For Online E-newspaper
The East African : Dec 5th 2015
34 The EastAfrican BUSINESS DECEMBER 5-11,2015 One yea≥ late≥, Single Customs Te≥≥ito≥y d≥ives g≥owth in t≥ade COMMENTARY BY A CORRESPONDENT “Oil consignments intended for Uganda and Rwanda are now cleared in bulk of up to 1 million litres in a single transaction. This results in operational cost savings.” 11.5 per cent increase in volume of goods handled at the port of Mombasa. Rwanda and Uganda have T saved a combined $400 million in clearance and inland shipping costs from the port. The five member states of the East African Community areworking for towards greater economic integration, are build a single, coherent and efficient market in the region in keeping with their obligations under the EAC Customs Union. Kenya, Rwanda and Uganda Protocol launched a pilot SCT in January 2014, unifying the cCustoms procedures along the MombasaKampala-Kigali route, to create a flow of freight from Mombasa port to the interior and back. Under the SCT, several weigh- bridges and Customs posts have been streamlined or removed altogether to allow for the free movement of goods. For instance, oil consignments intended for Uganda and Rwanda are now cleared in bulk of up to 1 million litres in a single transaction. This results in operational cost savings and the exporting companies are no longer required to submit or clear each truckload individually. “We are able to load out trucks from the port of Mombasa, which was not the case before. This has increased our supply he adoption of a Single Customs Territory (SCT) in January 2014 has contributed to an volumes. We are able to pay for the cargo well in advance since there is no longer any fear of diversion of the commodity locally,” said Sam Bukenya, supply co-ordinator for Vivo Energy Uganda. The time taken to clear fuel shipments from Kisumu, Eldoret or Malaba border has been cut to eight hours from 72, besides the Ugandan suppliers being able to load fuel from Mombasa directly. Mr Bukenya said the SCT sys- tems now allow Ugandan importers to directly manage their stocks from the point of entry, which was not the case before. “We can now make decisions easily because we are dealing with the Uganda Revenue Authority, which is much faster than having the entire process managed by our Kenyan affiliate (Vivo Energy Kenya),” Mr Bukenya added. The indirect benefits of the system are being felt inland. The new hydrocarbon reserves found in the region, and a faster, more efficient mechanism for moving oil products inland, have brought in new investments in energy infrastructure. “We haven’t had fuel short- ages in Uganda for some time now as our capacity is sufficient. At any one time, our tankers are full because of our new processes. Everything is more predictable. This month, I expect Ush90 billion ($27 million) worth of taxes from fuel because I know We haven’t had fuel shortages in Uganda for some time now as our capacity is sufficient. At any one time, our tankers are full because of our new processes.” losing on truck turnaround has been reduced. We are also saving on business financing,” Mr Bukenya said. The border posts along the main arteries connecting the port of Mombasa in Kenya to the East African hinterland are notorious for their long queues and harried Customs officials. And so it was that, with each shipment, drivers and their clients lost days at Customs posts as their cargo was checked and re-checked at weighbridges. “It used to be a horrible proc- ess,” said Kassim Omar, a former truck driver and the co-chair of the Uganda National Monitoring Committee, a state body formed under the East African Customs Union to deal with complaints about trade barriers affecting traders. “The trucks had to be weighed several times within the same country while the port procedures remained inefficient and cumbersome,” said Mr Omar who also chairs the Ugandan Clearing and Forwarding Association. TradeMark East Africa Workers move containers at the Port of Mombasa. There is no more congestion at the port since the introduction of the SCT. Picture: File what is coming from Mombasa upfront,” said Dickson Kateshumba, the Customs Commissioner at URA. “It has also helped to edge out players who are selling smuggled fuel. It is now not possible for one to bring in goods such as fuel without paying.” For individual drivers and exporters, the cost of shipping has been reduced considerably. Rather than paying up to $1,000 in bond and clearing fees along the route, drivers pay $300-$400 per shipment, freeing up capital for investment in their businesses. “Everything has changed. There is less congestion at the border, and the time we were URA u≥ges Uganda t≥ade≥s to clea≥ ca≥go in Mombasa By DALTON NYABUNDI Special Correspondent UGANDA HAS urged its traders to clear cargo lying at the port of Mombasa or risk higher storage charges and possible forfeiture as managers at the key gateway facility prepare for an expected surge in shipment volumes ahead of the festive season. The Commissioner for Customs at Uganda Revenue Authority, Dickson Kateshumbwa said that 323 Uganda bound containers had not been collected from the port as at October 10. “Owners of these goods are re- quested to immediately clear the goods out of the port as delays in clearance will lead to accumulation of storage and Customs warehouse rent charges” the commissioner said . “Please note that prolonged stay may lead to the goods being deemed to have been abandoned and being disposed of through auction to create space for incoming cargo” he added. A schedule from the Kenya Ports Authority (KPA) showed that in the 14-day period to December 8 alone, the port of Mombasa is scheduled to handle 43 vessels — signifying that building traffic is building up as more shipments are made in time for the festive season. The KPA has since July come under renewed pressure to clear a fresh backlog of containers at Mombasa port following a workers’ strike that disrupted operations at the busy regional port. More than 2,000 workers went on strike over two days to protest 323 the higher deductions for the National Hospital Insurance Fund, prompting port management to fire several of them. The strike disrupted business at the port which handles imports such as fuel for Uganda, Burundi, Rwanda, South Sudan, eastern Democratic Republic of Congo and Somalia, leading to a pile up of cargo containers. The port is seen as a barometer Number of containers destined for Uganda that have not been collected from the port as at October 10. of economic activity in East Africa as it handles fuel, consumer goods and other imports for Uganda, Burundi, Rwanda, South Sudan, DRC and Somalia as well as exports of tea and coffee from the region. URA Customs officer at work. The tax body is urging Uganans to clear goods at the Port of Mombasa. Picture: File (TMEA), which works on a range of programmes aimed at facilitating trade and regional integration in the EAC, supported the three countries’ revenue authorities as they worked to harmonise their processes. Allen Asiimwe the TMEA Uganda country director says that the organisation supported Uganda Revenue Authority with an upgrade of its Customs management system, Asycuda World. The web-based system integrates with the revenue systems of Kenya and Rwanda, allowing imports to be seamlessly tracked across the new SCT corridor.
Nov 28th 2015
Dec 12th 2015