The Incongruity of Customs Revenue Haul amidst Sluggish Imports

Yet again, the Nigeria Customs Service has declared huge revenue for 2018.

It made a haul of N 1.2 trillion, more than the N1.037 trillion it generated in 2017.

It has therefore become an annual ritual for the Customs to post impressive revenue figures which it labours to surpass at every succeeding year.

No doubt, the passion and capacity of the Customs to generate such impressive revenue figures every year deserves commendation and we give this in high dose to the boisterous and hardworking men and officers of the Service.

However, nigeriamaritime360.com is not as emotional for this annual revenue circus show as we are concerned about its incongruity to the prevailing circumstance at the ports.

In our past interventions, we have pointed out the anomalous situation of Customs’ unrepentant preference for revenue generation at the expense of trade facilitation, notwithstanding its half-hearted attempts to the contrary.

Besides that, the incongruities of the latest figures to the low imports experienced during the better part of 2018 stands out like a sore thumb.

During this period when the Customs declared a jumbo return, the ports witnessed sluggish cargo imports due to collapse in ports infrastructure and slow clearing process attributable to the out-dated 100 per cent physical examination as a result of lack of scanning machines .

The port access roads totally collapsed which greatly hampered quick evacuation and transportation of goods out of the ports.

This expectedly led to cargo glut as the terminals were congested, less vessels called at the terminals due to slow turnaround time of vessels.

Vicky Haastrup, Chairperson of Seaport Terminal Operators Association of Nigeria (STOAN ) captured the situation which prevailed during the period in her lamentation to the members of Senate Committee on Marine Transport .

“The volume of cargoes coming into the terminals is less compared with what we experienced about five years ago”.

She put the turnaround time of vessels to between 30 and 35 days, which led to fewer vessels calling at the terminals due to trapped cargo that gave no room to discharge more cargo.

This was as a result of the collapse of port access roads that inhibited prompt evacuation and seamless transportation from the ports.

Accordingly, she said her terminal which used to handle 17 vessels per months before the road mayhem, could only struggle to handle between three and four vessels per month, a situation we believed was common with other terminals.

We are therefore puzzled by the high revenue turnover of Customs in the midst of these challenges of low volume of cargoes and fewer vessels.

Then where did the huge figures come from?

Of course, from the imports and exports duties paid on these cargoes.

This seems a logical response to our inquiry.

But it doesn’t add up to get so much in a depressed import business with less cargo imports.

Again, the Customs Authority gave an explanation which may seem to have resolved this mystery.

In what we regard as self-praise, Hameed Ali, the Comptroller -General of Nigeria Customs Service, attributed the 2018 revenue harvest to the reform exercise that led to improved automation of Customs operations which he said has plugged all the identified revenue loopholes in the system.

This, to us, is commendable.

It shows that with the right mental attitude, commitment, motivation and enforcement of all the extant laws, customs revenue could even be higher.

These huge figures realised in 2018 even amidst multiple challenges, exposes the age-long sleaze going on in the revenue generation exercises of customs.

It then means that previous revenue figures, though commendable, which previous Customs administrations had gleefully declared even when there were less challenges as we witnessed in 2018 in the imports business, were pittance and a far cry from what they could had been.

It also means that the Federal Government had been scammed over the years in customs revenue declarations.

This further confirms that Hameed Ali merits our commendation.

However, that is as far as Ali and his men earn our accolades for the revenue haul.

We are disturbed, as we have always been, by the continued neglect of trade facilitation by the Customs to which they pay lips service.

Ali, just like his predecessors, only regaled his audience with his exploits in revenue generation.

Not for once in this annual ritual of revenue figures rendition have we been told about cargo release statistics from the ports.

We were never told to what extent trade has been facilitated at the ports, using automation process.

Rather, the automation processes have all been geared towards collection of maximum revenue, which is most often done at the expense of trade facilitation.

The situation is even grim under the present Customs administration which has to its credit an improved automation process and multi- layer security surveillance to checkmate duty evasion, under payment, import of contraband and smuggling.

But the question that is agitating our mind and other concerned stakeholders is how fast are these cargoes are being released from our ports?

What is not in contention is that Nigerian ports have one of the poorest cargo time releases in Africa.

For several years, the country had made relentless efforts to attain 48-hour clearance time to no avail.

Several measures, which were pursued half-heartedly by government and its relevant agencies, had been enunciated to attain the fabled 48-hour cargo clearance time in a bid to assume the much-coveted cargo centre in the West and Central Africa sub region.

Yet, self-imposed impediments have continued to rub us off the preferred cargo destination centre.

In recent times, Nigeria Customs Service, prompted and supported by the World Customs Organisation (WCO), had embarked on three Time Release Studies in a bid to determine the time cargo exit the port.

The exercise was conducted in 2006, 2010 and recently, September 2018 all geared towards improved cargo release procedures at the ports.

We don’t remember, to the extent our memory could be stretched, that any of these studies produced any tangible results.

At the risk of pre-empting the outcome of the latest release exercise, we shall be the least surprised if it goes the same way as the two previous exercises.

While other less fancied African countries with less maritime potentials have improved their cargo clearance time, Nigeria is still chasing the nebulous 48-hour cargo clearance time.

It may however be tantamount to stretching our luck too far if we compare our cargo time release with other advanced maritime countries where cargoes are being released under an hour.

In 2017, Joseph Attah, the National Public Relations Officer of Customs declared that export processes in Nigeria average between two and four weeks unlike the four days it takes in Kenya.

In that year also, Attah revealed that Nigeria requires up to 14 documents for imports compared to the five in Rwanda.

In 2017, Nigeria ranked 14th out of 15 ECOWAS economies and 182nd out of 190 economies worldwide in the “Trade Across Borders” indicator in the World Bank “Doing Business” rankings.

Even though these statistics have marginally improved as at 2018, but the situation still remains gloomy, more so when it is being alleged that multiple tables for extortion and to delay the process of goods clearance are now springing up at the Tin-Can Port.

In as much as we recognise that revenue collection is part of the statutory duties of Nigeria Customs, we also appeal, as we have previously done, that this task should not be done at the detriment of trade facilitation, which appears to be the case in recent times.

The World Customs Organisation (WTO) has shown undisguised passion for trade facilitation and thus encouraged member states to embrace the concept through its support and deployment of technology and knowledge-based seminars and workshops for its enhancement.

The global Customs body has always given special recognition and accolades to member states which cargo clearance time rank high.

We are not aware that the world Customs body has given a medal to any of its member state for making huge revenue hauls as the Nigeria Customs Service is good at.

So we encourage the Customs to deploy to trade facilitation the same passion, commitment and devotion it deploys to revenue generation.

As we have been advocating in our previous interventions, the final solution to the hiccups in clearance procedures and the quickest way to attaining the much coveted status of cargo centre in the sub region is to embrace the National Single window .

This, we believe, shall lead to the seamless interface by all stakeholders in the imports and exports chains that will result in an electronic, one-stop shop portal for Nigeria’s cargo clearance procedures.