Monday, 12 February 2018

Cartels take over paperless system – industry players

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Adnan Adams Mohammed

The Paperless Clearing System introduced at the ports, envisaged to streamline operations and remove bottlenecks and human interference in the clearance of goods business, seems to be hijacked by a cartel of scrupulous people who are manipulating the system for their selfish interest.

Key industry players have raised several concerns since the introduction of the new system at the ports.

It is on records that, a number of clearing agents and port officials are in the grips of the law for attempting to manipulate the system.

More to this, the Association of Ghana Industries (AGI) recently called on the government to immediately audit the paperless system.

The call for audit by AGI and other players like the Freight Forwarders, Importers and Exporters Association is to help enhance the performance of the system, improve efficiency and get it to deliver the intended results.

Revealing further the severity of the alleged compromise of the paperless system is the words of Dr Oteng-Gyasi, Chief Executive Officer of Tropical Cable and Conductor, “it now looks like the paperless system is being badly undermined.”

“It looks like there are forces; influential and a few bad lots in there are interfering with the system and I think that they must be so powerful and influential to be able to affect importation business this much,” he added.

Dr Oteng-Gyasi, a former President of AGI also supported the call for immediate audit of the system, emphasizing that, it is necessary due to the involvement of people in the operations of the system, leading to its inability to deliver.

The involvement of these powerful people and institutions, he said, have made it possible to flood the Ghanaian market with cheaply priced imports, resulting in the demise of local manufacturers.

Dr Oteng-Gyasi said, AGI was prepared to present evidence of these malpractices to the Ghana Revenue Authority (GRA) and the government for action.

According to him, once the importers were able to under-invoice, declare or mis-describe their goods, they were able to escape payment of actual duties, resulting in revenue loss to the state, as well as emboldened the importers to under-price their goods.

Dr Oteng-Gyasi made these revelations during an interview with Accra based media firm when he spoke on the frustrations of local manufacturing companies in the hands of fraudulent trade practices, stressed on how trade malpractices, including under-invoicing, declaration and mis-description of imports had led to the demise of domestic manufacturing businesses.

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However, after five months of the implementation of the paperless system, the implementing agency Ghana Revenue Authority (GRA) has disclosed that it is preparing to take a holistic review of the system automation and paperless operations at the Tema and Takoradi Ports.

The Customs Division of GRA admitted that it had identified areas with challenges and willing to address it in other not to disrupt revenue mobilization.

Deputy Commissioner in charge of Policy and Programmes at the GRA, Patrick Yawutse in an interview noted that the review is very critical to the success of the programme.

He said, “Honestly speaking, the delays should not be acceptable and therefore we must be honest to accept that people have challenges there and then we have to improve and also look at compliance as well."

Patrick Yawutse said, “Where we are having our biggest challenge is examination…But the good news is that management has approved that we should review the project.”

He said, “We should be starting next week... The request has been approved, the project evaluation outline has been completed. We will look at the key areas where we have very difficult problems; that will be the first stage that we will tackle.”

“We will look at the more difficult areas as a [way] of review and do the reorganization.”

According to the Deputy Commissioner, “The review should take one week.”

Consequently, while admitting that not all persons along the importation value chain were involved in the practice, Dr Oteng-Gyasi said, the actions of “the few bad lots” were so profound that they were dictating the fortunes of local manufacturers, including those in the electrical cable and conductor business.

“The paperless system was supposed to bring efficiency in port operations by clearing and forwarding of goods. What it meant simply was that once you file your entry, it went through the system without someone having to chase it.

“However, when you have an illegality in your documentation such as mis-description, under-valuation or under-invoicing, then the system will hold your documents and that is when the importers will try and see a custom officer, negotiate and get their way out,” he said.

This hold-up of faulty documents resulted in some importers complaining of delays in the implementation of the paperless system.

“If there are delays, it is because you have submitted the wrong entries. With the new system, you don’t even know which customs officer is working on your documents and so if there is a problem, it is flagged and sent back. Sometimes, they do the correction with the right values but when the importers, who are used to getting away with little duties, see this, then they start agitations that the system is not working.

“But why is the system not working? I am one of the biggest importers; all my raw materials such as copper are imported but why am I not complaining?” he quizzed.

Meanwhile, he is hopeful that the government would take action to help create a level playing field for imports and locally manufactured goods to compete.

In May 2017, the Vice President, Dr Mahamudu Bawumia gave directives at a port efficiency conference.

The directives included the removal of all customs barriers on the country’s transit corridor, a joint inspection by all regulatory agencies at the ports and a hundred percent paperless transactions at the ports.

He followed up with an official road map of the paperless process flow to guide the operators and agencies in the port clearance chain.

Dr Bawumia claimed that an initial assessment of the implementation has shown a revenue collection improvement of 56 percent.

According to him, revenue at the ports increased from GHC130 million in the first week of September 2016, to GHC 213 million in the same period for 2017.