- Nigeria, Benin Republic consider harmonizing Import Prohibition Lists
Comptroller Dera Anselm Nnadi mni, began his reign as Customs Area Controller of Tin Can Island Port (TCIP) Command yesterday with a maiden press briefing where he explored numerous issues around the Nigerian-Benin trade relations. Nnadi who was overseeing customs activities at Seme/Krake border until last week, gave an insight into the recently endorsed pact between the leadership of Nigeria Customs Service (NCS) and Benin Republic Customs, even as he sought media collaboration to enhance Customs performance at Tin Can, under his administration.
The News Diet was there to capture the distinguished Customs officer’s position on harmonizing prohibition lists, removing perceived barriers to trade, the SIGMAT innovation to track goods in transit and preventing smuggling, among other issues.
Coming from Seme Border at a time Nigeria and Benin Customs administrations signed a pact on trade, tell us the benefit for Nigeria and how best can this address issues arising from goods in transit?
The leadership of Benin Customs were here as a follow up to earlier visit to them by our Comptroller-General of Customs (CGC) Adewale Adeniyi MFR. We have to ask ourselves if the manufactured goods in Nigeria are in excess where do we take them to? Are we taking them to Europe where they already have those goods?
Exports from Nigeria to Europe are mostly are oil and gas or raw materials. Can you take Coca-cola to the United States of America where the headquarters of Coca-cola is? Is it possible to take furniture from here to Europe, Turkey, Morocco? Can you take textile from here to China? Think about it. Those that would buy these things from us are our neighbours.
However, my experience with Seme Border is that goods move from Gambia, Togo, Senegal, Ivory coast, Burkina Faso to Nigeria and they pass through Benin.
If they must pass to Niger too in transit, being a landlocked country, they pass through Benin into Nigeria before entering Niger and we thought about it and realized that these people are strategic partners. If they close their borders the way we closed ours, what happens?
When I went to Seme the impression was that agreement in real term is to promote regional trade and don’t forget, we will still entered the African Continental Free Trade Area (AfCFTA) Agreement. All it will take this people to do is to invite companies to establish in their own countries and manufacture.
Everything manufactured in Africa when this thing takes place is now duty free, so what do you do? Start protecting! We also found out that most of the business challenge we have is that what we prohibit in Nigeria comes into Benin Republic freely. Used clothing comes there freely, they didn’t prohibit it.Frozen poultry products which we banned, goes in there freely because they didn’t prohibit it. Parboiled rice goes in there freely, but we have banned it completely from land or seaports. It is also the same for used vehicles of certain age that get into their country. The question is when these things land in Cotonou with their small population, why do they end up here Nigeria?
Instead of deploying several resources to checkmate this, why not get smart about it? They offered this idea that we can come to their country and examine these things and stop it there before it comes here. That was a good idea because the main clause for us is that we are harmonizing our prohibition list.
Whatever we prohibit in Nigeria, they will also prohibit. That is the first gain we are making. They have also offered that if you are in Nigeria and you import something that is not prohibited through their port, NCS can come into their port in our own uniform and they will examine the container, the agent will pay duty there, and the money will be transferred to Nigeria. However, they asked for something in return. They said we know that one of the main things that they do is rice import. If they decide to ban rice importation as we have banned it, how do they survive? They said it should be gradual process.
We will not just say no more rice from Cotonou. It is a sovereignty, but we can say if we are importing 5 tons a year, we can start by saying we will reduce it to 3 this year, they will compensate us. Next year we will reduce by 1, they will compensate us until within a time frame we will stop importing completely. By then they must have found an alternative for their economy. That is what they are saying. It is not as if Nigeria is losing.
Going by these postulations, wouldn’t Nigeria be taking away scarce port business opportunities to Benin Republic?
Life is about competitiveness and that is where all of you here will help. Why is it that from Nigeria to Ghana by ship is 2 hours and 3 hours maximum? Nigeria to Cotonou port by ship is 1 hour maximum, yet Nigerian shippers prefer to go to Cotonou to clear their cargoes. That means our business process here should be addressed.
If we put our house in order, would anyone go outside to buy? We both have water. If Niger goes to Cotonou to import, I can understand because they are landlocked. What about Nigerians that have water bodies and six seaports or more in the country? This simply means we should do something here collectively to address the situation.
When they closed Niger border, some people came to Seme to say can we pass through Seme and I said why not? It’s free but I asked a man why he is not passing through Nigerian ports because he wanted to move cargo from Cotonou to Sokoto and Kastina. He said he didn’t he pass through Nigerian ports to Sokoto because of the bad state of the roads he would pass through. For the man, his challenge is not the maritime industry, his challenge is the road infrastructure. I asked about what he will do when he moves from Cotonou port and he said he will offload into trucks and go to Kastina and Sokoto through Niger border. When I pressed further to ask why he couldn’t do the same thing here in Nigeria, he said would have to pay for demurrage. He said before he gets to Kastina from the seaports, pilfering, damage and insecurity will stop him because the road is not good. Although he will travel for longer period via Cotonou to Kastina, he was certain his goods will be intact.
We need to address some of these infrastructural and social deficits. Talking about interconnectivity, we have it and it is part of the company that is called SIGMAT. People were asking for reasons why we are using SIGMAT and why can’t we get our own ICT infrastructure? SIGMAT is actually an ECOWAS product. Some Customs officers from Nigeria were part of the development, but somehow, we didn’t key in. Burkina Faso, Ghana, Senegal, Cote D’Ivoire, Cotonou are all using SIGMAT to connect.
