The Bank of Ghana (BoG) is taking the enforcement of laws on repatriation of export proceeds to another dimension with an enhanced education.
It
is part of an intensified effort to help deal with exporters who flout section
15 of the Foreign Exchange Act, 2006, Act 723, which relates to export
activities and repatriation.
Per
the act, exporters are expected to repatriate proceeds from merchandise exports
in compliance with the Letter of Commitment (LOC) regime.
The seminar
It
was for this reason that the Ghana Shippers’ Authority (GSA) in collaboration
with the BoG held the seminar to sensitise exporters in the Bono, Bono East and
Ahafo regions.
The
seminar, which took place in Sunyani on Tuesday, August 9, focused on Letter of
Commitment requirements for the repatriation of export proceeds.
It was the first in a series to be
held across the country this year. The seminar followed engagements between the
GSA and the BoG after several complaints from exporters and some custom house
agents regarding the implementation of the LOC since its introduction in 2016.
Compliance
Taking
participants through the legal framework of the LOC, the Head of Foreign
Operations at the BoG, Mr Eric Hammond, urged exporters to strictly comply with
the law in order not to be prosecuted.
“The
LOC is a document required to accompany every merchandise export leaving the
country. And so, the LOC is a commitment on the side of the exporter to assure
proceeds from goods shipped out will be repatriated in compliance with the law.
“So,
the forum today is to address issues affecting operationalisation of the LOC
regime. This forum was ,therefore, held to build the capacities of these
exporters so that they will be able to understand issues relating to the LOC,”
he said.
He explained that the LOC was a
mandatory requirement for all exports moving out of the country.
According
to him, exporters who fail to repatriate proceeds through an external bank are
in breach of Act 723 and are liable on summary conviction to a fine of not more
than five thousand penalty units or to a term of imprisonment of not more than
ten years or to both.
Recalcitrant shippers
Under
the LoC regime, the head maintained that recalcitrant shippers were often
blocked from undertaking any export activity in the country.
“The backbone of the regime is the
Foreign Exchange Act implemented by BoG and so because the system has been
automated, recalcitrant exporters are blocked periodically.
“Once
an exporter is blocked, it will be difficult for the person to engage in export
activity in the country using the shipment procedures.
“A
list of these exporters is then prepared every week and forwarded to the
security agencies, especially the CID for further investigation and
prosecution,” he said.
The Chief Executive Officer (CEO) of
the GSA, Benonita Bismarck, in her opening remarks, observed that the
challenges with the implementation of the LOC included inadequate time
allocated for the repatriation of export proceeds and blocking of subsequent export
transactions for non-repatriation of proceeds beyond 60 days.
“The
others were delays in accessing repatriated proceeds from commercial banks, low
exchange rates offered by the banks, high commissions charged by commercial
banks, and the unsuitability of the current form of the LOC for small-scale
cross border trade.”
She
noted that most of the problems faced by exporters stemmed from non-compliance
and inadequate knowledge of the procedures involved, hence the collaboration
between the two organisations to remove these bottlenecks.
Non-traditional export
On
his part, the Kumasi Branch Manager of the GSA, Isaac Tersiah Ackwerh, noted
that Non-Traditional Export (NTE) earnings for 2021 amounted to about USS$3.3
billion, which was an increase of 17 per cent over the 2020 figure of US$2.846
billion.
He
said this clearly indicated the importance of the repatriation of export
proceeds to the country, and therefore, the need to comply with Section 15 of
the Foreign Exchange Act, 2006 (Act 723).
Source:graphic.com.gh