Archives For May 2014

containerThe Maritime Safety Committee (MSC) of the IMO has approved changes to the Safety of Life at Sea (SOLAS) convention that will require verification of container weights as a condition for loading packed export containers aboard ships.

Misdeclared container weights have been a long-standing problem for the transportation industry and for governments as they present safety hazards for ships, their crews, and other cargo on board, workers in the port facilities handling containers, and on roads. Misdeclaration of container weights also gives rise to customs concerns. The approved changes to the convention will enter into force in July 2016 upon final adoption by the MSC in November 2014. In order to assist supply chain participants’ and SOLAS contracting governments’ implementation of the container weight verification requirement, MSC also issued a MSC Circular with implementation guidelines.

MSC also approved a new Code of Practice for the Packing of Cargo Transport Units (CTUs), including intermodal shipping containers. The new CTU Code, which will replace the current IMO/ILO/UNECE Guidelines for packing of CTU, has already been approved by the UNECE (United Nations Economic Commission for Europe) and will now go to the International Labour Organization (ILO) for approval. The CTU Code provides information and guidance to shippers, packers and other parties in the international supply chains for the safe packing, handling and transport of CTUs.

Of particular interest for regulatory authorities is Chapter 4 – “Chains of responsibility and information” which deals with the parties responsible for the provision of information and other security and regulatory requirements concerning containers as they are transported across the supply chain.

The World Shipping Council (WSC), whose members represent about 90 percent of global containership capacity, has been a leading advocate for the container weight verification requirements and has worked cooperatively with the IMO for over seven years to see them materialize. WSC has also participated in the group of experts that developed the new CTU Code.

“In taking these decisions, the IMO has demonstrated its continuing leadership in trying to ensure the safe transportation of cargo by the international shipping industry,” said WSC President & CEO, Chris Koch. “We congratulate the IMO Secretary General and the IMO member governments for developing and approving these measures that, when properly implemented and enforced, should provide for long-needed improvement to maritime safety. The SOLAS amendments and related implementation guidelines regarding container weight verification represent a collaborative effort that we were pleased to be a part of and we look forward to final adoption of the amendments in November 2014.”

The new CTU and supporting material can be accessed at the UNECE website here. Also See the World Shipping Councils webpage here for chronological information about the container weighing issue. Source: Maritime Executive

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South African Port Hanbook [SAOGA]Following a successful SAOGA (South African Oil & Gas Alliance) has launched the second edition of the South African Port Handbook at the Offshore Technology Conference in Houston during the first week of May 2014. The book is available in a user-friendly .pdf format on the internet. To view the online version in an e-book format please click the hyperlink – SA Port Handbook. For a downloadable (.pdf) version of the book please visit SAOGA’s website.

Residents transfer money using the M-Pesa banking service at a store in Nairobi, Kenya

Residents transfer money using the M-Pesa banking service at a store in Nairobi, Kenya

Nine mobile network operators across 48 countries in Africa and the Middle East have joined forces on the GSM Association’s Mobile Money Interoperability (MMI) program. The program aims to develop standards and implement convenient and affordable financial services across the regions, where many citizens have limited access to traditional banking services.

Mobile money transactions in Sub-Saharan Africa and the Middle East totaled US$5.7 billion last year, and more than a quarter of Kenya’s economy now flows through groundbreaking service M-Pesa – which has been adopted by 56 percent of Kenyans since its introduction by Vodafone and Safaricom in 2007 – without touching a bank account. (Comment: over time, me thinks cross-border enforcement authorities will scrutinise such schemes).

But while Kenya stands as an exemplar of mobile money, far ahead of even the US in usage of payments through a mobile phone, other countries have been much slower to adopt the model – thanks in part to regulatory challenges that hold back innovation. There’s hope that this MMI program will accelerate growth through collaborative development of best practice guidelines, regulatory support, performance benchmarks, and interoperability between services.

