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Tough times for Malawi importers

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Steven Kapoloma

The kitchen is getting hotter for businesses who ply their trade in the import business following revelations of a sharp rise in international freight charges by international shipping companies, The Daily Times has established.

Dry bulk shipping rates have surged this year as the global economy bounces back from Covid pandemic-induced meltdown while the demand for commodities recovers.

The sharp rise in freight charges is exerting pressure on prices of consumer goods, a situation worsened by Malawi’s net-importer status.

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A Lilongwe-based business captain said yesterday that freight charges for a 40-foot container from China to Malawi via Dar es Salaam in Tanzania have rocketed by as high as 75 percent from around $8,000 to $14,200.

He said the sharp rise threatens prices of imports, including fertiliser under the Affordable Input Programme.

In a circular dated October 6 2021 to all Malawi Revenue Authority (MRA) stations, the organisation’s deputy commissioner for business support-customs and excise, Skiviner Mlowoka, advises station managers and staff on new guidelines for freight charges for goods from other countries to Malawi.

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Mlowoka says in the circular that all MRA station managers and staff should ensure that the revised rates are read, understood and complied with.

But in an interview Sunday, MRA spokesperson Steven Kapoloma said MRA had not changed international freight charges.

Kapoloma said the freight charges had gone up worldwide as a result of high demand for shipping and congestion at ports as some parts of the world economy were recovering from the negative effects of Covid.

“The authority is just informing its staff about the changes. It’s like a mother going to the market and finding that the prices of soap have gone up and reporting back to her family [about] the adjusted prices.

“In calculating duty, MRA will continue to use freight charges as declared by the importer. The importers are already paying these freight charges to the shipping companies as we are speaking,” Kapoloma said.

Freight forwarding expert Karl Chokhotho Sunday said Malawi, being a net importer, could not run away from rising freight charges.

Chokhotho, however, said the country could minimise the impact of the charges by, among other things, working on the right mix of transport modes for its goods.

He observed that combining cheaper modes of transport could help Malawi land its cargo cheaper, thereby reducing the price of consumer goods.

According to Chokhotho, water transport is the cheapest, followed by rail, road and then air transport.

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