Covid dents Ctg port performance

Average waiting time for vessels at the Chattogram Port jetties for loading and unloading containers increased by around seven hours in 2020 compared to that in 2019, causing sufferings to businessmen with increased cost of doing business.

The year 2020 was the most costly in terms of the time required for vessels to unload and reload containers, known as "turnaround time," since 2014.

Average turnaround time at the Chattogram Port has increased from 2.62 days (62.88 hours) in 2014 to 2.93 days (70.32 hours) in 2020. 

According to the Chattogram Port Authority (CPA) data, the turnaround time was 2.63 days in 2019, 2.84 days in 2018, 2.63 days in 2017, 2.87 days in 2016, 2.67 days in 2015 and 2.62 days in 2014. 

In 2020 the performance of the port slumped amid the 8% negative growth in container handling and 2% negative growth in berthing vessels. 

When contacted, CPA chairman Rear Admiral SM Abul Kalam Azad told The Business Standard, "The turnaround time abnormally increased in April and

May for Covid-19. After taking some remedial steps after May 2020, it has now come down to a tolerable level."

"In 2021 we hope that the port activities will be more accelerated facing the second wave of Covid-19," he said.

Regarding the negative growth, he said, "During the Covid-19 period this negative growth is positive for us as our negative growth is only 8% which is lower than that in other countries."  

Businessmen also appreciated the steps taken by the port to tame congestion during the Covid-19 shutdown, but called for a permanent solution by expediting the construction work of the ongoing projects to reduce turnaround time at the country's premier port.  

They said the delay at the port, which handles 90% percent of foreign trade, enormously impacts the economy, including the country's most competitive export product – readymade garments. 

Stretching the turnaround time also pushes up production and freight costs, which in turn cause businessmen extra expenses.

Businessmen have to pay between Tk8.5 lakh and Tk12.7 lakh per day as demurrage when a vessel overstays at the port. 

They cover the extra costs by demanding higher prices for their commodities, causing sufferings for the consumers.

According to the 2019 report of the United Nations Conference on Trade and Development (UNCTAD), Bangladesh was lagging behind India, Sri Lanka, Pakistan, Myanmar and Malaysia in terms of turnaround time.

The UNCTAD said the turnaround time for Bangladesh was 3.03 days (72.72 hours) in 2019, while it was 0.91 day (21.84 hours) for India, 0.83 day (19.92 hours) for Sri Lanka, 1.21 days (29.04 hours) for Pakistan, 2.04 days (48.96 hours), and 0.75 day (18 hours) for Malaysia.

The UNCTAD said, "A shorter time in port is a positive indicator of a port's efficiency and trade competitiveness."

Traders said the cost of doing business has surged due to a worldwide supply chain disruption during the Covid-19 and the tardy port performance from April to May 2020 also contributed to shooting up costs. 

How Covid-19 costs business 

When the Bangladesh government enforced a countrywide shutdown in March last year to prevent the spread of novel coronavirus, the vessel turnaround time at the Chattogram Port shot up to 16-18 days as the countrywide supply chain disrupted. 

During the shutdown a massive stockpile of containers accumulated at the port yard, leading to vessel congestion at outer anchorage and jetties.  

However, the port had started to return to normal after the CPA decided in May 2020 to waive Tk188 crore in storage rent for importers to encourage them to take delivery of goods. 

Transferring around 17,000 twenty-foot equivalent units (TEUs) of containers to private Inland Container Depots (ICDs) also helped reduce congestion at the port.

On November 2020, feeder vessels operating to and from the Chattogram Port, Colombo Port, Singapore Port, and Port Klang have issued a notice to impose surcharges of $75 per goods-laden 20-foot container and $37.50 per empty container creating congestion as an emergency cost recovery surcharge (ECRS).

The Bangladesh Garment Manufacturers and Exporters Association (BGMA) has demanded the withdrawal of the congestion surcharge imposed by feeder vessel owners since 15 November 2020 which is under discussion now. 

What solutions businessmen recommend? 

The businessmen said although the volume of containers and vessels handled at the Chattogram Port has almost doubled in the last seven years, the number of jetties there has not increased accordingly. 

The port has only 19 jetties for handling this increased flow of vessels and containers. The businessmen said there is no way other than increasing the capacity of the port to reduce the turnaround time.  

Chattogram Chamber of Commerce and Industries (CCCI) president Mahbubul Alam said, "As a part of expanding the port's capacity, we have to complete ongoing projects – Patenga Container Terminal, Bay Terminal Project and Matarbari Deep Sea Port – soon to reduce the turnaround time." 

BGMEA Vice President AM Chowdhury Selim said, "Delay caused by the port affects the production costs. But in 2020 the delay occurred due to the Covid-19 pandemic. Compared to the other years' turnaround time, 2.93 days of turnaround time during Covid-19 pandemic is satisfactory to us." 

"However, compared to the neighboring countries, we still have to improve a lot for ensuring smooth business operations," said Selim.