Agbiz highlights the contentious issue of the Merchant Shipping Bill (2023) in South Africa, specifically its cabotage restrictions. These proposed limitations could affect the logistical framework crucial for the export of perishables such as fruit. Annelize Crosby from the Agricultural Business Chamber (Agbiz) outlined potential disruptions to the cold chain during a meeting in Cape Town with Exporters Western Cape (EWC).
According to the Bill, foreign-owned ships might be constrained from executing short-sea shipping along the South African coastline, leading to possible increased costs and delays. Agbiz, representing over 100 stakeholders, warns of the "unintended consequences" that could emerge if the Bill is enacted in its current form. Crosby notes that the enforcement of cabotage could mean foreign vessels might be restricted to using a single port, likely Durban, affecting other national ports.
The Bill's provisions potentially make the operating environment restrictive, as shipping companies could face undefined permitting and licensing requirements. The resultant inefficiencies could increase shipping expenses and transit times, impacting the competitive edge of South Africa's fruit exports, especially in distant markets.
Logistical inefficiencies and increased transit days could compromise Sanitary and Phytosanitary (SPS) compliance, a cornerstone for accessing highly regulated markets like the EU. More complex procedures might undermine the vital cold chain, potentially leading to rejections of perishable goods from South Africa.
Competitive regional ports such as Walvis Bay and Maputo, offering less restrictive conditions, could become more attractive, threatening South Africa's export volumes. Additionally, Crosby indicated that foreign shipping lines do not intend to reduce rates to counterbalance the added charges if the Bill progresses.
The recommended course of action involves referring the Bill back to the National Economic Development and Labour Council (Nedlac) for thorough review. Crosby emphasized that socio-economic legislation with economic impact requires a comprehensive examination before passing. The apparent oversight by the Department of Transport in assessing the broader impacts of cabotage indicates that further consultation is necessary.
Upcoming actions include a decision by Parliament's Portfolio Committee on Transport. Crosby and Gale, among others, suggest engaging more stakeholders and government bodies to reassess the Bill's implications to ensure adherence to best practices before any legislative moves are finalized.
Source: Freight News
