There is a growing realisation within South Africa and within the broader region that trade liberalisation alone will be insufficient to ensuring that a solid platform is created for far higher levels of intraregional trade.

Therefore, attention is beginning to shift to the many nontariff barriers currently constraining trade within Southern Africa, including making material improvements at various key border posts. The idea is to improve cooperation between countries, while implementing systems that can help lift operational capacity and improve the customs experience for travellers and traders alike.

UK-funded regional trade development organisation Trademark Southern Africa (TMSA) argues that such improvements require strong political drivers at the highest level, as such priority attention helps to facilitate cooperation between governments, as well as between private and public organisations.

But it is a complex process, as the interests of a government at a border post are diverse and include security, enforcement of immi- gration requirements, health regulations and import and export controls, as well as revenue collection. These interests are protected by several State agencies, such as the police and security, customs, immigration, sanitary and phytosanitary agencies, as well as standards bureaus, TMSA says.

“Generally, and traditionally, each border management agency works by itself. Integrated border management, however, focuses on coordination and cooperation between these players in an effort to streamline border procedures, avoid duplication of control measures and improve communication, information exchange and mutual assistance. This means a border can be managed more efficiently to speed up the movement of goods and persons across borders,” says TMSA.

But to reach such a point, consultative meetings at national level are required. Such processes could be followed up by the con- vening of stakeholder meetings involving the public and private sectors within a country to deal with their internal issues and correct any shortfalls before engaging on a bilateral level.

Successful processes, TMSA argues, require countries through which a corridor traverses to take collective responsibility for addressing problems. Such a corridor approach has already been tested along the North–South Corridor project, which traverses eight countries in Eastern and Southern Africa, and has proved effective, it adds.

Cooperation Essential
Maputo Corridor Logistics Initiative (MCLI) CEO Barbara Mommen agrees that cooperation and consultation are critcal. The organisation spearheads the trade corridor from South Africa’s economic hub in Johannesburg down to the Indian Ocean port of Maputo and was established in 2003 to address freight and logistics constraints on the route.

“Cooperation is significant in the MCLI’s operation. Our role is to resolve the constraints on the corridor. Cooperation and relationships are crucial because the relationships that we have developed have ensured that we are able to access government and private sector leaders at the highest level. This is important for new corridors trying to operate efficiently,” she says.

Further, TMSA notes that it is important to remember that border posts do not stand alone – they form part of multimodal transport corridors that can span many countries and a number of different elements – road, rail, ports and border posts, as well as trade and transport facilitation issues.

“It is important to view any border post initiatives [as being] aimed at reducing the cost and time taken to trade across borders, within this bigger framework. It is also important to understand that gains at one or two border posts might be negated if challenges further down a corridor are not resolved. This holistic approach means that, practically, African countries, and the different regional economic communities they belong to, have to work together when it comes to facilitating trade in the region.”

The South African Revenue Service (Sars) is alive to the importance of border-post efficiency. It says it has also begun to respond to the issues highlighted by TMSA in its study on the Chirundu border post, between Zimbabwe and Zambia. In that instance, it was found that journey times typically comprised “one-third driving and two-thirds waiting” and that the most effective way to reduce costs was to reduce waiting times at borders. Efforts have subsequently been made to materially reduce waiting times, with some success.

“For those who operate in Africa, delays at border posts contribute the largest cost of logistics. It is, in fact, what makes our transport and logistics costs much higher than the rest of the world’s,” notes Mommen.

Trade and transport facilitation efforts, including improvements at border posts, will have a positive impact on intraregional trade, as well as the competitiveness of the region to trade internationally, by reducing the time and cost of cross-border trade, adds TMSA.

Sars, since June, has rolled out the second phase of its Customs Modernisation Programme to all its inland customs offices, as well as the Lebombo border post with Mozambique. In October, it also announced that it had rolled out this programme to the troublesome border post with Zimbabwe –Beitbridge.

