To ease congestion at the marine terminals, both the TPA and KPA allow the transfer of domestic import boxes to bonded Inland Container Depots (ICDs) which, inappropriately, are referred to as Container Freight Stations (CFSs) in Mombasa. Normally, a CFS involves stuffing and stripping of containerized cargo. However, very little stuffing and stripping of imported containers occur at the facilities. Accordingly, only the term ICD will be used for these facilities henceforth. Most ICDs are located outside the ports and are operated by private enterprises. Nevertheless, since these ICDs perform activities previously performed at the marine terminals, the port authorities control the operations of these ICDs and impose ports’ tariffs onto them.
DAR ES SALAAM ICDS
Presently, Dar es Salaam has six licensed ICDs, with five additional ICDs under development. We visited two ICDs, TRH and Azam. TRH is the largest of Dar es Salaam’s ICDs and closest to the port, located about 2 km away. This ICD began operations in 2007 with 17 ha and has the potential to grow to 35 ha. In comparison, Dar es Salaam’s specialized container terminal only has about 13 ha. The main ICD’s facilities include a large container yard based on concrete pavers, modern reach stackers (RS), warehouses, Customs inspection shed and administration building, which also has offices for Customs and TPA. The complex is surrounded by security fence with steel gates and around-the-clock security. Azam is relatively small ICD, with a total area of about 4 ha, located about 7 km away from the port. Like TRH, the facilities, including container yard, sheds and offices are new and well maintained. Both ICDs have short access roads connecting them to the main highway leading to the port. Interestingly, both access roads are unpaved, with deep potholes, which turn muddy during rainy days. These roads also often get congested. Both ICDs declared their desire to finance the improvement of these roads but are not allowed by the City. Both ICDs are well kept.
The marine terminal/ICD transfer process is relatively simple and requires no involvement of consignees. The transfer could start immediately after boxes are discharged from ships and can be done within one day. In reality, it takes three days. We understood that part of this delay is due to cumbersome administrative
Processes (TICTS has to receive the boxes, TPA has to prepare invoices, collect fees, etc.), and part because TICTS can physically only load a limited number of boxes per day. Presumably, TICTS’ RTGs are busy serving ships. It should also be noted that although the ICDs are bonded, all import boxes are still scanned at the port and some of them are physically inspected. 9 Altogether, due to the combination of road conditions, road congestion and, especially, terminal congestion, the average roundtrip for TRH is four hours, most of it spent on waiting at the gate or in the yard. The distance to the port, as noted above, is only 2 km; at 30 km/hr, this distance requires less than five minutes. Azam reported a much longer roundtrip time of 8 – 10 hours.
According to TRH, the average dwell time of import boxes is about 15 days, of which seven days are free of storage charges. The long dwell time is attributed to Customs (see below for different dwell time in Mombasa’s ICD). Azam’s average dwell time is about 14 days, with about 30 percent of the boxes having dwell time of less than seven days. The importance of the latter is due to the fact that in the current tariff system, boxes released before seven days do not pay any fees to the ICDs.
The present tariff system originated at the pre-ICD era, when the marine container yards were congested.
In order to encourage fast release of boxes, a punitive tariff system was imposed by the TPA, based on a short
grace time followed by very high and quickly escalating fees for longer dwell times. This seems NOT to be the case anymore partially because the improvements in the releasing process (automation, etc.) have significantly reduced dwell times. Both ICDs reported a growing tendency to release boxes within the grace period of seven days. This trend is very desirable for the Tanzanian economy, except that it erodes the economic basis for the ICDs. The punitive storage fees are the main source of income for ICDs. Very few import boxes are actually stripped at the ICD and their content stored (hence the term CFS, used in Mombasa, is inappropriate). Likewise, the stuffing activity of export boxes is quite limited. Another result of the shorter dwell time is that the storage space in both ICDs is only partially utilized.
In both Burundi and Rwanda, customs clearance is not performed at the border but inland. In Rwanda, Co-State-owned company Magasins Generaux du Rwanda (Magerwa) runs four small ICDs in Kigali, but in 2008 a private company, SDV TRANSAMI Rwanda, was allowed to open one as well. In Burundi, customs clearance is performed at a small ICD in Bujumbura.