CHALLENGES ON USED CARS IMPORTATION AT THE PORT OF DOUALA AND ITS IMPACT ON THE IMPORTERS
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The study was about the challenges on used cars importation at the port of Douala and its impact on the importers. All imported goods are subject to customs clearance at the port of entry in every destination country. Delay in customs clearing of goods causes to emerge and increase demurrage costs and abandonment of cars at the port. The study has determined and evaluated the import challenges faced by countries in the CEMAC zone as some of these countries imports’ through the Douala sea port, Cameroon. Factors were combined to yield different sets of challenges in these countries. The research methodology concerned about data collection where the researcher was applying systematic approaches in data collection so as to come up with specific findings. The researchers used a survey research design to find the challenges on used cars importation at the port of Douala and its impact on the importers. Interview was the main instrument for data collection. The Data Extraction table was used to analyse the data gathered in the field. The straight line equation was used to determine the study population, the study used a census of 37 respondents using systematic random sampling technique, and method of data collection (primary and secondary data). These respondents consisted of the Douala Port Authority Managers, the Cameroon Custom Authorities, clearing agents, import clients . The finding revealed that among major challenges come as the results of clearance procedures in Cameroon being too long, surrounded with corruption environment due to multiple documentation requirements and the procedures are neither transparent enough nor documented. The study concludes with a brief set of policy recommendations.
According to a report published by the United Nations Environmental Programme (UNEP) revealed that an estimated 14 million old, pollution-emitting cars have been exported from rich countries and “dumped” on developing nations between 2014 and 2018. More than half of these vehicles have been sent to Africa.
Experts have found that 80% of these cars have failed to meet the safety and environment standards in the country they were exported from. The vehicles are not only prone to causing accidents, but the air pollution that they create contributes heavily to climate change, as well as having health impacts.
most of the vehicles caused a lot more air pollution than cars that are approved according to the Euro 4 emission standard, which is the acceptable limit for exhaust emissions caused by a vehicle being sold in Europe.
“Those vehicles emit 90% more emissions because they are not meeting this minimal standard,”
The UNEP report found that regulations on car imports in most of the 146 developing countries were “weak” or “very weak”.
some African countries do not have a solid grading standard when it comes to accepting imported cars. “Around 30 countries [in] Africa do not have any age limit on cars. So, any kind of car of any kind of age, can come in.
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They call the cars both “dangerous and dirty.”
They believe that most of these vehicles are responsible for increased levels of road accidents in many poorer African and Asian countries. The cars also emit fine particulate matter and nitrogen oxides, which are major sources of air pollution in many cities.
Along with being unroadworthy and environmentally harmful, most of the cars were tampered with before being imported in order to remove valuable parts. The replacement of these parts with cheap alternatives makes them more dangerous to operate.
“They have illegally removed the airbags, because they have a value in Europe; they have illegally removed the anti-lock brake system because it has a value and is being sold on the black market.
The cars in question were mostly exported from Europe, Japan, and the United States, with the majority of them coming from the Netherlands.
The Dutch authorities are aware and concerned about the trade of these cars, and are hoping to take immediate action, according to the BBC.
“The Netherlands cannot address this issue alone,””Therefore, I will call for a coordinated European approach, and a close cooperation between European and African governments, to ensure that the EU only exports vehicles that are fit for purpose, and compliant with standards set by importing countries.”
There is now a growing awareness in some African countries of the dangers that the cars being imported have, and some countries have begun to tighten their regulations before taking in these vehicles.
Morocco and Kenya have applied age limits to the cars that they will import, with the former only permitting cars less than five years old, and the latter accepting vehicles that are less than eight years old.
The Economic Community of West African States (ECOWAS), which represents 15 countries, has set cleaner fuel and vehicle standards from January 2021.
Car ownership around the world currently sits at 1.4 billion vehicles, and the number is expected to reach 2 billion in the next 20 years. The majority of this growth will come from developing nations in Africa, Asia, and Latin America.
With this in mind, the authors of the UNEP report are calling on the leaders of both the exporting and importing countries to take actions on this matter.
