In today’s shipping business, a shipping line or a ship owner cannot stand alone and dictate freight and other charges as well as the port operator cannot dictate the port charges. All players in shipping business depend on each other to survive and prosper in business. A shipper depends on a shipping company to carry goods to required destination and the shipping company depends on the shipper to get cargo for the vessel, likewise Shipping agents, Port and CFS operators, Clearing and Forwarding agents and Inland transport service providers cannot survive without cargo from shippers. A level playing ground and mutual understanding among players in the supply chain logistics is vital for economic growth in any Regional Economical Block.

In view of this, ISCOS advocates to amend the former ISCOS/East African Conference line VDS procedure and other surcharge procedures to the next level by developing a regional maritime operating manual. The said manual would include: procedures for introduction, increase and removal of surcharges, General Rate Increase (GRIs) and other relevant consultative issues well articulated for all players doing shipping business in the region to consider observing. Consideration of the manual would be beneficial to all stakeholders as it would give avenue for meaningful consultations and reduction of industrial acrimonies.

The cost of doing business in the East and Central African region is increasing day after day because of proliferation of charges in the supply logistics chain. The transport and logistics cost carry a big portion in the total cost of making cargo available to the final consumer. All stakeholders in the transport logistic chain contribute to varying degree to these costs. The transport logistic costs arise from all kinds of delays, inefficiencies, unnecessary procedures (bureaucracy), poor cargo off take, lack of efficient rail and road transport services and lack of trust between the revenue authorities and the shippers.

To do away with some, if not all of these costs, ISCOS is of the opinion that every player in the supply logistics chain should be held responsible and carry the cost caused by their inefficiencies instead of passing on all cost to the shipper (exporter/importer) alone who ultimately passes the cost to the final consumer. To make it practical, ISCOS advises and recommend stakeholders to develop and sign the Service Level Agreement which identifies who should do what and to what performance level so that whoever is responsible should pay for it. For example, there is no point at all for the Port/CFS to charge storage if the clearance for the cargo is delayed because of the Port/CFS inefficiency. On the other hand if an importer decides to turn the port into storage place by delaying clearing the cargo from the port, should be penalized for that. Delays resulting from poor declaration by Freight Clearing and Forwarding agents should be accounted to them and they be held responsible. If everyone in the supply logistics chain plays his/her part responsibly there will be remarkable cargo fluidity through our logistic chain.

Shippers Council is the cargo owners association established to join cargo owners together in order to protect their interest during cargo movement in the entire logistics chain. Exporters and Importers in the East and Central Africa region have the same cargo destinations and use the same means of transport. Shippers are hereby informed that other stakeholders in the supply chain logistics have their strong associations as their platform for protecting their individual and group interests. A Shipper being a major stakeholder in the supply chain must be able to negotiate the terms of moving the cargo to and from the market. Shipper should join hands and negotiate for favorable freight rates and conditions of services as one voice through their associations.

Shipper’ Councils role among others are:-

Due to the benefits to be driven by cargo owners and the trade as a whole through shippers’ councils, ISCOS is working hard to make sure that all shippers in the member states establish strong and vibrant councils to foster consultations between players in the supply chain logistics for the well being of the regional trade.

To date, through ISCOS and other stakeholder initiatives, Shippers Council exists in Kenya, Tanzania Mainland and Zanzibar and Uganda. In Zambia, establishment of the national shippers’ Council is at advanced stage hoping to be concluded by December, 2011.

Lack of enough land adjacent to Mombasa and Dar es Salaam ports in Kenya and Tanzania respectively and the increase of cargo originating and destined to these ports have made the establishment of CFSs/ICDs as port extension inevitable. Port extension aims at creating more space which allows optimum equipment maneuverability and hence decongesting the port. This was taken as a short time measure to decongest the ports when our ports were hit by the congestion crisis in 2007.

However, lack of space was and is not the only factor which causes port congestion. There are other factors such as poor cargo off takes, lack of cargo handling equipment, cargo clearance procedures, cargo free period policies, nature of ships calling at our ports, inefficiency in inland transport and limited use of technology.

We applaud our major ports for their effort to embark on port expansion projects (construction of berths 13 and 14 in Dar es Salaam port and berth 19 in Mombasa port). Indeed, these projects will bring about a remarkable improvement in our ports operations.

Once the construction projects of berth 19 at the port of Mombasa and berths 13 and 14 at the port of Dar es Salaam are completed, the problem of cargo fluidity in our ports will greatly be solved. Moreover, these projects should go hand in hand with the improvement of efficiency in port operations, inland transport especially the railway transport, port access roads, application of risk management system to enhance cargo direct deliveries, use of Electronic Data Interchange (EDI) to fast cargo clearance and increase cooperation among players in the port business.

Viewing our ports on the envisaged near future developments, there is a need for stakeholders in the port business to go back to the drawing board to review the role and future functioning of CFSs and ICDs. The review is much needed because the CFSs and ICDs have increased the cost of handling seaborne containers due to the element of double handling and transferring containers from the port to CFS/ICD.