‘Industry guilty of aiding and abetting climate of corruption’

Overbearing bureaucracy, bribery and corruption are endemic across the continent. In Africa, it may be said, greed rules. But the equally sad part is that the guilt doesn’t lie exclusively with one side, as with government-appointed officials and bureaucrats. Instead, many shipping lines and transport companies and their respective agents are equally responsible by aiding and abetting the practice when they willingly go along and pay bribes that are passed off as a cost of doing business. “It’s either that or our ships wait outside a bit longer,” and “if we don’t play the game then ways are found to further delay clearing the cargo,” are just two of the reasons heard in the course of preparing this article. If this sounds like a piece of journalistic exaggeration, consider recent reports that described a strike by clearing and forwarding agents in Nigeria’s Tin Can Island that resulted not simply from bribes being taken, but because Nigerian customs officials had become greedy and were unilaterally doubling the amounts they were demanding. The fact that something above and outside the official tariff book rate had to be paid was never an issue – the Nigerian clearing and forwarding industry and their clients, the shippers, are by now well used to this and play the game as a matter of course – another ‘cost of doing business’ that is simply factored into the landed price. What the C&F agents finally took umbrage over was the barefaced greed of officials. In another recent case an editorial in a Tanzanian newspaper welcomed the news of the overturning of a monopoly at the port of Dar es Salaam, saying it believed this would bring about improvements in efficiency. The editorial added that it hoped the authorities would now turn to fighting graft and corruption within the country’s transport chain. ‘Infrastructure not the cure-all for regional competitiveness’ A lot of emphasis has rightly been placed on improving Africa’s infrastructure in its ports and railways. But it’s also been said that infrastructure is not the cure all for regional trade and competitiveness, and that governments play a crucial role and can undo any vision of a successful and competitive sub-continent through unsupportive policies and poor governance. Nevertheless, infrastructure, or its lack, remains an equally vital cog in ensuring that ports, railways, and road networks along with other transport systems are able to operate with efficiency, especially across the wider integrated regional partnership of African trading nations. A report entitled ‘Africa and the World Economy – the National, Regional and International Challenges’ presented by the Dutch research centre Fondad, points out that it costs the same to clear a 20-ft container through the port of Dakar as it does to ship the same container from Dakar to a north European port. The same report said that every day spent in customs added 0.8% to the cost of goods and that Africa had the longest delays in the world, with an average of 12.1 days across sub-Saharan Africa. For some ports those delays can amount to 30 days or more. “Excessive bureaucracy, high insurance costs, cumbersome customs procedures and outright corruption by public servants using bribes, official and unofficial checkpoints escalate transport costs in Africa,” the report stated. According to Greg Mills, strategic adviser to the Rwandan presidency and head of Johannesburg’s Brenthurst Foundation, in Rwanda about 45% of the country’s export value comprises transport and insurance costs, compared with an average of 14% for other landlocked countries. Bureaucracy the root cause of high costs and delays Mills said that throughout Africa the lack of 24 hour border operations added to the costly delays but the root cause of delays and high costs in Africa was not the shortcomings of regional routes but unwieldy bureaucracy, government policies and the simple economics of business. But Africa is of course not all doom and gloom. In recent years the continent has been facing up to its logistical challenges and has taken impressive steps to redress its infrastructural shortcomings. The sheer magnitude of infrastructural spending that is going on throughout the continent and especially in its harbours has begun to transform ports on Atlantic and Indian Ocean seaboards, although it remains a slow process. Probably at no time in Africa’s history has so much investment been made in upgrading port and terminal facilities. Yet difficulties remain. The World Bank pointed out in a paper that West Africa had 24 significant ports stretching between Mauritania and Angola, many of them placed in areas that are difficult to dredge to the requirements of modern deep-draught ships, while others like the Lagos ports are limited by their proximity to urban areas, rendering them unsuited to the needs of modern shipping. The document stated that a single modern four or six-berth port operating to the efficiency of a Far Eastern port would have the capacity to handle all of the region’s container traffic and suggested that the hub system might provide a logical solution. The other challenge facing the continent is that most of Africa’s ports are poorly equipped to take advantage of the multi-modal aspect of containers, lacking the integrated rail and road links with their hinterlands and neighbouring landlocked neighbours. This is amplified in the long dwell times experienced at many African ports, which increases the amount of congestion around the ports. Mills reported that it took a minimum of 72 hours to clear a container in Mombasa, whereas in Singapore it took a little over two minutes. Port systems have failed to keep pace with trade surge With a few exceptions most sub- Saharan African port systems have been slow in keeping up with the surge in international trade and its regulatory and technological aspects, leaving the sub-continent to lag behind other world regions. Many of the region’s ports have exceeded their design capacity and most lack the supportive logistical systems of efficient rail and road networks. Even South Africa has begun to lag in this respect. Pressure from international container operators has seen a crash course in upgrading and improving infrastructure, but institutional and regulatory reform remains slow across most regions. A number of African countries turned to privatisation as a panacea for all their logistical problems, but while there has been some success in the operation of ports, terminals and railways, the challenges of Africa are proving too great for many international operators, leading to a growing dissatisfaction with privatisation and a move by respective governments to take back the terminals and railway networks. Already a number of concessions have been cancelled or reworked. As with other parts of the world the current economic downturn is to Africa’s advantage, creating breathing space in which port and land transport reforms can be introduced and completed, although there is always the inherent danger that with the pressure relieved some of these projects may be relegated to the back burner.