As part of this agreement, we are working on SIGMAT. As a matter of fact, even while we were holding that meeting, ECOWAS and our officers were working on it and we will soon key in too.
With this development, are you saying very soon the border will be open to importation of vehicles and rice?
This thing they said is an agreement, but the framework for its actualization is yet to start. But the media has already written it as if the meeting will start tomorrow. No!
A committee will still be set up. Government will have to endorse it. It is just like an idea based on the fact that it is already working elsewhere. Other countries in Africa are doing some of these things already.
If you go from your port to another person’s port to carry container, you will pay before it comes to your own place. Other countries are doing it. That is regional integration.
When you travel intercontinentally and fly Lufthansa from Nigeria, they will check you in Nigeria and the next check will be in Frankfurt and once you are checked in Frankfurt, nobody checks you again in other European country. That is exactly what we want to do. If you are carrying Potato from Denmark to Belgium, once they check you between Denmark and Belgium, until the Potato enters London, France, or USA , nobody checks you again. Why can’t we do it here? Why are we always making things look so difficult?
We are not bringing rice. They are saying they will stop importing rice for our sake since we don’t want it. It is not automatic but it is a proposal made and we both signed to commit to that proposal. If the committee works out, we will achieve it, but that is just what we have done.
Another thing which we discussed that is very important is transit fees. If you are moving cargoes from Cote d’Ivoire for instance to Nigeria like Lever Brothers or Cardbury for example, not the exact figure please. Assuming you pay 2 naira as transit charge administrative charges from Cote d’Ivoire to Togo to Ghana, that same cargo you are paying 2 naira for each country, the moment you get into Benin Republic, it increases from 2 naira to N1000. That is what we are protesting.They over charge Nigerian goods in transit. Where other countries like Ghana are charging us 5 naira, Togo will charge us 5 naira; once it enters Cotonou, it becomes N10,000. This is part of what we discussed that they should also reduce but they also complained that when they come to Lagos to buy things, and they want to go back to their country, we have more than 80 checkpoints that also allegedly collect money from their traders and there is no receipt issued. We also agreed that we will remove those checkpoints.
We removed check points, barriers to trade, they will also reduce cost of transit. Someone is giving something and the other is taking just like what we are doing but nobody has opened the border for things to start coming in. By September 29th, 2023, the committee will start sitting while the ICT people are meeting.
Let us take a look at the area of the revenue as it concerns Tin Can. Some years ago the Central Bank of Nigeria (CBN) excluded 41 items from accessing forex, meaning that the importers would have to go to black market to buy dollars. Has this been reviewed?
Part of the challenges that traders are having now is floating exchange rate. Before, there were about 4 tiers of exchange rate. We had the government rate, student rate, customs rate, one for those who wanted to pay children’s school fees abroad and the one for those who were traveling, then the black market. But with floating exchange rate, everything has collapsed.
Hitherto, before you can transfer $10, 000 to pay your children’s school fees, it was a big deal. Now, that window has been given to you. Go to the bank and transfer money to your children based on what you have. Before, you had to apply to CBN. It will take time. You can queue for up to 2-3 months and you will not be given window to pay your children’s school fees. The floating exchange rate has accommodated that already.The idea was that the importers of 41 items cannot source money from government to import them. That window has been thrown open for everybody.
However, for every policy, if there is government issue there must be reversal. Perhaps at the end of this year, when the government announces the next fiscal policy maybe they will revisit it and say even though we are floating naira this particular policy based on this and we are officially withdrawing it.
When you source your own money, Customs is not stopping you from traveling with it. That is another misconception people have. Declare your income source to Customs and we will sign the fund. If you have as much as $10, 000, and you don’t declare, we will seize it. I am looking forward to the day we will be able to export more than we import. That is part of my dream which we are doing all we can to discourage import and consume locally.
Don’t you think this pact will adversely affect ports in Nigeria and make our country a dumping ground of some sort?
Competitiveness is the soul of business. This fear came up when we were about to start ETLS and when we were debating on Trade Facilitation Agreement TFA. People were asking how Nigeria will become a dumping ground.
The idea is competitiveness. I asked a question that what makes Cotonou port attractive and ours not attractive. It is a simple thing. If you are the port operator here, and you are scared that because of that you can’t compete then make your place conducive for trade. It is about competitiveness.
We should improve our business process so that we can attract patronage. There are some airlines that are very cheap but someone can decide not to buy their tickets but rather buy expensive ticket because the route is either shorter or the services rendered by the people are better.
Before this policy was made Nigerians have been going to the Cotonou port, the question is why were they going there in the first place. It is not as if it is something new, and I have cited an example of regional integration everywhere in the world.
This is just part of it. We should remove some of these fears that we have and believe that it is good for the sub-region. Sometimes, we should also not act selfishly by saying we can’t do it. If you see the volume of trade going on across the border, even when we think nothing is happening you will know the economic significance of the countries around us .
Imagine if Benin says Dangote should not pass through their place again to supply cement to Togo. On daily basis, 25 Dangote trucks cross the border. What if they tell them that they can’t cross again? They are not the ones buying the cement.They supply to other countries but they must pass through their roads.
We should not think we are losing trade here by going there and through their own corridor you are providing employment for people in Dangote. There is no ship that will transport those things from here to those countries.
In the past, if you wanted to fly to Niger from Nigeria, you will first fly to France and then fly back to Niger. Can you see the importance of regional integration? I can now fly from Abuja to Niamey in Niger or to Togo and other places. Yet, there is no cargo that can take ship from Nigeria to Ghana directly.