It could have widespread implications, as an estimated 1.7 billion people in lower to middle income countries own a mobile phone (primarily with prepaid credit), yet currently lack access to the financial services taken for granted in the developed world. Mobile money is now available in most developing markets, although the 2013 GSMA Mobile Money for the Unbanked State of the Industry report indicates that services tend to be limited outside of East Africa.

That’s where MMI comes in. The initiative is meant to connect mobile network operators with banks, governments, and other partners in a bid to allow access to more mobile financial services for a broader range of people. This would provide a means for them to take out insurance, invest in savings accounts, make and accept payments, and send money across borders.

Explosive growth in the field has seen mobile money accounts outnumber bank accounts in nine African markets, with 98 million registered and over 60 million active in Sub-Saharan Africa as of June 2013. Competition is also growing – 52 countries (36 of which are in Sub-Saharan Africa) have at least two mobile money services, and 27 of those have three or more. This could lead to accelerated innovation, but without interoperability it will devolve into a total mess.

Figure from the GSMA 2013 State of the Industry report on mobile money for the unbanked showing the number of registered and active mobile money accounts by region.

Most existing mobile money services act as closed-loop systems wherein electronic money must be converted to cash before it can be sent to someone on another mobile money service. But cooperation within and across regions should soon see these kinds of barriers disappear in favor of interconnected schemes that seamlessly (no doubt with some transaction fees) transfer funds from one service to another at the press of a button.

“Mobile money is a young industry, with over 80 percent of all deployments launched during or after 2010,” said GSMA Director General Anne Bouverot. It’s a field under rapid, enthusiastic, unparalleled growth, and it falls now on the signees of the Mobile Money Interoperability program to steer the ship to safe waters as mobile money races toward ubiquity across all of Africa and the Middle East. Source: GMSA

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Port of Antwerp [Picture -  Porttechnology.com]

Port of Antwerp [Picture – Porttechnology.com]

Port of Antwerp has issued its 2013 Annual Report which contains an interesting ranking of the largest ports worldwide.

According to the Port of Antwerp, throughput figures of different ports cannot be compared as ports do not use uniform definitions: some ports (most importantly Singapore) apparently use freight tons (metric tons or volume tons, whichever is higher).

According to Antwerp’s estimates, Singapore handles slightly more than 400m tons, instead of the 560m tons reported by the Maritime and Ports Authority of Singapore. However, their ‘correction factor’ may not be accurate.

Port of Antwerp’s definition of throughput is focused on ‘international throughput’. That is a debatable definition, as it leads to the exclusion of domestic traffic by seagoing vessels. For this reason, and partly because the Chinese ports apparently also include barge traffic in total volumes, the Chinese ports of Shanghai and Ningbo are substantially smaller in Antwerp’s figures than in their own statements.

So, surprisingly, the largest port of the world according to Antwerp’s annual report is Rotterdam! This goes to show that their effort is not intended as a marketing effort to favour Antwerp. If that was the case, they could have taken the port area to identify the largest port. This indicator puts Antwerp firmly on top as Europe’s largest port, with about 13,000 hectares, compared with Rotterdam’s more than 10,000 hectares. But clearly, the port area is an indicator of limited value, both due to differences in the definitions and for its limited relevance.

The Antwerp ranking does demonstrate the variety of definitions used in measuring port throughtput. For instance, in Europe ports throughput numbers do not fully match with Eurostat’s throughput data. This variety of definitions does not only apply to throughput, but also for other indicators such as modal split and employment in ports. That hampers international comparisons, benchmarking as well as academic research.

An authorative effort to create global standards would be good news for the port industry. Source: Porttechnology.com

eabc-flagsThe East African Business Council, the umbrella body of the region’s private sector, has asked governments in the five-member East African Community (EAC) to expedite implementations of the new WTO trade facilitation agreement.

Council chairperson, Felix Mosha, made the appeal on Tuesday during a breakfast meeting with trade facilitation institutions and the business community in Arusha, Tanzania.

