Modjo Dry Port Boots Out Containers Overstaying Welcome

Over 390 containers confiscated this quarter by tax authorities

Over 390 containers have been confiscated at Modjo Dry Port during the first quarter of the fiscal year for being left in the dry port for over 180 days. Containers are allowed to be stored free of charge for a period of two weeks at Modjo, after which the importers are charged around two dollars a day for storage.

Although the time limits for port storage were set out in a 2014 regulation, it wasn’t enforced until 2016, giving an extended grace period to ensure that importers became familiar with the limits.

Now, even though the limits are enforced, ports and the customs authorities tend to give importers some leeway because of financial and clerical issues that they face.

“We are trying to support importers. However, some of them use the port as a warehouse,” said a manager at the port.

In June 2016, the Authority confiscated 223 containers under similar circumstances. The contents of the containers were then auctioned off by the Customs Authority.

As with those containers, the currently confiscated containers will be auctioned by the authority. The proceeds will then go to pay the containers shipping costs, any associated bank debts and the remainder goes to the importer, the port manager told Fortune.

The importers whose containers were overdue for removal were given warnings at the two month mark. Between the 60 day and 180 day mark, meetings and office visits were held and newspaper notices published to warn them to remove their imports, according to the port manager.

However, importers and forwarders say that the problem for delayed removal does not solely lie with them.

“There are issues with being informed that containers have reached the port in a timely manner. Sometimes banks don’t release the necessary documents in time, maybe because of foreign exchange problems,” says Saladin Kelifa, a freight forwarder.

Importers and transporters also face issues of conflict with customs authorities with regard to the taxes levied on their goods.

“The tax authorities don’t always tax imported goods at the prices that importers paid,” says Saladin. “Importers get into conflict and sometimes find it easier to just leave their containers where they are.”

The Modjo Dry Port, the first dry port in Ethiopia, was established seven years ago. It is currently being expanded at a cost of over one billion Br. The expansion has experienced delays due to the breakdown of machinery. However, because of the increasing demand for multi-modal transport services, the port is currently clearing 2,300 containers a day even before the construction is completed.

This is causing damage to the structure of the port, which will need to be separately assessed in the future. Once the expansion is complete, the port will have a holding capacity of over 15,000. It currently has a capacity of around 14,500.

Modjo Dry Port is located 73 km east of Addis Abeba and 553 km from Djibouti.


Published on Nov 29,2016 [ Vol 17 ,No 865]



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