A JoyNews investigation has revealed how cement manufacturing companies shortchanged the country with over $100million lost at the ports.
Leaked confidential documents from national security reveal that the Tema and Takoradi ports lost millions of dollars in import duties and taxes on tonnes of clinker imported by cement manufacturing companies over the last five years.
In a three-part series titled ‘Leaking Ports’ Joy News’ Kwetey Nartey takes a look at how the absence of weighbridges at the ports contributed to this massive revenue losses.
The annual consumption of cement in Ghana is estimated to be 5 million tonnes per year, 2018 statistics from Trade Information website – Ghana trade.
Leaked files from the national security reveal that in the last five years, there has been a significant and steady increase in the quantities of clinker imported by cement manufacturing companies in the country.
Data from the Ghana Shippers Authority reveal 1.8 million tonnes of clinker was imported in 2014, 1.2 million in 2015, 1.4 million in 2016, 1.9 million in 2017 but 895, 519 in 2018.
In 2017, two more cement factories went into production, increasing the country’s capacity. This should normally have resulted in an increase in the importation of clinker in 2018.
Out of the estimated 5 million tonnes of cement consumed in 2018, 4.5 million tonnes was produced locally.
Given that clinker constitutes seventy per cent of the composition of cement, the National Security documents show that the amount of clinker needed for the 4.5 million of cement produced locally in 2018 ought to have been 3,150,000 tonnes.
However, only 895, 519 tonnes of clinker was declared by the cement manufacturing companies. This represented 2.2 million tonnes of the shortfall from the estimated figure.
The ports have no weighbridges for weighing liquid and bulk imports for purposes of assessing duties and taxes.
The leaked documents reveal that they rely on data from vessels and cement manufacturing companies for tax and duty calculations.
Tema Customs Sector Commander, Joseph Adu-Kyei confirmed the absence of weighbridges at the ports to Joy News.
Like the port authorities, the Customs Division of the Ghana Revenue Authority (GRA) also relies on multiple data sources to charge duties on imports by the cement companies.
In 2018, for instance, the revenue loss, according to the national security files, was over $62 million in import and port duties. The estimated duty on a ton of clinker is $26 while port dues are $2 per ton.
Government, therefore, lost about 58 million dollars in duties and taxes while Ghana Ports and Harbours Authority (GPHA) lost $4 million as a result of the more than 2 million tonnes of clinker that were undeclared.
The national security files attribute the leakages to poorly calibrated weighbridges. The Ghana Standards Authority (GSA), however, says it tests the weighbridges of the cement companies twice a year.
George Omane Twumasi is the Director of Metrology at the Authority claim the margin of error was significant.
From the national security files, it seems a win for the cement manufacturing companies, while the state coffers bleed.
General Manager, Marketing and Corporate Affairs of GPHA, Esther Gyebi-Donkor holds a contrary view.
She says the ports’ measures make it difficult for the cement companies to exploit the system.