WTO members in December 2013 adopted the Agreement on Trade Facilitation during the Ninth Ministerial Conference in Bali, Indonesia after 10 years of negotiations. The Bali deal aims at boosting poor countries’ ability to trade and allow them more flexibility in food security. The agreed text is currently under review by legal experts and will come into force once two thirds of the 159-member World Trade Organisation accept it.

Trade and Industry minister, Francois Kanimba, told The New Times that implementation of the agreement cannot be done immediately because WTO is yet to give member countries the requisite legal implementation modalities.

“By July, we’ll have got it, so that the process can start,” Kanimba said. He added that Rwanda, after a recent self-assessment on how it stands on the implementation road map, realised most requirements had been attained.

Steps made in facilitating cross-border trade such as the ongoing EAC one-stop border posts, and the 2012 launch of the electronic single window system, were some of the steps taken by Rwanda.

Benefits

“Everything, by nature of trade facilitation is always good. The trade balance for Rwanda is negative and if the Bali agreement helps us improve, it will help us address our development challenges,” the minister said.

“Rwandan traders will also benefit as trade facilitation is about easing things for them. For example, improvements in communication will ease access to vital information they need in different member countries and this will enable many to conduct trade more efficiently.”

With the agreement, WTO members established a new legal framework that fills gaps in the existing General Agreement on Tariffs and Trade (GATT), in effect since in 1947. The new agreement stipulates obligations and provisions on special and differential treatment for developing and least developed country members as well as the provision of technical assistance and capacity building. Obligations include publication and access to trade related information, appeal procedures, simplification of trade procedures and goods clearance processes, agency cooperation, as well as cross-border customs cooperation.

Calling for the “swift” implementation the WTO Bali Agreement on Trade Facilitation, Mosaha said: “This will go a long way in lowering transaction costs, enhancing competitiveness of the businesses as well increasing intra EAC trade”.

Mosha said that while some progress had been made in ensuring free movement of goods, persons, labour, services and capital, challenges continued to constrain full realisation benefits from integration. Among them he cited 33 non-tariff barriers, non-recognition of the certificate of rules of origin, additional taxes and charges and lack of harmony in domestic tax regime such as excise duty, VAT and income taxes. Source: The New Times.

Heads of Customs Governing Council for the ESA Region with WCO Secretary General Kunio Mikuriya

Heads of Customs Governing Council for the ESA Region with WCO Secretary General Kunio Mikuriya

At the invitation of the Vice-Chair of the East and Southern Africa (ESA) Region, Mrs. Agnes Katsonga Phiri, Commissioner of Customs and Excise, Malawi, the Secretary General, Mr. Kunio Mikuriya attended the 19th Meeting of the Heads of Customs Governing Council ESA Region, on 15 and 16 May 2014. The meeting was hosted by the South African Revenue Service (SARS) in Johannesburg.

The Commissioner of SARS, Mr. Ivan Pillay welcomed delegates from the Members of the Region on the 20th Anniversary of democracy in South Africa, a period during which much had been achieved. He highlighted the importance of the WTO Agreement and its impact on Customs and the growth in African trade.

Addressing the Governing Council, the Minister of Finance, Mr. Pravin Gordhan emphasized the evolving role of Customs in a changing and challenging environment. The continued growth of economic activity in Africa required innovative Customs procedures to secure and facilitate trade, particularly in the context of regional integration. The WTO Agreement on Trade Facilitation (ATF) offered a golden opportunity as Customs would have a central role in its implementation. Customs must continue to enhance its operational capacity by increased automation, embracing other agencies and harmonization and simplification of procedures. The importance of Capacity Building was emphasized.

Secretary General Kunio Mikuriya gave a comprehensive report on recent WCO activities. He referred to the many developments on the WTO ATF agenda. The WCO had established a web tool dedicated to this topic, including an analysis of the ATF Articles and relevant WCO instruments with a self assessment aspect. Mr. Mikuriya recalled that the WCO theme for this year is “Communication” and asked all Members and agencies present to ensure that all were aware of each other’s activities.

