GIFF welcomes new freight forwarding rates from GSA

The Ghana Institute of Freight Forwarders (GIFF) has welcomed the newly agreed rates for freight forwarding services as announced by the Ghana Shippers Authority (GSA) recently.

Mr Paul Kobina Mensah, GIFF Vice President responding to the announcement of the rates at a forum in Tema, said even though they got a 110 percent increment instead of the 250 percent they fought for, the freight forwarders appreciate it.

Mr Mensah explained that GIFF requested a 250 percent increment over the last negotiated rate, which was in 2016, due to the exchange rate volatility, inflation, and operational cost, among others.

He indicated that GIFF settled for the negotiated rates to promote trading activities for shippers who were their primary clients and expressed the hope that they will make up the deficit with the increased volumes of cargo cleared.

“In 2016, the dollar rate was GH¢3.9 and at the time of the negotiations it was around GH¢11.00; If you look at the margin it is over 300 percent. Inflation was 40.4 as against 17.5 in 2016. Putting these together, the best we could ask for was 250 percent,” he stressed.

According to him, the new rates would last for two more years, of which economic uncertainties were expected.

The GIFF Vice President revealed that the 2022 negotiation between GSA and the Committee of Freight Forwarder Associations (CoFFA) was the most hectic negotiation process they were subjected to as it took them six months to do so.

Mr Fred Asiedu-Dartey, the Head of Freight and Logistics at the Ghana Shippers Authority, said to arrive at satisfactory freight rates it was necessary for the Authority to undergo a rigorous and thorough process as it was important to tackle the various intricacies peculiar to the sea ports, airports, land borders, and transit as well as the various categories of cargo.

Mr Asiedu-Dartey said, “What happens at the airport is different from what happens at the seaports. When we talk about vehicle categories, alone for example, we are talking about motorcycles, saloon cars, SUVs, and earth-moving equipment.

“We needed to assess why the various increments for each category were necessary and fair. We needed to be meticulous, so we ensure that we get value for the Ghanaian shipper.”

He noted that a basket of variables including the exchange rate volatility and inflation were considered in setting the rate.

He said the GSA has finally dealt with miscellaneous charges that have been subject to debate over the years in the shipping industry, noting that everything has been consolidated in the charge expressing the hope that the freight forwarders would be able to operate within that scope.

Mr Asiedu-Dartey said its benefit for the shipper was that they could have a receipt that was a true reflection of how much they spent clearing the goods.

He stated however that GSA was yet to finalize the rates and modalities for the consolidators of cargo, noting that they have to hold a specific meeting with all the consolidators as some of them have their Container Freight Stations whereas others do not have to make their operations different, and therefore same rates could not be applied.

“We must consider which services and facilities at their disposal can affect the rates.

“However, the outstanding issue with the consolidators has to do with the shipping line charge which is a component of their charge to the shipper, and because a number of those charges are in dollars, and with the current fluctuations of the dollar rate, fixing a certain rate is difficult,” he explained.

Mr Asiedu-Dartey said the GSA has developed models that would be tested in live scenarios to arrive at the best outcomes when it comes to the services of consolidators, adding that the case of consolidated cargo to was expected to be finalized by end of January.

He entreated the various importers and exporters in Ghana to familiarize themselves with the new rates for clearing and freight forwarding services to factor it within their operations.

The rates to take effect this year would be used for freight services for two years to guide importers and exporters to plan their operations.

Some of the new rates are conventional general cargo such as steel products, plates, and drums, of up to 100 metric tons, which will cost a maximum charge of GH¢1,200.00 with every additional ton costing GH¢6.00.

A Saloon car will cost an importer GH¢1,300.00 for the services of a freight forwarder. For containerized cargo, a 40-footer container will cost a shipper GH¢2,800.00 whereas it costs GH¢2,000.00 for a 20-footer container.