96

Container - 20' Full 104.52 104.52 139.36 74.36

Container - 20' Empty 82.68 82.68 122.72 58.24

Container - 40' Full 196.56 196.56 265.2 140.4

Container - 40' Empty 148.72 148.72 231.92 109.2

RECEIPT AND DELIVERY CHARGES – US$

DESCRIPTION Import Export Transhipment Transit

Conventional 1.20 0.83 1.50 1.50Unpacked Saloon Car 74.40 50.60 19.50 13.00Container - 20' Full 55.00 28.33 36.00 28.00Container - 20' Empty 46.28 34.32 12.48 34.32Container - 40' Full 33.60 22.83 39.00 23.00Container - 40' Empty 46.28 34.32 12.48 34.32

FOR EXAMPLE: MV SANTHYA (CONTAINERS)

US$ %

Vessel Handling 14,865.42 6.21

Port Dues 59,720.00 24.93

Stevedore 164,976.50 68.87

TOTAL 239,561.92 100.00

M.V. Diligence

US$ %

VESSEL HANDLING 13,457.50 5.65

PORT DUES 59,720.00 25.08

STEVEDORING 164,976.50 69.27

TOTAL 239,561.92 100.00

Vessel LOA: 169 m Vessel GT=16761; Vessel Time at Berth-224.45 Hours; Cargo = 14,930 Tonnes)

CHARGES OF OTHER ECONOMIC OPERATORS

Sample Charges of Other Economic Operators 20’ Import Container

Shipping Line Charges US$

Container Administration Charge 195.00 Port Security Charge 22.00• Container Cleaning Charge 10.00

Freight Forwarder Charges 85.00

ROAD FREIGHT TRANSPORT CHARGES

(SOURCE: GNTDA 2013 TARIFF)

TRANSPORT CHARGES DISTANCE (Km)

20’ CONTAINER US $

40’ CONTAINER US $

TEMA (Afienya) 24.2 150 175SPINTEX 20.1 162.5 200ACCRA 35.3 187.5 250KUMASI 277.7 425 550TAKORADI 249.6 375 450 BOLGA 725.1 875 1,050ELUBO 383.4 675 875AFLAO 180 375 525PAGA 932.7 1,000 1,350

AGGREGATE OF CONTAINER HANDLING COSTS

Aggregate Cost of 1 X 20’ Import Full Cont.1. Port Authority/Terminal Operator US$ % Port Dues 45.00 Stevedorage 104.52 Receipt and Delivery 55.00

204.52 39.602. Shipping Line/Agent C Container Administration 195.00 Port Security Charge 22.00 Container Cleaning 10.00

227.00 43.953. Freight Forwarder Professional Fee 85.00 16.46

GRAND TOTAL 516.52 100.00

STRATEGIES FOR REDUCING COST OF DOING BUSINESS IN THE PORTS

Strategies for Reducing Cost of Doing Business in the Ports

•Port Reforms – Increasing Private Sector Participation in the management and operations of the Port

• Investing in new Facilities – Development of ICDs, Procurement of New Cargo Handling Equipment, Dredging, etc.

•Deployment of Information Technology - Massive investment in IT to improve business processes

Strategies for Reducing Cost of Doing Business in the Ports

• Training and Development of Staff – Training of Staff in Port Operations and Customer Care

• Adoption of ISO 9000 Quality Standards – Implementation of ISO 9000 quality management system to enhance efficiency and service quality.

• Collaboration with Stakeholders – Collaboration with Customs, Freight Forwarders, Transport Operators, Concessionaires, Licencees, etc. to improve service delivery.

• Regulation of Charges - The Ghana Shippers Authority has been mandated by law to approve charges of service providers.

Rubber-tyred gantry cranes delivered in

June, 2013

Reachstackers and Forklift Trucks

Procurement of Additional Cargo Handling Equipment

MOBILE HARBOUR CRANES

ELECTRONIC GATES: OPTICAL CHARACTER RECOGNITION SYSTEM

CONCLUSION

1. Port Transit Cost is an important component of Transport Costs.

2. Transport costs impact the landed costs of goods and the competitiveness of a country’s exports.

3. The key to reducing port costs is to improve port performance and productivity.

4. This requires collaborative efforts by all port operators and stakeholders.

5. The port authority should take a lead role in promoting efficiency of the ports and relative services.

CONCLUSION

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Thanks For Your Kind Attention