COMESA urges States to join RCTG Carnet

Story by Tichaona Kurewa

THE Common Market for Eastern and Southern Africa (COMESA) and other stakeholders are urging regional countries to join the Regional Customs Transit Guarantee Scheme to reduce the cost of moving cargo.

The call was made on the sidelines of a regional stakeholder’s workshop in the resort town of Victoria Falls this Tuesday.

The COMESA Customs Transit Guarantee Scheme (RCTG CARNET) is an insurance bond or bank guarantee issued by sureties on behalf of the principals to customs administrations for any loss of revenue in case of damage or loss of goods in transit.

The RCTG CARNET is fully operational in Burundi, Kenya, Rwanda, Tanzania, and Uganda, and to fully expedite the movement of cargo on the North to South corridor countries like Zimbabwe, the Democratic Republic of Congo and Zambia have been urged to operationalise the scheme.

“In 2022 alone, over 1,282 RCTG (Regional) Customs Transit Bonds, amounting to US$ 1 billion were executed and over 330,618 Carnets were issued for goods in Transit in the Northern and Central Corridors.

“Today, landlocked or land-linked countries, such as Burundi, Rwanda, and Uganda are moving transit goods from the ports of Mombasa and Dar-Es-Salaam using only one regional bond and one declaration.

“This has not only reduced premium payments, collateral requirements, and documentation but also significantly contributed to the reduction of transit and transport costs and increased efficiency in the removal, movement, and clearance of transit goods in the Corridors. The reduction is estimated at $500 per container, $20 in the documentation, and a significant reduction in transit time,” said Mr Berhane Giday the chief programmes director of Yellow Card Scheme and RCTG Carnet, COMESA.

The Zimbabwe Revenue Authority outlined more incentives for the RCTG CARNET.

“The current practice in the North-South Corridor countries of raising the customs transit bond in each country of transit places an undue burden on business, is time-consuming and costly. Nationally, executed bonds have tied up significant finances belonging to importers, which, if released from the current system, may be used for other productive purposes. 

“The combined effect of road transit fees and other administrative and operating expenses that arise from the execution of nationally executed bonds tends to raise the cost of doing business.  These costs can be reduced or minimised by implementing the Regional Customs Bond Guarantee Scheme. Generally, it is believed that the RCTG CARNET has reduced the cost of transit and transport in the Northern and Central Corridors between 15 percent and 20 percent,” said Mr Alick Mutandiro, Head Transit Management, Customs and Excise, ZIMRA.

RCTG provides a uniform basis for the transit of cargo in the region, where only one guarantee is used to cover goods in transit.

It is a legal requirement that any person who wishes to import goods must deposit a security in the form of cash, insurance bond, or bank guarantee.

The security should be enough to cover the sum of duties and taxes in case of goods in transit are short-landed or diverted for consumption in the country of transit.

However, the issue of depositing cash or lodging an Insurance bond or Bank guarantee in every transiting country is a serious trade facilitation challenge considering the costs involved.

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