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Al-Ahram Weekly 6 - 12 May 1999 Issue No. 428 
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Published in Cairo by AL-AHRAM established in 1875 |
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Al-Ahram Weekly 6 - 12 May 1999 Issue No. 428
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| Published in Cairo by AL-AHRAM established in 1875 |
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Egypt Region International Economy Opinion Culture Profile Features Special Focus Travel Living Sports People Time Out Chronicles Cartoons Letters A journey of troubles
by Sherine Nasr"To go to Kenya through Marseilles may seem, and in fact is, absurd. But this is exactly what it takes to export our products to African countries. We have no choice," said Abdel-Meguid Rostom, an exporter who has been in the business for the past 40 years.
Rostom was referring to the fact that there are no regular shipping lines connecting Egyptian ports with those of COMESA (Common Market for Eastern and Southern Africa) countries or Russia, or even nearby Morocco, Algeria and Tunisia.
"One of the sad facts about trade agreements is that they are always carried out on the level of governments, but when it comes to implementation, it is always ignored how lack of maritime transport can be a real obstacle," he said.
The latest agreement signed with the 15 COMESA countries opens the doors of Egyptian exporters to a market of at least 330 million people. The potential problem is that these agreements can end up being ineffective simply because there is not one single line connecting Egyptian ports with any ports in these countries.
"In this case, we have to ship our products to any European port such as Marseilles or Barcelona where regular liners find their way to these African ports," said Rostom. This procedure is not only a big waste of time, but it is also very inconvenient for all exporters. "The procedure involves extra costs that I have to put up with. The time factor is not on my side because other countries with a similar product can easily win the competition and, above all, the whole cargo, agricultural products in particular, can be ruined due to the long journey."
Rostom noted that five years ago there was a suggestion to establish a privately owned Egyptian maritime company to facilitate trade with the African countries. "So far, nothing serious has been done to make the suggestion a reality," he said.
The same scenario is virtually repeated with Egyptian companies exporting to Russia which encounter even more difficult problems. According to a number of exporters, their cargoes are shipped to the Ukraine and then transported by train to the former states of the Soviet Union. "Most often, the cargoes are looted on the way, and we find ourselves in big trouble with the importers in these countries," said Ahmed Nassar, an exporter.
It is worth noting that Egyptian exports to the former Soviet Union reached an estimated two billion pounds annually before the system there collapsed. "They dwindled to LE20 million in 1998," said Helal Shata, deputy chairman of the Egyptian exporters' division in the Union of the Egyptian Chambers of Commerce.
In fact, many international maritime companies have stopped running regular lines to Egyptian ports as they did in the 1980s when French, Italian, Turkish and Greek companies made the job easier for Egyptian exports. "The volume of Egyptian trade nowadays does not encourage these companies to resume their activities in Egypt," Rostom claims.
Yet it is ridiculous for a country such as Egypt with so many ports and such huge aspirations to maximise its export potential not to have a fleet of well-equipped ships to carry out the task.
"Unfortunately, this is the case," said Wa'el Lehita, a member of the Egyptian Businessmen's Association. "Most of Egypt's ships have become outdated and incapable of doing their job," he said.
The absence of the means to transport Egyptian exports to the outside world does not seem to be the only obstacle exporters are facing. A look at services in the Egyptian ports reveals that the journey of troubles begins at home.
"One of the major problems we have to face is the lack of uniformity of procedures among different Egyptian ports," said Maher Nofal, an exporter.
Nofal explained that each port has its own policy concerning procedures and cost of services. "For example, different services in Damietta port, including shipping and unloading, are done at double the price of any other Egyptian port for no clear reason," said Nofal, who added that procedures should be the same in every port inside the same country. "But when every senior official applies his own criteria, it becomes all the more difficult for the exporter to cope," he said.
The number of certificates issued and the different authorities whose approvals are required means the procedure is very exhausting. "At least five different governmental authorities have to be approached before approval is finally granted, and each requires its own certificates," he said. Still worse is the fact that no matter how long these procedures may take, it is of no concern to any of these authorities.
"This means that the cargo often has to be stored at the port and the exporter has to bear the costs," he said. Nofal wonders why each of these authorities has to work separately. "Representatives of these authorities can operate in the same building to save time and effort."
The daily time span during which different official authorities operate is hardly sufficient for a big volume of papers to be finished. A bureaucratic employee can simply leave before handing over the necessary certificate because it is already past his working hours. "This means that the cargo can miss a liner and wait for another which may not come before a week has passed," said Nofal. He added that officials should not ignore the fact that exporting is a 24-hour activity. "An exporter will naturally pay new storage fees and can be fined by the importing company because of the delay," he added.
Until 1997, government-owned companies entirely monopolised services concerned with shipping, unloading and storing in Egyptian ports including those in Alexandria, Damietta, Port Said and the Suez Canal. This monopoly did not allow exporters to choose the quality service or price they wanted to have. Although this monopoly has been broken by private sector companies that entered the field lately, the type of facilities rendered at the ports is still limited and not up-to-date. "We would like to see more advanced facilities similar to those provided in international ports," said Rostom.
Although many exporters agree that the government has shown goodwill towards expanding Egyptian exports through simplifying port procedures, they insist that follow-up is essential to make sure that the facilities are being extended effectively. "Exporters should have regular meetings with senior officials in these ports to study complaints and come up with practical solutions," suggested Nofal.
