Why Does Cargo Spend Weeks in Sub-Saharan African Ports?

Gael Raballand, Salim Refas, Monica Beuran, Gozde Isik

ISBN 10: 0821394991 / ISBN 13: 9780821394991

Published by World Bank Publications, US, 2012

About this Item

This book argues that long dwell time in Sub-Saharan African (SSA) ports is not exclusively the responsibility of customs as usually believed. The private sector (terminal operator, customs broker, owner of container depots, and even importers) has not necessarily an interest in reducing time spent in ports. The solution to decrease dwell time in these ports relies mainly on the challenging task of breaking the private sector's collusion and equilibrium between public authorities, logistics operators, and some importers. This book was written in the context of increasing investment by the international community in projects that promote trade facilitation and improvement in logistics in the developing world, including in ports, mainly based on the assumption that in ports, customs (and other controlling agencies) have to be mainly blamed for abnormal delays. However, customs responsibility (especially for months-long delays) may not be as important as usually believed and therefore requires in-depth data collection and analysis which has been lacking so far. The authors disentangle cargo delays in ports with comprehensive data collection in six ports in SSA and firms' surveys in five countries. Based on this data collection, they find that cargo dwell time in ports in SSA (except Durban) are very long compared to large ports in Asia, Europe, and Latin America. In these ports, there is collusion between controlling agencies, port authorities, private terminal operators, logistics operators (freight forwarders) and large shippers at the expense of consumers. The market structure of the private sector explains the hysteresis of cargo dwell time. Finally, the structure of the SSA economies with few export-oriented producers (and the dominance of traditional import/export traders) reinforces the status quo since they are usually not organized to be competitive worldwide.

Seller Inventory # LU-9780821394991

Bibliographic Details

• Title: Why Does Cargo Spend Weeks in Sub-Saharan African Ports?
• Publisher: World Bank Publications, US
• Publication Date: 2012
• Language: English
• ISBN 10: 0821394991
• ISBN 13: 9780821394991
• Binding: Paperback
• Condition: New
• Weight: 333 grams

About this title

Synopsis

Sub-Saharan Africa has a serious infrastructure deficit―estimated at about $48 billion a year―which is impeding the continent’s competitiveness and hence its economic growth. How to solve this problem? Some advocate building more infrastructure while others suggest privatizing, or contracting out to the private sector, the management of infrastructure so that the discipline of the market will lead to more and better quality services. This book graphically illustrates the problem in the case of Africa’s ports. With the exception of Durban, cargo dwell times―the amount of time cargo spends in the port―average about 20 days in African ports, compared with 3–4 days in most other international ports. None of the past attempts to solve this problem have worked. The reason―and this is the major contribution of this volume―is that long dwell times are in the interest of certain public and private actors in the system. Importers use the ports to store their goods. Customs brokers have little incentive to move the goods because they can pass on the costs of delay to the importers. And when the domestic market is a monopoly, the downstream producer has an incentive to keep the cargo dwell times long as a way of deterring entry of other producers. The net result is inordinately long dwell times, ineffective interventions, and globally uncompetitive industries in African countries. The solution to decrease dwell time in these ports relies mainly on the challenging task of breaking the private sector’s collusion and equilibrium between public authorities, logistics operators, and some shippers and not on investing massively in infrastructure. Addressing the challenge will also require that there be political support from the general public for reforms that will promote their interests. And before they offer their political support, the public needs to be informed. This book is a step in that direction.