Import verification would outlaw customs fraud

South Africa’s lack of a verification system for its imports is costing the country dearly – not just in terms of money, but also in the quality of goods. According to Stefan Sakoschek, chairman and CEO of the Global Inspections Group, the importance of the verification of imports cannot be under-estimated. “We essentially started our business for that exact reason. It is extremely important for a country to verify what it is bringing in.” And this is not just important from a standards point of view but also from a revenue perspective. “An example is that someone can bring in second-hand clothes and declare them to Customs as rags. He therefore pays no import duties and because the shipment is not verified it will in all probability go through. The reality is that that very same shipment of rags is going to make money and the country has not made a cent out of it.” He said because South Africa had no verification of imports system it was easy to systematically under-declare goods. It is an issue that has been brought up by unions in the country, with the Congress of South African Trade Unions (Cosatu) leading the pack. The union has maintained its position that cheap imports of low quality and standard threaten South Africa’s manufacturing industry and will ultimately result in further unemployment. In a statement earlier this month, the National Union of Mine Workers (Numsa) said statistics showed South Africa imported more than 80% of what successful economies export. According to Numsa, South Africa should be following a ‘Proudly South African Buy-Local Campaign’ while at the same time increasing its tariffs and raising import duties. Various African countries, including Uganda, Kenya and Tanzania, have implemented a pre-verification of imports system to ensure that they are receiving quality goods at all times. “An import verification system can also assist ministries of finance in collecting the right amount of customs duties, which can run into the billions. Perhaps this is a solution for South Africa to counteract our trade deficit?”