Secretary General Mikuriya also met with the Minister of Finance, Mr Pravin Gordhan, to discuss a number of issues of mutual interest including implementation of the ATF, information exchange and the evolving role of Customs. The Governing Council discussed the way forward as regards ATF implementation, and expectations of trade input to WCO activities. Source: WCO

Avenida Marginal, Luanda, Angola

Avenida Marginal, Luanda, Angola

The current activity conducted by forwarding agents is not only limited to inter-mediating the foreign trade or deal with the clearance of goods at customs ports, said Tuesday the economist Osvaldo Luis da Silva.

Speaking to ANGOP on the role of forwarding agents in domestic economy, the economist spoke of the need for the agent to know the entire services chain of operators with whom they work. He stressed that the forwarding agents facilitate, through the service they provide, the relationship of importers and exporters with customs, tax offices, notaries, banks and other entities.

It is also their responsibility to observe and enforce the administrative requirements and law. On the other hand, said the expert, the forwarding agent is a guide or customs consultant for operators, who acts in the field of import and export and plays an important role in the economy.

He noted that these professionals have contributed to the increase in customs revenue and encourage the observance of customs procedures by operators engaged in import and export activity. Osvaldo Luis da Silva underlined that the Angolan Government updated the Customs Tariff to promote domestic production and sustainable economic development of the country.

The entry into force of this law does not cause any inconvenience to the work performed by the forwarding agents, he said. On the other hand, added the economist, the law has come at a good time and is satisfactorily facilitating their work. Source: Angola Press Agency

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Australian Border ForceThe Australian Government has announced changes to the immigration and border protection portfolio in relation to future border protection arrangements.

From 1 July 2015, the Department of Immigration and Border Protection and the Australian Customs and Border Protection Service will be consolidated into a single Department of Immigration and Border Protection. At this time, the Australian Border Force, a single frontline operational border agency, will be established within the department.

The Australian Border Force will draw together the operational border, investigations, compliance, detention and enforcement functions of the two existing agencies. Policy, regulatory and corporate functions will combine within the broader department.

The name, in itself, marks a distinct shift in world customs operation. Unless I’m mistaken, it’s the first customs and border authority called a ‘force’. The demise of traditional ‘Customs & Excise Departments’ in the wake of 9/11 appears set to continue as sovereign states seek new ways to combat cross-border crime. There is in reality no ‘bench mark’ nowadays. Developing countries tend to favour the revenue authority model (as dictated by their sponsors) – mainly due to the fact that customs revenue remains a critical component of their economies. Developed countries are migrating in ever-increasing number to border agencies with more focus on security issues.

For more information about the changes, read the Minister for Immigration and Border Protection’s speech announcing the new arrangements on 9 May 2014 and the Australian Border Force booklet.

Source: Australian Customs Service

Northrop Grumman and Yamaha Motor Corporation, USA, are teaming up to develop a small, unmanned autonomous helicopter system. The Rotary-Bat (R-Bat) is aimed at a range of applications in both urban and rural areas, including search and rescue, power line inspection, border patrol and forest fire observation.

Although Yamaha might be better known for outboard motors and ground-based transportation of the two-wheeled variety, it has been producing remotely-piloted unmanned helicopters for over 25 years. Its RMAX unmanned helicopters have been dusting Japanese crops for over 20 years and have recently been studied for potential use in US agriculture.

It is Yamaha’s RMAX platform that the R-Bat helicopter will be based upon, while Northrop Grumman will supply the aircraft’s autonomous control systems and sensors. Its name signals that it will join the ranks of Northrop Grumman’s existing line of Bat unmanned aircraft systems (UAS) that are used for tactical intelligence, surveillance and reconnaissance applications.

Neither company has released technical details of the R-Bat, but being based on the RMAX it should follow that vehicle’s measurements of 2,750 mm (9 ft) long (3,630 mm (11.9 ft) with the rotor), 730 mm (2.4 ft) wide and 1,080 mm (3.5 ft) high.

