Mr. Eric Kweku Hammond, the Bank of Ghana’s (BoG) Deputy Director in charge of Foreign Banking Operations, has counseled exporters to be proactive in acquiring Letters of Commitment (LOC).
The LOC is a web-based export document that makes it easier for export proceeds to be returned to Ghana.
Proactiveness, according to Mr. Hammond, would aid in the avoidance or encounter of some bottlenecks in the exportation process.
He urged exporters not to wait until their goods were at the ports and ready for shipment before beginning the acquisition processes for LOC or seeking resolution to challenges associated with its acquisition when speaking at a Ghana Ports and Harbours Authority (GPHA) forum tagged the “Eye on Port.”
He noted that the LOC has been in use since 2016 and mentioned that its importance includes allowing the country to obtain the needed foreign exchange to pay for its huge import bills; shoring up the national reserve; strengthening the cedi; contributing to national development; and ensuring consistency in export data.
He said exporters must take advantage of the digitalisation of the LOC system which has made it convenient for them to apply for extensions that have a turnaround time within an hour.
The BoG Deputy Director stated that exporters who wish to apply for extensions beyond the 60-day allowable period do so well ahead of time.
He explained that “If you foresee that you are unable to repatriate the export proceeds for your initial export within the 60-day period, there is a query system in the LOC regime that allows you to apply for an extended period and the Bank of Ghana will gladly extend the period for you to enable you to repatriate the proceeds.”
He reminded exporters that the Integrated Customs Management System (ICUMS) which hosts the LOC system could block subsequent export transactions after non-compliance with the LOC regime.
He disclosed that defaulters of the law that supports the LOC could face a fine or imprisonment for up to ten years.
