Towards a Central Africa Trade Facilitation Strategy: The intra-regional Logistic agenda

1. Towards a Central Africa Trade Facilitation Strategy: The intra-regional Logistic agenda BBL – September 29th 2011

2. Starting point: current portfolio of activities in Central Africa

3. The lenses to review the portfolio: the corridor analytical framework • From a shipper’s perspective, efficiency of supply chains is measured by three dimensions: • Prices • Time • Reliability • But all three are symptoms revealing dysfunctions in complex interactions between all the components of the chain • There is need to adopt an analytical framework which enables disentangling the causes of the inefficiencies so that the roots of the problems can be treated

4. The Corridor Analytical framework • Trade corridor components: • Maritime gateway • Land transport link • Inland terminals • At each stage, physical operations and documentation process are influencing each other’s efficiency • Overall coordination of the corridor components requires a monitoring framework, and dialogue between stakeholders

5. The main identified symptoms on Central Africa supply chains (1) • Gateway: • high delays at the gateway (up to 20 days in the port of Douala) • Inadequate facilities (access conditions for Douala and Matadi, both river ports) • Land-link: • Road transport industry organization not conducive to efficiency (alignment on worst performers, resulting in very high transport costs) • Superposition of layers of control by border agencies (GPS tracking, guarantees, bonds)

6. The main identified symptoms on Central Africa supply chains (2) • Inland terminal: • Inadequate facilities resulting in long immobilization delays for vehicles • Coordination of Customs processes over countries and transit regime • Coordination of the corridor: • Fragmented, no adequate forum to engage stakeholders, and not sufficient capacity among stakeholders to participate effectively • Lack of performance monitoring framework

7. Gateway: Physical operations • Port and terminal facilities • Capacity and efficiency deficit has been addressed through significant involvement of private sector in the development and / or management of port facilities • Interface with land transport • Terminal facilities under development, but need to address also the capability of transport operators (rail and road) • Physical interventions of border management agencies • Essentially a coordination issue to minimize unnecessary handling to access cargo due for inspection • Promoting non-intrusive inspection method (such as scanners) over physical inspection

8. Gateway: Documentation process • Two main issues for gateway operations: • Efficiency of the agencies and operators • Port authority and port operators • Border agencies (Customs, SPS, Ministry of Commerce, etc.) • Logistics operators • Coordination of the role of the various agencies and operators

9. Gateway: Documentation process challenges and status Efficiency of operators Coordination The trend has been to establish Single Windows for gateway processes: GUCE in Cameroon, starting in 1999 from a physical single window and evolving towards an IT platform, to manage ICT flows between operators Single window in DRC established in 2003, built on the Customs automated system ASYCUDA However, limited improvement, requiring revisiting the coordination • Border management agencies: • Customs modernization and reform programs yielded significant results • Other border agencies did not benefit from equivalent support • Freight forwarders and shippers: • Need to raise awareness on responsibilities of shippers and clearing agents in delays • Additional capacity building required

10. Land-link: Challenges • Challenges: • Improve the efficiency of the transport operators to reduce costs • Reform transport industry to ensure cost reductions translate into price reductions • Implement transit regime

11. Land-link: Efficiency of road transport • Intimately linked to the market structure of the road transport industry: • regulation of entry without minimal professional and technical requirements • freight allocation mechanisms which prevent competition • The program for reform is straightforward: • Regulate entry to road transport industry (vehicle, drivers and operators standards across the region) while managing transition • Open access to freight (liberalization, transport contractual arrangements) • However, conditions are not yet met for reform: • Need to analyze the political economy of the sector • Need to analyze impact of economy and operators • And more importantly, need to build consensus for reform

12. Land-link: Documentation process – Transit Regime • Current status (Pilot on Douala Corridors): • Multiple layers of control (bond, guarantees, GPS tracking) • Revised Transit Regime adopted but not implemented: • Addressing Regulatory issues (mutual acceptance of guarantees and interoperability of bonds, release conditions) • Supported by enabling ICT infrastructure (Connection of Customs) • Identified gap: • Actual implementation on the pilot corridor (Cameroon, Chad and CAR) • Integration of DR Congo in the CEMAC Transit Regime

13. Inland terminals: Challenges and status (1) • Inland terminals are the mirror of maritime gateways, at the other extremity of the corridor • Current challenges correspond to: • A lack of adequate facilities for physical operations • Combined with inefficiencies in the final clearing process • Situation differs between river inland terminals (Brazzaville, Kinshasa and Bangui) and land terminals (N’Djamena notably)

14. Inland terminals: Challenges and status (2) • Identified gaps: • Quick-fix solutions (facilities developed by private sector under BOT scheme) raise concerns about implication on impact on total logistics costs • Exploiting the large potential of mining resources requires specific attention to ensure accessibility at competitive conditions

15. Identified gaps versus ongoing programs

16. Proposed time frame to address the identified gaps