Reducing demurrage and detention remains our priority – Shippers’ Authority

To address the long-standing issues of demurrage and detention (D&D) faced by the shipping community, an exigent call has been made for a continuous conversation on the subject geared towards a plausible solution.

“As a priority, feasible measures are required to reduce demurrage and detention (D&D) payments at the country’s ports”, the Tema Branch Manager of the Ghana Shippers’ Authority (GSA) Mr. Charles Darling Sey indicated.

Addressing participants at a Demurrage Seminar convened by the GSA in Tema on December 13th, 2023, Mr. Sey highlighted among other explored strategies stating that, the GSA is committed to continually educating importers on practicable methods to evade D&D payments.

He emphasized that D&D is an avoidable cost, and the campaign to reduce yearly payments will persist until positive outcomes are realized.

Demurrage and Detention refer to fees imposed by shipping companies when cargo containers are held for extended periods beyond the agreed time frame at ports or in warehouses.

These additional fees may accumulate and have a significant impact on the profitability of companies involved in global trade.

GSA’s data indicated a decrease in estimated demurrage payments from USD 76 million in 2017 to USD 27 million in 2019, and a further drop to USD 19 million in 2021.

The decline was attributed to sensitization campaigns and government initiatives like the Paperless Port Project and pre-arrival declaration on the ICUMS platform.

The steady decline gave way to an increase of USD 24 million in 2022 due to exchange rate differentials between the Ghana cedi and the US dollar.

Participants from the shipping and logistics sector enumerated challenges leading to D&D payments and urged the GSA, the Customs Division of the Ghana Revenue Authority, and Shipping Lines operating in the country to establish favorable working conditions to support the trading public.

A representative of the Ghana Institute of Freight Forwarders, Mr. Romeo Frimpong cautioned that inefficient systems may only result to transferred D&D payments to consumers by shippers incessantly.

He also advocated for the use of digital platforms to streamline processes.

Assistant Commissioner of General Duties at the Tema collection, Madam Theresa Potakey, encouraged shippers to report challenges to her office and for prompt attention.

She clarified that while GRA is committed to collecting all taxes belonging to the state, there are no intentions to obstruct shippers.

Chairman of the seminar and Head of Freight and Logistics at the GSA, Mr. Fred Asiedu-Dartey, stressed the need for consistent and deliberate efforts to address the D&D menace.

He added that engagements with players in the sector would follow to tackle some of the challenges expressed by freight forwarders and shippers.

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