Liberia: Pre-shipment Inspection Abolished

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The second-round of talks organized by the Business Climate Working Group has concluded in Ganta, Nimba County with the Ministry of Commerce and the Liberia Revenue Authority agreeing to abolish Pre-shipment Inspection (PSI), while participants proffered suggestions that would improve the country’s business environment. Stakeholders could not however reach a deal on the elimination of Import Permit Declaration (IPD).

Thematic issues such as expanding the port systems, port operations for effective service delivery, revenue generation and payments, relevance of import and export permits, border patrol, check points and anti-smuggling as well as the role of digital economy in enhancing cross borders trade were discussed at the business forum.

During the presentations and discussions sections, participants were asked to focus mainly on finding solutions as oppose to constantly over stating the problems. Participants called on the responsible authorities to among other things increase the port operating hours to allow more containers to leave the port.

Aside for the APM Terminals, the banking and the NPA close between 2pm and 5 pm respectively. Once the operation time is extended, more containers will leave the port and the extra charges by port authorities and trucking agencies will be avoided.

The Ministry of Commerce and the LRA have agreed to do away with the Pre-shipment Inspection (PSI) and deal only with Direct Inspection. According to Customs brokers, PSI was posing too much challenges and expenses for importers including delays on the part of BIVAC to provide inspectors on time.

The decision to remove the Import Permit Declaration (IPD), could not be resolved. Commerce Minister Wilson Tarpeh noted that the IPD was essential in regulating goods that are imported and exported out of the country and that it was based on international best practices. Other participants noted that IPD should only be restricted to security related goods coming into the country.

Delegates also called on government to ensure APM Terminals abolish the 10% increase in port or containers handling charges. With the rising cost of living including increase in prices of goods and services, an addition increase in the service charge will affect the end users or consumers, participants noted. However, as it stands, the APM Terminals noted that the 10% increase is a part of the concessional agreement with the government of Liberia.

There was also a recommendation to increase the number of days a container can stay in the port time from five to seven days. Few years ago, the number of days was 21 and was reduced to 14 and then to 5 days by the APM Terminals. There are indications that it will be reduced to only three days. Importers believe that the time is insufficient to clear a container out of the port and that seven days will give them additional time to go through most of the processes involved. According to statistics, the average time for container to stay in a port is 20 days.

On the issues of the Container Tracking Number (CTN), participants mainly importers noted that it lacks clarity and was an imposition of more charges to them. Cargo handling agency according to them are already providing tracking numbers for us they noted. But the NPA noted that this was not the same as revenue generated from tracking numbers from shipping lines were not coming into government revenue hence the need for government to take charge. In spite of the information provided, participants want the NPA to provide more information before fully launching the CTN program.

Mr. Antoine a business man (Soguipah Rubber Company) based in Guinea noted that Liberia stands a better chance of generating more revenue from transshipment, especially through Guinea and Mali. He noted that on average, his company ships 14 containers monthly out of the Freeport of Monrovia, but that could be increase to 56 or more containers on a monthly basis. Mr. Antoine noted that there were lots of other companies near the border with Liberia that want to ship through the Freeport but the high taxes is the major problem. The LRA noted that it charges 2.5% as transshipment fees and will look into the economic implications of a reduction in the rate.

The proliferation of check points in and around the country was also stressed. Participants noted that the increase in the number of checkpoints were posing serious constraints for people trading across borders. According to the World Bank, it takes more than 32 hours to take a cargo truck from the Freeport of Monrovia to the Liberia-Guinea Border. But Immigration boss, Hon. Nebleh noted that the increase in the number of checkpoints, especially during the night hours was illegitimate and needed to stop. He noted that there are 171 border points in Liberia and that only 45 was manned by immigration officers and that the LRA was only present at 18 port of entries. With this information, participants noted that there was a need for the LRA and Customs Officials to coordinate in generating government revenue while at the same time protecting the countries borderlines.

The two day meeting was climaxed with a visit to the Liberia-Guinea border. There, the team headed by the Minister of Commerce, Hon. Wilson Tarpeh had a frank exchange with immigration and military personnel of that sisterly country. Assurances of mutual respect and cooperation in peace and security and trading across borders were assured by delegates of both countries.

Participants attending the forum were drawn from both the private and public sectors of the country to include the Liberia Chambers of Commerce, Liberia Business Association, PATEL, Cross Borders Women Association, APM Terminals, BIVAC, the ministries of Commerce and Finance and Development Planning, the Liberia Revenue Authority, the Liberia Land Authority as well as a consultant from the International Finance Corporation who made a presentation on ports systems and operations in Liberia. The Country Resident representative of the MRU, Christian Jallah was also in attendance.

The forum was held under the theme: “Resolving Constraint to Trading across Borders” one of the World Bank’s ten doing business indicators brought together a cross section of participants. According to the recent World Bank Doing Business Report, Liberia ranks 179 out of 190 economies in trading across borders. The report notes that on average, it takes 28 days to import or export goods into, or out of Liberia. Documentary and borders compliance as well as domestic transports were cited as some of the problems to trading across borders.