A test flight of the R-Bat unmanned helicopter system can be seen in the following video. Source: Northrop Grumman

made_in_south_africa___barcode_and_flag_by_netsrotj-d5cmbq9Export taxes are increasingly becoming a focus of attention in South African trade policy, and the objective of this paper is to review the trade and economic issues associated with these taxes. While they are similar to import tariffs in their effects, export taxes remain very much the ‘poor cousins’ of import tariffs in trade policy circles. While attention is paid to them in many bilateral and regional agreements, the multilateral World Trade Organisation (WTO) has little to say about them other than an awakening to their importance when it comes to negotiating a new member’s accession to the world body.

South Africa currently levies an export tax on unpolished diamonds in an attempt to develop local skills and promote the domestic industry, and it is considering a recent department of trade and industry report that recommends that consideration be given to an export tax on iron ore and steel. South Africa has some of the prerequisite market power in the global iron ore trade but not enough to ensure an outcome entirely beneficial to its export trade. The salutary example of South Africa’s competitor India is discussed, as India recently increased its export tax in this sector to 30% and has seen its global market shares plummet. The more interesting sector for South Africa is the ferrochrome and ferrochrome ore trade, as here South Africa does have significant market shares. South Africa has had about a 45% market share over the last three years in global exports, while China has imported around 70% to 85% of this global trade in recent years. Advocates argue that a tax on chromite ore exports will shift the relative economics back to empower South African producers of processed ferrochrome. This sets the stage for an interesting battle between South Africa and China, and one set against the background of South Africa’s recent admission to the BRICS club. If such an export tax is invoked, South Africa needs to be conscious that it at best provides a window of opportunity for the domestic sector to improve its technological efficiency and that it is not a long or even medium-term solution.

For an in-depth appraisal on export tax in South Africa, please read Ron Sandrey’s report “Export tax in the South African context

Source: Tralac & Author -Ron Sandrey

WCO Trade Facilitation Implementation Guidance 1The World Customs Organization (WCO) has launched on its website the WCO Implementation Guidance for the World Trade Organization (WTO) Agreement on Trade Facilitation (ATF) to support WCO Members in their efforts to implement the ATF.

The Guidance presents the importance of WCO instruments and tools such as the Revised Kyoto Convention for ATF implementation.

The Guidance contains the following categories of information for each ATF Article:

  • Overview
  • Text of ATF
  • Relevant RKC standards and RKC Guidelines
  • Other relevant WCO tools
  • Member practices
  • Performance indicators

The Guidance will be updated on a regular basis and a French version will be released shortly.

Source: WCO

Inter-Departmental CooperationSouth Africa’s first maritime port of entry control centre represents a milestone in the country’s journey to secure, modernise and control its borders, Finance Minister Pravin Gordhan said at the opening of the centre at Cowrie Port in Cape Town harbour last week on Friday.

The centre puts all the government departments and agencies involved in immigration and border control under one roof. These include the departments of home affairs, health, agriculture and fisheries, the SA Police Service (border police and crime intelligence), and the SA Revenue Service (Customs). The state-of-the-art centre would not only improve security and immigration issues, but would also serve to enhance trade and South Africa’s status as a logistical gateway to Africa, Gordhan said.

Trade

The rationale behind the centre was in line with the National Development Plan, the minister said. Among other things, the NDP aims to stimulate growth by lowering the cost of doing business in South Africa, improving the country’s competitiveness and exports, and linking local products with other emerging markets. Gordhan said the fast-growing markets of Africa represented important new markets, and the NDP was committed to increasing South Africa’s trade with its regional neighbours from 15% to 30%.

‘Complex borders’

Home Affairs Minister Naledi Pandor, also speaking at Friday’s opening, said the centre had been designed “to accommodate in one spot not only customs, excise and immigration, but also health, safety and intelligence.

