Thursday, 4 May 2017
Major Reforms In Nigerian Customs Service. cc @DrJoeAbah
One of the most crucial functions of the Nigeria Customs Service (NCS) is the promotion and facilitation of trade and competitiveness. We will be the first to admit that the reality at the Nigerian ports is challenging and can be improved upon.
Depending on who one asks, what you are likely to hear is that, export processes average between two (2) and three (3) weeks in Nigeria, compared to only four (4) days in Kenya etc. Nigeria requires up to fourteen (14) documents for imports, compared to just five (5) in Rwanda. Factors like these are responsible for the country’s lowly rank of 14th out of 15 ECOWAS economies and 182nd out of 190 economies worldwide in the ‘Trade Across Borders’ indicator on the most recent World Bank “Doing Business” Rankings.
Nigeria’s desire to restore growth through economic diversification, as enunciated in the recently released Economic Growth and Recovery Plan (EGRP) of the Federal Government requires a holistic reformist approach. Reforming procedures is required to stimulate important sectors of the Nigerian economy like agriculture and manufacturing, which contribute 23.1 and 13.3 percent respectively to its Gross Domestic Product.
On February 21, 2017, the Comptroller-General of Customs (CGC), Col. Hammed Ali (Rtd.), was among several heads of Ministries, Departments and Agencies (MDAs) who gathered at the Conference Room of His Excellency, the Vice President, Prof. Yemi Osinbajo (SAN) for the launch of the 60-Day National Action Plan on Ease of Doing Business by the Presidential Enabling Business Environment Council (PEBEC).
As a key stakeholder in the FG’s quest to make businesses work, the NCS joined other MDAs in making commitments towards delivering reforms that would progressively make it easier for businesses in Nigeria to start and thrive. Our commitments at the NCS are focused on “Trade Across Borders,” where a target was set to reduce import and export time by up to 50 percent, and ensure that import procedures adhere to international standards.
A major first step was taken to achieve the target when the Department of Home Finance of the Federal Ministry of Finance revised Nigeria’s Import and Export Guidelines following a directive from the Honourable Minister of Finance, Mrs. Kemi Adeosun, to streamline current procedures.
The Guidelines addresses some of the issues causing inefficiency and delays at the ports. Several of the newly inserted clauses in the Guidelines relate directly to the operations of the NCS. I will attempt to explain the stipulations and implications of the revised Guidelines in this piece as it pertains to the NCS.
The NCS is now required to schedule and coordinate the Mandatory Joint Examinations and sign-off Form to ensure that there is only one point of contact between importers and officials.
Before this intervention, the burden was on importers to reach out to all relevant agencies and the Terminal Operator to schedule a suitable time for the joint examination of cargo. We have however decided to take this tedious process off the backs of the importers and coordinate same.
Similarly, the minimum cargo placement notice time for examination required by Terminal Operators has been reduced from twenty four (24) hours to a maximum of twelve (12) hours. This means that after the NCS agrees with all parties on a suitable time for physical examination, Terminal Operators now only require a twelve (12) hour notice to place the cargo for examination.
Under the revised Guidelines, Shipping Lines are required to electronically transmit advanced manifest of their cargoes to the NCS and the Nigerian Ports Authority (NPA) as soon as the vessel departs the last port of call – this is to ensure there is enough time for risk assessment, profiling and optimised placement of cargo. NCS Officers will then circulate the cargo manifests to other examination agencies and the Terminal Operators as soon as same are received from the Shipping Lines. Shipping Lines which fail to transmit the advanced cargo manifest may be denied berthing rights.
The above guideline is critical because one major reason for delays at the ports is the less than optimal cargo placement and offloading processes.
Most times, Terminal Operators are unaware of the contents of a container and are thus unable to determine if same requires physical examination or not. With prior knowledge of contents, Terminal Operators can ensure that containers which do not need physical examination and would consequently require less time to offload are placed ahead of those that will require examination in order to prevent delays and pileup of cargo.
Another reason for the delays at the ports during the import process is the haphazard manner in which goods are packed in containers. Different types of goods are just dumped in the container and imported into Nigeria, slowing the pace of physical examination and making it impossible for modern equipment to be used to examine containers.
To solve that problem, Shipping Lines are now required to ensure that imports into Nigeria are well arranged in pallets. Shipping Lines which fail to ‘palletise’ cargo will be sanctioned and and maybe asked to take back onboard the non-palletised cargo.
Even beyond the 60-Day Plan, which came to a close on April 21, 2017, the NCS is already collaborating with other stakeholders to further reform the import and export processes. Our efforts are strengthened by the complete support of the Federal Government, through the PEBEC, chaired by His Excellency, Vice President Yemi Osinbajo; the Federal Ministry of Finance; and other stakeholders.
Reduction of documents required for the import and export process will continue to engage the attention of relevant authorities in recognition of the fact that Nigeria presently requires more documents than most of its peers.
Finally, the on going move by FG towards the establishment and launch of a National Single Window (NSW) will contribute to the attainment of seamless interface by all stakeholders in the import and export chains. It will achieve an electronic, one-stop shop portal for Nigeria’s cargo clearance procedures.
The strong steering committee co-chaired by the Comptroller General of the NCS, Col. Hameed Ali (Rtd.) and the Managing Director of the NPA, Hadiza Bala Usman demonstrates government’s desire to entrench more business friendly environment for importers, exporters and investors wishing to do manufacturing business in Nigeria.
We intend to show Nigerian exporters and importers through our actions that the NCS is not just a ‘tax-collecting’ agency, but a progressive partner determined to make it quicker, cheaper and easier for exporters and importers to trade and carry out their legitimate business operations through the Nigerian ports.