Changes at Beitbridge?
“Key changes have been implemented at the Beitbridge border post, including the introduction of an electronic case management system, called Service Manager, a new inspection process, electronic submission of supporting documents, new Customs Status Codes, an electronic release system, reducing the need for paper and authorising stamps at branches, which should result in reduced turnaround times, and measures to enhance the through flow of the control area, including people and vehicle movement control.”

The aim is to eliminate all manual processes at customs offices as far as possible through greater automation and to speed up the inspection process. Paper supporting documents will no longer be accepted at Beitbridge and it will soon become compulsory for traders to submit all documents electronically, Sars says.

“The far-reaching Customs Modernisation Programme, launched in 2009, will make it easier and more convenient for traders to comply with their obligations and involves the use of a modern, electronic and integrated technology platform together with the redesign of basic processes to bring about several benefits for traders and for Sars. These benefits include greater ease of movement of goods and cost savings for traders, as well as increased efficiency for Sars,” it explains.

The first change was the introduction of the electronic data interchange (EDI). The uptake of EDI by trade has grown significantly and Sars Customs now receives more than 95% of international clearance declarations electronically, it says.

The entire declaration process was redesigned in line with international instruments like the Kyoto Convention and the World Customs Organisation Customs Data Model, continues Sars.

“The first phase of the Customs Modern-isation Programme enabled a step change in customs clearance processing, bringing internal staff, external traders and trade practitioners in line with the ‘new’ way of presenting goods for clearance under Home Use or a Customs Procedure.

“Although this phase does not align customs clearance fully with the expectations and intent contemplated in the draft Customs Control Bill, an interim framework has been developed that will take account of current clearance requirements, while simultaneously preparing traders for a new mindset before the introduction of the new Customs Act,” says Sars.

Further, Phase 2 follows a similar path to Phase 1, where current customs legacy systems serve as back-end processing engines for clearance and release purposes.

“It is extremely important that every enforcement agency, service-providing agency and relevant private stakeholder groupings from both sides of the border is represented at steering committee level.”

The approach that Sars has successfully employed to date is to include representative bodies of external stakeholders, as opposed to individual bodies, as part of a steering committee.

Data standardisation and integration, both customs to customs and with all other agencies or supply chain entities along a transport corridor, are needed to facilitate one-stop border posts (OSBPs).

“Effective OSBPs integrate the data, processes and workflow of all the relevant border agencies of a country with that of the other, which then culminates in a standardised operating model that is predictable, trans-parent and a comfortable experience for the legitimate traveller and trader.

“To achieve this requires an extensive legislative framework and the cooperation of multi-agencies. However, prior to integrating cross-border, it is a key requirement that an administration first internally seeks efficiency in border processes, policies and services, and that a local integrated approach is first realised,” explains Sars.

Other Progress
Mommen says MCLI has also moved to reduce constraints on the Maputo Corridor by ringfencing specific issues and then creating dialogue amongst all the members of its working group to implement solutions to these problems.

“It is not often that one gets government and the private sector to focus around one particular issue on a corridor or around logistics inefficiencies. This is why our working group mechanism is important; it creates trust between the parties, which, in turn, creates an environment in which effective solutions can be implemented to address logistical constraints,” she explains.

The success of the Chirundu OSBP initia-tive has largely been due to close partnership between the public and private sectors, with technical support from TMSA and regional trade body the Common Market for Eastern and Southern Africa, notes TMSA.

Further, a critical element of the Maputo transport corridor’s success is that trade facilitation and regional integration can only occur if there is confidence in the region, which leads to economic growth in the region, avers Mommen.

In the future, customs and other regulatory authorities will see the border post as a control point to enforce measures related to security, immigration control, safety of imports and other such standard border controls, says TMSA.

Commercial imports and exports will be recorded at the border posts using summary declarations and detailed clearance pro- cedures will be undertaken at inland stations where fiscal control measures can be more effective. This will be complemented by better use of risk management and application of postclearance auditing, it says.

So far, tangible positive results have been recorded for both passenger and commercial clearance at the Chirundu border post. It is for this reason that the concept could be replicated throughout the region to facilitate trade and reduce costs associated with waiting times, TMSA emphasises.

