The curious change of international trading processes

At the beginning of this week, shippers and other stakeholders in Ghana’s international merchandise trade sector were surprised to learn that the single window system of processing international trade transactions between Ghana and the rest of the world is being dismantled, to be replaced by what has been dubbed UNIPASS.

Unsurprisingly though, this has been met with overwhelmingly uncomplimentary comments by all sorts of industry stakeholders who are questioning the rationale for the switch and are making dark speculations as to the motive behind government’s decision.

This newspaper is taking a more charitable stance, if only because of the dearth of information available to us with regards to the reason for the change in procedural framework.

Nonetheless we agree that it is imperative government gives a thorough explanation as to why it decided to replace the single window system with the new UNIPASS procedure.

To be sure we are not fully on the same page with those who argue that the switch is wrong because the new company taking over the facilitation and supervision of the process is charging more than GC Net and West Blue who were in charge of implementing the single window system.

This is because we acknowledge the possibility that the new system could be significantly more efficient and effective than the one it is replacing, and indeed could have the potential to generate substantially more international trade tax revenue for the state.

But the problem is that government has not told us whether this is actually the case. Indeed, government has not explained why the system is being changed in the first place, a situation made all the more curious by the fact that prior to the announcement of the change, a couple of days ago, government had not even publicly found any major fault with the single window system and its implementation.

We suggest that it does so now.

We also suggest that it commences training of clearing agents state revenue officials and all the other stakeholders in how the new system will work. In view of the lack of public education so far, its doers not seem likely that the new system can start smoothly at the very start of the new year, unless training has been going on in secret with a view to presenting the public with a fait accompli. Instructively, even this is uncertain.

What is though is that Ghana needs to tread carefully with regards to its international trade architecture. This is a country just coming out of an International Monetary Fund medium term programme brought about by macroeconomic instability which was threatening the size of its gross international reserves.

Also, our banking sector is only now emerging from severs and widely publicized insolvency problems.

These have been enough to make Ghana’s international trade counterparties somewhat jittery. Adding on sudden and unexplained fundamental changes in the processes and procedures for international trade transactions could make an already unsavoury situation even worse.