“Ports are complex borders to manage. Cowrie Place will provide the space and facilities to manage passengers and cargoes more efficiently than before.” Pandor said the government hoped to establish a border management agency by the end of 2016, taking advantage of the lessons learnt from Cowrie Place. A flagship feature of Cowrie Place is the co-ordination monitoring centre, where the data and information will be fed, assimilated and made available to all government department and agencies involved in the maritime border management.

“For the bona fide tourist or member of the trade community, this will mean better service,” Gordhan said. “For those who intend to challenge the laws of our country, be warned, as we intend to raise the bar of compliance by an order of magnitude.”

Important port

Cape Town’s port is oldest in South Africa, but despite changes to its maritime culture brought by air travel and containerisation, it is still an important point of entry. The port processes more than 870 000 containers as well as nearly 730 000 tons of dry bulk per annum, Pandor said.

A total of 6 173 commercial vessels and 55 passenger vessels entered and/or left the port in 2013, while more than 62 000 people entered and/or departed from Cape Town harbour. Pandor said E-berth at the harbour would be developed into a fully fledged passenger liner terminal to complement Cowrie Place.

PAUL-KAGAME-WINDOW-SYSTEMPresident Paul Kagame yesterday launched Kenya National Electronic Single Window System seen as a major boost for regional trade since it will simplify clearance processes of goods.

The launch was part of the activities of the 5th Northern Corridor Integration Projects Summit held in Nairobi, and was attended by Presidents Kagame, Uhuru Kenyatta of Kenya and Yoweri Kaguta of Uganda, as well as the second vice president of Burundi and Tanzania’s prime minister.

Rwanda, Uganda and Kenya – which heavily rely on the Kenyan port of Mombasa – are spearheading a series of joint projects aimed at fast tracking regional development through joint infrastructure, trade and political and economic integration.

The use of Electronic Single Window System is expected to centralise trade services such as tracking of goods, custom clearance, and electronic payment including through mobile money.

The system will also integrate with Kenya Revenue Authority, making the clearance at Kenyan ports a lot faster and easier.

“I just want to reiterate how this is one of many important projects that the East African Community partner states have undertaken to deepen integration that we have been seeking, make business more efficient, and lower the cost of doing business as we move forward,” Kagame said at the launch.

Making tech tick

He reiterated Rwanda’s “continued active participation towards making integration a reality.” President Kenyatta and his deputy William Ruto described the Single Window System as yet another building bloc in the EAC integration process.

“Our ultimate vision should be to implement an EAC Regional Single Window platform. The benefits from this initiative may not be fully realised unless all of us in the region adopt National Single Window Systems.

“Our brothers in Rwanda are already implementing a Single Window System and similar efforts are underway in Tanzania and Uganda,” Kenyatta said.

The Kenyan leader said the technology will make it possible for traders to submit information about their goods to multiple government agencies in multiple locations, making business faster and more efficient.

After the launch of the Kenya National Electronic Single Window System, also known as Kenya TradeNet, the Heads of State and Government discussed the progress of several other projects under the Northern Corridor initiative. Source: AllAfrica.com

Africa_Road_Corridors_HandbookAs countries across Africa gear themselves towards growing and stimulating inter-regional trade, the transport corridors being developed across the continent are important passageways for the movement of freight.

Though the growth and development of rail across Africa is in the pipeline over 80 percent of all freight being transported is on road.

Transporting goods on trucks is an expensive business. Africa can be challenging at the best of times due to non-tariff barriers even though governments across the continent are trying to make it easier for the flow of goods from one country to another.

The logistics of transporting freight can be a harrowing and expensive exercise.Especially if a transport manager is not armed with key and pertinent information – regarding the route, border posts, costs, relevant documentation required at borders, waiting times at the border posts, location of wellness centres,road conditions and where the tolls and weighbridges are situated.

3S Media in association with FESARTA have released the Africa Corridors Handbook which gives transport and logistics managers all the key information they need before drivers embark on a journey.

Having the correct information on hand is critical for every transport operator that is moving freight across Africa and now it is available in one concise handbook. Click the following hyperlink to purchase the book.