Shipping agents suspend freight-collect transactions

Shipping agents have suspended freight-collect transactions, which allowed shippers to pay for freight upon the arrival of the vessel at the port, and are currently running a freight prepaid regime until further notice.

The decision has come about in the wake of the new directives from the Bank of Ghana on foreign exchange transactions in the country.

Mrs. Adobea Asiamah Aboagye, Chairperson, Greater Accra Regional Shippers Committee, who disclosed the problem to the B&FT in an interview, cited the need for a stakeholder interaction to solve the problem.

“Initially, we had doubts as to how the new directive was going to work; but upon insights from officials from the Bank of Ghana, we have come to understand the workings. However, an issue that needs to be tackled to ensure smooth transactions is where banks turn down freight payments in foreign currency.

“Shipping agents have suspended freight-collect until further notice because of this development. They are now running a freight-prepaid regime, which means shippers can no longer wait for the vessel to berth before they pay for consignments and related costs,” she said.

The reason for changing to the freight-prepaid regime is that in such situations the importer or consignee pays all the charges to the principal shipper in the country of origin even before the items are shipped, thereby enabling the local shipping agent to overcome the restriction of not billing the importer in foreign exchange.

Mrs. Aboagye said the shipping agents reached an agreement with the Bank of Ghana to allow them charge for freight in foreign currency, but foreign-currency cheques presented to banks are still being turned down.

“Despite earlier negotiations with the BoG, which the shipping agents notified shippers about, the problem still exists because banks still turn down payments in foreign currency.

“The problem can be related to a gap in communication between the central bank and the banks, and we are asking that they have a detailed interaction to arrive at a solution,” she said.

Meanwhile, the Bank of Ghana has come out clearly to say that shipping charges that will go back directly to the principal shipping firms can be quoted in foreign currency, but the rate should be in line with that of the central bank.
Aside from that, all other charges that are rendered locally to local-based companies must be quoted and paid in cedis, in line with a new directive on forex transactions.

“Payments for goods and services delivered in the country must be cedi-denominated. You need dollars when dealing with clients outside the country. All services rendered to locals once the vessel has berthed should be quoted in cedis,” Dr. Benjamin Amoah, Head of Financial Stability at the Bank of Ghana, said last week.