TMSA reports that the opening of Chirundu as an OSBP has led to significant savings in the time taken to cross the border, which has translated into cost savings.

“To implement an OSBP, there is need to address physical facilities, operations and training and the legal framework (extra- territorial jurisdiction). There will be challenges but procedures should be signed off so that outstanding issues, such as signage, training programmes, communications infrastructure, preparation of a performance charter and final modifications to buildings, can be completed,” explains TMSA.

“It would be a much simpler exercise to operate an OSBP if it was designed as such from the onset, instead of having to modify physical infrastructure after it has been built and to adjust procedures to take account of the limitations of the physical infrastructure,” the organisation says.

This has implications for the coordination of the process of designing an OSBP. In Chirundu, subcommittees dealing with information and communication technology, facilities, procedures and legal concerns were established; however, these should be established before the design work starts, it emphasises.

“The process of introducing an OSBP should also be accompanied by a change in the management process and failure to adequately address this issue could lead to poor or nonimplementation.”

There is a need for the steering committee responsible for the implementation of the OSBP to sign off on the procedures, preferably by putting these in the memorandum of understanding that has allowed the establishment of the OSBP, and to maintain these procedures. Failure to maintain the agreed procedures will delay implementation and necessitate multiple design and works contracts having to be awarded, which increases costs.

Mommen notes that Sars’ Customs Modernisation Programme at Lebombo, between South Africa and Mozambique, which was its first landside border implementation of the programme, has significantly reduced the interface between people and documents. Submissions are now mostly done electronic- ally and she believes that Sars is moving towards 100% electronic preclearance for cargo.

“Also, in Mozambique, the single-window system pilot is going to be implemented soon at the Port of Maputo. We are told that these two systems are compatible and talk to each other. This, again, will increase efficiencies.”

What the MCLI has done along with its partners – Sars is one of them and the customs authority, Alfandegas, in Mozambique, another – is to work closely to ensure that it can provide a competitive logistics supply chain, she adds.

Maputo port ferro pad manager and executive committee member Rui Santana Afonso notes that the port and its partners are investing heavily in the Port of Maputo to ensure that the entire logistics chain works and it is working closely with government, partners and stakeholders.

“We have spent over $220-million in port operations and plan to invest much more over the next five to ten years.”

Significantly, he notes that relationships are important because these focus on under-standing the job at hand and solving a user’s problems, which boosts trust and, thus, the use of a logistics corridor.

Further future strategic development of the Maputo Corridor will centre on promoting transit cargo, which means that trucks will carry loads both to and from the port, says Mommen.

“This is not something done at Maputo port since the late 1990s and we are working on this aspect of the logistics chain to significantly reduce costs by increasing such efficiency measures. However, this is a long-term strategic view to developing the corridor as a regional integration and economic development tool.”

Further, Mommen argues that logistics can provide the mining and minerals industry with a competitive edge as far as commodities are concerned because the global supply chains that the country operates have changed, with longer distances and shorter lead times.

Costs Still High
But Imperial Logistics marketing manager Abrie de Swardt says that logistics costs in South Africa are too high for the size of the economy and, further, there are bottlenecks and a shortage of capacity.

“However, this represents an opportunity to increase our output, because, as a country, brand South Africa competes against other countries.

“We have great opportunities to change the status quo and to improve the scenario today.”

The first part of the solution is the use of intermodality, also called comodality.

“We need to have a common objective, which is to move railcentric products off the roads and onto rail.

“It is not a case of either road or rail but that road needs to complement rail, and vice versa. We need to consider the total logistics chain in South Africa,” he emphasises.

South Africa has an average of 1 000 manganese trucks on its roads each day, which is a disgrace, he says, but notes that this presents a significant opportunity to move this cargo onto rail.

“We need to bear in mind that transportation and using the wrong mode of transport, for example moving a railcentric product by road, are simply not clever, because they consume fossil fuels, increase emissions and increase costs. Therefore, we need to relook at the entire supply chain network.”