Harmonisation bears fruit

Customs clearance has seen major progress since a single system was put in place in southern Africa, writes Benedict Young

Only three years ago, in was not untypical for a container passing through Namibia’s main container port, Walvis Bay, to be held up for three days before clearing customs. Namibia’s role as a port of entry for landlocked countries such as Botswana meant that an array of regulations and customs regimes had to be observed.

Today, customs clearance has been reduced to 15 minutes, following the introduction of a Single Administrative Document (SAD) system, established under the legal framework of a Memorandum of Understanding between Namibia, Botswana and South Africa.

"All three customs regimes agreed to work together to accept a one-page document to transit two or three border posts," says Jerome Mouton, strategic business development manager at Namibian Ports Authority (Namport). "There were a number of legal aspects involved, as every country has its own laws regulating customs. The first process was to harmonise the legal requirements between the countries."

This process was made easier by the fact that the three countries were already part of the Southern African Customs Union (Sacu), which originally came into force in 1970 with the aim of maintaining the free interchange of goods between member countries.

Nonetheless, implementing the SAD took nearly three years to accomplish. "For us to harmonise the customs requirements was technically easy, but practically was not so straightforward," explains Mouton. "There were various timeframes for different parliaments, different customs regimes and different director generals."

The system has now been operating for around three years and Namport says it is running extremely smoothly. SAD works in a very similar way to its namesake in the EU, but unlike the European version, it has not sparked an outcry over technical compatibility issues.

"For us, it’s still a paper-based system because Botswana and Namibia use the same customs clearance system, Asycuda, which was designed by UNCTAD," says Mouton. "South Africa has its own computer system for that, so in Namibia and Botswana you can frame your customs entry electronically via EDI. In South Africa you can also do it via EDI but they’ve got a different system."

According to Mouton, the principal of the customs clearance system can be applied anywhere and can offer real benefits that facilitate trade. Reducing customs clearance from three days to 15 minutes has had a significant impact on business growth for Namport. "The Single Administrative Document has had a huge impact on our corridor, particularly on the trans-Kalahari," he says. "It will also impact on the trans-Caprivi, because we are going to roll out the same system with our neighbours in Zambia, as well as to the DRC, Zimbabwe, and Angola. "We have to go through the same process with these new countries, but we’ve learned all the pitfalls. So the process will be much faster and won’t take three years this time."

In the case of Zambia, Mouton is confident that the process will be made easier and quicker due to the two countries both being part of the Commonwealth, though he acknowledges that they each have two different sets of customs regulations that must be harmonised. "Angola is a different kettle of fish because they use crown agencies, and we expect that to take a bit longer," he says.

As a result of the SAD system, dwell times at Walvis Bay container terminal average a maximum of three days, compared to the 14 days typical for the region. Although the port handles volumes of only around 120,000teu per year, Namport is gearing up for year-on-year growth of 25-30% for the next few years.

As well as streamlining customs clearance procedures, the state-operated container terminal has been expanded, in terms of infrastructure and equipment, to accommodate the anticipated growth. In addition to increasing the fleet of mobile harbour cranes to three, a new paved container stacking area has been completed, and further developments are planned within the next seven years as part of Namport’s port master plan.

So far, these developments have been financed off the balance sheet from port revenues, though Mouton admits that some sort of outsourced financing is likely to be required at some point in the future.

Namport is keen to resist the lure of private investment through a concessioning off of terminal operations, but Mouton confirms that the authority is now considering joint ventures with private companies that would bring in working capital and operational expertise. cs