The words used to describe the scenes at the Ghana-Togo border would make any business person cringe: “chaotic”, “insane”, “a war.” These words lead quickly to business-unfriendly outcomes: delays and harassment.
Delays and costs at borders constitute significant barriers to trade.
“One trucking company I worked with abandoned the Nigeria-Ghana route, it was too much for them,” said Sola Ajayi, who manages a Nigerian trucking company moving goods daily on the route. “A truck was expected to arrive in three days and they were still waiting for it a month later.”
Ultimately it all adds up to an enormous loss in trade earnings. A new World Bank report
says Africa loses billions in lost trade every year due to barriers between countries. (A video
released with the report made in Democratic Republic of Congo includes scenes that anyone who has crossed a border in West Africa would find familiar.)
USAID West Africa Trade Hub studies point to a variety of issues. A comprehensive review
of transport costs on the Lome-Ouagadougou corridor indicates that traders could save US$80 million if the issues identified were resolved. Read the press release.
Two other studies looked specifically at the opportunity to expand business by improving implementation of regional trade policy.
Six months after its debut, the Border Information Center initiative, launched in collaboration with the Ghana Shippers’ Authority and the Abidjan-Lagos Corridor Organization, is calming the chaos, bringing sanity to the border and winning the war, stakeholders said.
“We’re perfectly placed to work directly with traders and we’ve had some definite success,” said Evans Klutse, director of the Border Information Center and a retired customs official who formerly oversaw the agency’s work at the Ghana-Togo border.
The stakes are very high. West African companies and governments could drive the boom in trade across the region – or fall by the wayside if the barriers are left unaddressed.
“There is a window of opportunity for West African businesses and governments that could close soon,” said Peter White, a consultant to the USAID Trade Hub who wrote the study. “They are perfectly positioned to serve the West African market – but they have to be able to do that efficiently. Otherwise, imports from other parts of the world will serve the market.”
Evans Klutse, director of the Border Information Center at Aflao, Ghana. presents on the center's work during a workshop in Accra.
What happens at the Ghana-Togo border is largely representative of the experiences traders have at every border in West Africa. Klutse’s weekly reports from the Border Information Center, which he has submitted since the center opened in August 2011 (see opening video below), show that information and assistance at the center effectively reduce delays and harassment. Traders have walked in to the office, strategically located at the intersection of the process, and called a free hotline to get assistance.
• A truck driver who had been arrested for “disrespect” was released after Klutse intervened. “These drivers are very vulnerable,” Klutse noted.
• Goods seized by customs from Beninese traders were released after the Border Information Center’s assistance. “The traders asked how they could get a similar center opened at the Benin-Nigeria border, where delays and harassment are severe they said,” Klutse wrote.
• Truck drivers at the border participated in a discussion led by the center to discuss concerns with police. “We communicated their concerns to the authorities,” Klutse noted.
The assistance is particularly effective, Klutse said.
“In virtually every instance where we are involved, we do obtain a generally satisfying outcome for the traders seeking help,” he said.
Resolving the problems at the border not only would lead to more business – companies would invest more and create more jobs – but increase revenues to the state. A 50% decrease in the time it takes to clear goods and move them across the border would increase trade by up to one quarter – and revenues similarly, one study showed.
A representative of BIVAC, the destination inspection company, makes a point at a workshop in Accra.
So, what are the solutions? It’s a trick question – many of the solutions are already codified in the protocols of the ECOWAS Trade Liberalization Scheme, which sleep on paper across the region. The real answer lies in the smooth implementation of those rules.
“There’s no one person to blame – everyone has a role to play,” said Fred Levitan, a consultant on regional trade who has studied the issues for the USAID Trade Hub. “A combination of factors results in the massive delays.”
At a forum at the USAID Trade Hub in February, stakeholders discussed the various actions each could take to reduce the clearance times of goods, but a fair amount of skepticism accompanied their words.
“We’ve been discussing these issues for years,” said one customs official in exasperation. “It really seems as though nothing changes.”
But it can be done, Levitan said.
“There are successes across Africa where innovations have led to significant improvements,” he said. “In Zambia, they reduced clearance times from seven days to six hours – and saw a 1,000 percent increase of revenues to the state.”
At the forum, about 15 representatives of customs, BIVAC (the destination inspection company that assesses the declared value of imports in order to apply customs duties), GCe-Trak, GCNet (the company that tracks the movement of goods in transit) and the Ghana Shippers’ Authority broke into groups and considered recommendations from a recent study.
“It can get better – and it will,” Levitan said.