FTZMA expresses BOI enterprises concern over undue delays, inadequacies in shipping and customs

The Free Trade Zone Manufacturers Association (FTZMA), yesterday expressed concerns of BOI enterprises over the undue delays and inadequacies in shipping and customers operations. 

The fresh concern is despite the FTMZA having had discussions on the same issue with Customs Additional Director General – Revenue and Services Seevali Arukgoda.

“We are yet to observe customs-related delays on top of the challenges currently being faced by our enterprises due to operational difficulties caused by the maritime industry owing to lack of space and containers,” FTZMA Chairman Dhammika Fernando and Secretary Tyronne Weckasinghe wrote to Arukgoda yesterday, with copies to BOI Chairman Dinesh Weerakkody and Ceylon Chamber of Commerce Chairman Duminda Hulangamuwa.

FTZMA listed the following issues/concerns.

Delays in LCL cargo clearance from the port

We observe constant delays when clearing LCL cargo from LCL cargo warehouses inside the port due to their inefficiencies. This is stretching for at least two weeks’ time from the day of de-stuffing. Moreover there is a significant delay in de-stuffing of LCL cargo after the arrival of import containers.

Customs delays

Though the trade union action of Sri Lanka Customs is over, our importers are yet experiencing undue  delays (10 to 14 days) in clearing goods due to customs backlogs following capacity constraints and lack  of workforce of Customs to clear the back-log.

Customs inspections

Customs are now conducting 100% physical inspections on imported cargo without identifying the legitimacy of the importer through the authorised economic Operator (AEO) system which was introduced some years ago. They disregard whether imports are raw materials consigned to BOI enterprises or other merchandise for domestic consumption.

Sudden Increase in haulage cost

Regardless of the rates being applied in accordance with the ACTDO tariff, truckers/trucking companies are increasing transport rates haphazardly due to on-going delays in the ports.

Delays in making Exports

Exporters are finding difficulty in getting containers for exports due to prolonged delays in clearing import cargo clearance thus leading to a scarcity of containers needed for exports. Given the congestion in ports, shipping lines are rolling over or not accepting export cargo bookings. Disrupted Flow of Goods out of the country is causing bottlenecks and hindering the movement of products from suppliers to end customers thus eroding the customers/buyer trust and damaging brand reputation thereby losing business to our competitor countries. We also observed that ocean freight rates too have drastically increased, adding up to an additional $ 4,000 to 5,000 per TEU.

Lack of “can-do attitude” of Customs and Port officials

Except for a few, the majority of officers both at Customs and SLPA are very lethargic and have a “not to make things happen” attitude as they are highly resistant to persuasion. They are often becoming utterly rude and an absolute disgrace to their homeland. We know that attitude change is a difficult thing but it can be done and takes time.

The issues highlighted above are disrupting the flow of goods in and out through the supply chain, causing bottlenecks and hindering the movement of products from suppliers to customers. We therefore would earnestly request you to address these concerns promptly to mitigate further disruptions and the financial burden faced by all stakeholders as a result of increased storage costs and tying up working capital.