“On one hand, I think it’s unethical that these developed countries export vehicles that are not roadworthy on their own roads,””On the other hand, why have the importing countries been waiting so long to put in place some minimum standards? So I think the onus is not only on the exporting country, it’s really a joint responsibility.
Importation and Exportation are the elements which define a 21st century economy .Whether a country imports more and exports less,it’s what strengthens its economy as well as its relationship with other countries .Importation has almost become a way of life not only to Cameroonians but to Africans as a whole .Before the colonisation of Cameroon which lead to the modification of the way of life of the inhabitants of the territory by its colonial master ,Cameroonians were used to the local methods of transportation which was on foot and animals back .It was a thing of honour and prestige for one to own a car but these days it has become a necessity to Cameroonians .The Europeans introduced the use of vehicles to facilitate their movement within the territory. Since Cameroon at the moment has not got what it takes to manufacture its own vehicles used in the country are assembled from imported vehicle parts from European countries .To get this vehicle parts as well as other whole vehicles, Cameroonians are forced to import them .The Cameroon economy is suffering from the importation of used vehicles because it appears to be a dumping ground for European scrapes. In the second Hand market, the volume of trade increases due to specialisation.
International trade is the exchange of capital goods and services across international territories because there is a need or want of goods. This kind of trade contributes and increases the world’s economy. IN most countries such trade represents a significant share of Gross domestic product (GDP). According to Wasserman and Hartman: International trade consist of transaction between residents of different countries.
Anatol Marad(2012): defines international trade as international means to trade between nations. International trade is classified into import trade, Export trade and Entrepôt trade. While it has been present throughout much of history. Its economic social and political importance has been on the rise in recent countries. Importation is one of the critical forces that encompass international trade. Many countries rely on import to benefit or consume goods which they cannot produce. According to Dr Jean Paul Rodriguez (2017) companies performed various activities in more than one country such as manufacturing, selling or even sourcing. Technology has made it possible to access multiple markets around the globe within a short time.
International trade has increased exceptionally that includes services such as foreign transportation, travel and tourism, banking, warehousing, communication, advertising and distribution. Other equally important developments are the increase in foreign investment and production will help companies to come closer to their international customers and therefore serve them with goods and services at a low rate. Countries differ in how they take part in international trade.
The classical theory of international trade is popularly known as the theory of comparative cost by David Ricardo. It was formulated in 1815. The classical approach in terms of comparative cost advantage as presented by Ricardo, basically seeks to explain how and why countries gain by trading. The classical law indicates that each country will specialize in the production of those commodities in which it has the greatest comparative advantage or the least comparative disadvantage thus a country will export those commodities in which its comparative advantage is the greatest and import those commodities in which it’s Comparative disadvantage is the least.
Kravis’ theory of Availability In the Kravis (1956) model technological innovation as a basis of trade Operates through his product Availability hypothesis. The availability approach seeks to explain the pattern of trade in terms of domestic availability and non-availability of goods availability enhances trade through demand and supply forces. According to kravis, a country produces and exports those goods which are available that is Goods developed by his entrepreneurs and innovators.
Trade as an engine of economic Growth. As P. A Samuelson and W. D Nordhaus convincingly argue. Free trade promotes a mutually beneficial division of labour among nations. Free and open trade allows each nation to expand its production and consumption possibilities raising world‘s Living standard. Protectionism protects the forces of comparative advantage form to maximum advantage.
However, there is dissatisfaction among less developed countries (LDCs) as to the virtue of completely free trade and most such countries feel that it is not the ideal policy for them. They feel that they are partners in global trade since the gains of trade are not equally share by the developed and developing countries. This very feeling gets reflected in the North South conflict which has created a demand for a new international order. Giving their level of poverty and some special problems which, they have been facing over the years. Developing countries often treats the Laissez faire prescription as in appropriate. So any discussion Of the role of the international trade in promoting economic development must take into account the special problems faced by the developing countries and the Policy constrains they face in tracking them.
Trade undoubtedly has several benefits; its promotes growth and enhances economic welfare by stimulating more efficient utilisation of factor endowment of different regions and by enabling people to obtain goods from efficient sources of supply. Trade also makes available to people. Goods which cannot be produced in their country due to various reasons.
