Business

Lingering challenges impede trade facilitation

 

 

Importers and exporters have said that the method put in place to exit cargoes from the port have negatively affected trade facilitation in the country, BAYO AKOMOLAFE reports

 

Over the years, port users and operators have been facing lingering challenges of infrastructure, logistics, policy and regulatory inconsistencies, overlapping functions and duplication of roles among government agencies, leading to bureaucratic red tape, constant delays, high costs, and illegal charges.

 

The Executive Secretary of the Nigerian Shippers’ Council, (NSC) Hassan Bello, for instance, had said that the terrible condition of the roads and other challenges had made it impossible for importers to clear goods from terminals within the three days allowed and return empty containers within four days.

 

Loss

 

Because of this, it is estimated that Nigerian exporters are losing $10billion annually due to difficulties in accessing the nation’s major seaports, while a minimum of N2.5 trillion in revenue is lost annually within the Apapa business community.

Already, Lagos Port has been classified among the worst ports in the world due to challenges relating to delay of import/export processes, traffic congestion, poor access to termi nals and insecurity of cargoes.

Challenges

Bothered by the challenges, the International Monetary Fund (IMF) report classified Nigerian port among the worst ports in the world due to challenges such as delay in import/export processes, traffic congestion, poor access roads and security concerns, saying that maritime contribution to the nation’s Gross domestic Products (GDP) stood at 0.05per cent compared to 1.4per cent in South Af rica and 3 per cent in Kenya.

Imports

The latest data from the National Bureau of Statistics (NBS) also noted that the sector contracted in the six months to October, 2020 amid the economic fallout of the coronavirus pandemic.

While it explained that a total of N9.28trillion was spent on the importation of manufactured goods into Nigeria from January to September, 2020, the bureau stressed that manufactured goods imports into the country rose significantly in the third quarter of last year as the manufacturing sector was hard hit by COVID-19 disruptions, border closure, foreign exchange scarcity and extortion.

For instance, the Shippers Asso  ciation of Lagos State (SALS) said that there was no consignment cleared in all the ports without parting with some sort of under table payment.

It added that industries were no exception, saying that duty of five per cent on raw materials ran into 15 to 20 per cent during clearing processes as a result of overreaching of the valuation officers queries.

Export

On export, compulsory registration of Nigerian Export Proceed (NXP) number for cargo has suffocated export trade at the seaports.

 

Currently, it was gathered that more than 500 export cargoes were unable to access the port, while about 28 export containers were detained at the port, thereby leading to loss in foreign exchange.

For instance, the President of SALS, Jonathan Nicol, said that there was huge movement of export cargo during the harvest period in the third and fourth quarters of 2020.

He noted that the Nigerian Export Proceed (NXP) number compulsory registration had created a bottleneck that almost suffocated the entire export trade.

Nicol said: “Export cargoes were rejected for lack of space while exporters battled with registration on the central bank platform. So many export cargoes were detained, especially the exports from Minna Shippers’ Association for reasons beyond the exporters due to unworkable Federal Government import and export adjustments policies.”

The president urged the Federal Government to review some existing import and export policies, which he said had impacted negatively on imports and exports trade at the various port terminals.

He complained that the high tariff imposed on importers by the Nigeria Customs Service (NCS) have had adverse effect on their businesses, stressing that the high import duty regime had forced many importers out of business while others had relocated out of the country.

 

Nicol said: “The collapse of our import adjustments policies has affected imports drastically. The Nigeria Customs Service was given a blank cheque to pursue revenue at all cost thereby, militarising the trade platforms with gun tottering customs officers. Our customs tariff is unbearably high. The Nigeria Customs Service is an institution of its own that no one can talk to.

“So, whatever they say you must comply with. Official duty returns are inflated through the forceful duty regime and importers are  made to pay with tears.”

The president urged the Federal Government to restructure its import policies, noting that the customs external tariff had not been favourable to the country.

Nicol added: “The shippers association is very concerned now and we are mobilising to send an intervention team into the ports to protect our members.

We do not want any of the importers or shippers to be a target by an illegal compliant team when the port economic regulators are still in existence,”
He urged all freight forwarders to team up with the intervention team to checkmate excesses of government agencies, advising all freight forwarding associations to join the shippers to collaborate and solve the port problems.

 

Nicol said: “Shippers who have the inflated Peak Season Surcharge should please send their Bill of Lading to us. Shippers Association Lagos State will continue to seek resolutions to port-related issues with service providers through dialogues.”

Last line

There is need for the government to adjust its import and export policies to enable manufacturers and other port users do their business with ease.

 

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