The role of trade In enhancing consumers choice is tremendous. The foreign trade multiplier shows how an injection of Income arising out of trade can lead to economic expansion. According to A.C cairn cross. As often as not, it is to develop the knowledge and experience that makes development possible and the means to accomplish it.
Cameroon on the Gulf Of Guinea is a Central African country of varied terrain and wildlife. Its inland capital Yaoundé and its biggest city, the seaport of Douala are transit points to ecotourism sites as well as beach resorts like Kribi. Cameroon is bordered by the Central African Republic, The Republic of Congo, and Gabon, Equatorial Guinea, Nigeria and Tchad. It has seaport such as the Douala seaport, Kribi seaport, Limbe seaport and Garoua seaport. The Douala seaport is the busiest and most important and controls about 90% of total seaborne traffic into and out of the country. Cameroon is ranked 163 among 190 Economies in the ease of doing business. According to latest World Bank annual ratings. The rank of Cameroon improved to 163 in 2017 from 167in 2019 ,Ease of doing business in Cameroon average 165.80 from 2008 until 2017 reaching all time high of 171 in 2009 and record low of 161 in 2011(trading Economy 2018).According to the 2016 list of Countries by merchandise imports. Cameroon was ranked 113th in the world regarding the value of goods imported with a total import value of 5630.000 000 ( Mandrus 2018).
In 2017 Cameroon major trading partners, Countries for exports were Italy, China, France, Netherland and Spain and for imports they were China, France, Thailand Togo and Nigeria.
the research was conducted in Cameroon in Littoral Region within the head quarters, Douala seaport. The city of Douala is located on the bank of the wouri river linked by Bonaberi bridge. The city of Douala is divided into seven districts (Akwa, Bassa, Bonaberi, Bonanjo, Bonapriso, NewBell and Deido) and it has more than 120 neighbourhood. Akwa is the Douala busisness district and Bonanjo is the administrative district.
The research titled challenges on used cars importation at the Douala seaport and its impact on importers. The research was conducted in 2022 which chapter one was written in the month of March, chapter two in the month of April, chapter three May, chapter four and five in June and the interview guides were issued and data analysed within the month of June.
The study was conducted with the theme challenges on used cars importation at the port of Douala and its impact on importers and focus only within the theme and no other aspects which are not related to, so as to get the real insight of the study.
Cameroon as a lower-middle- country, it Government officers appointed to lead importation terminals have little knowledge of the requirements needed to conduct these institutional structures successfully.
The consequences are therefore standing structures with a Laiser fair Style of leadership, vast bureaucracy, little or no accountability and non-respect on due process, over documentation.
In Cameroon port of Douala, in Particular, a lot has been said and even more left unspoken about the environment of importation. Popular opinions hold that the current atmosphere is plagued with a lot of ills. Such as corruption, bureaucratic red tape, overpriced services and a growing backlog have combined to put a major drag on cargo trade through central Africa‘s largest harbour. Consequently, there are testimonies of abandonment of imported goods at the seaport for long period of time and over congestion. The procedures for clearing goods are a permanent headache and very little get done without greasing palms with extra cash traders says. Also, other opinions are that high level of corruption and bribes are just one of the obstacles. It takes 20-22 different stamps to take a car Out of customs. In the offices staffs are incredibly slow which causes catastrophic delays. However, the above testifies and Opinions regarding importation challenges on the Douala port are not conclusive because no exciting study is available to ascertain such claims. This has motivated the researcher to find out and address the following main question.”Challenges on used cars importation at the port of Douala and it’s impact on the importers ‘‘such form the bases for this research.
The researcher seeks to answer the following research questions
what are the challenges on used cars importation at the Douala seaport and its impact on the importers?.
what are the characteristics of used cars?
What are the challenges faced in clearing the used cars?
What are the effect of the challenges of imported cars on importers?
1.5) Research Objectives.
1.5.1) Main Objectives.
The main objective of this study is:
To identify the challenges on used cars importation at the port of Douala and its impact on the importers.
1.5.2) Specific Objectives
Specifically this study seeks:
To identify the characteristics of used cars.
To enumerate some challenges faced in clearing used cars.
To determine the effect of challenges of imported cars.
Further reading: Transport and Logistics project topics with materials