Duty hike pushing importers, agents out of business
THE consistent hike in Customs duty exchange rates for clearance of goods at the ports is forcing bonded terminals, importers and agents as well as truck owners out of business.
This comes as a report by Vessel Finder. com said no container vessel is billed to call at Nigeria’s busiest port, Lagos Port Complex, till the end of March 2024.
An outlook on the Automatic Identification System ( AIS) of Nigeria’s nautical space shows that of the 19 vessels billed to call at Lagos port, none is a container- carrying vessel.
Also, as Nigeria faces turbulent trade times with the continuous decline of the naira, importers are currently diverting their cargoes to neighbouring countries, while those at the nation’s ports are gradually turning to abandoned and overtime cargoes due to the high cost of clearance coupled with other terminal charges and demurrages accrued.
Also, a source in one of the bonded terminals said cargoes received at the terminal have declined drastically, noting that some operators are gradually going out of business.
The Head, the Customs and Trade Facilitation Committee of Importers Association of Nigeria ( IMAN), Ajanonwu Vincent, said the upward adjustment by the Central Bank of Nigeria ( CBN) is meant to punish Nigerians for the benefit of the rich political elites as well as weaken international and local trades.
“The ports are dying, the bonded terminals are shutting down, agents are dying, and importers are dwindling in number. By September this year, NCS will see no importer to levy heavily and extort mercilessly. The government will then reverse the gear with some apologies.
“One thing these fiscal policymakers seem to always forget is that the businessman must survive and make his profits at the time of the worst economic policies. It is the masses, the poor, the aged, the children and future generations that will suffer the consequences,” he stated.
Vincent said Nigerians will die in their millions this time around while calling for massive importation of food from Thailand, China, the United States of America ( USA) and other benevolent countries of the world to address food scarcity caused by the fiscal policies.
He also stressed that until importers, exporters, shippers and consolidators are allowed to contribute to international trade policies and manage the trade, Nigeria will continue to gamble with every idea conceived by the political class.
Recall that the CBN adjusted the Customs exchange rate on February 2 to N1,356.883/$ and on February 3, it was raised to N1,413.62/$ and on February 10, it was changed to N1,417.635/$.
The rate was further adjusted on February 3 to N1,444.56/$ 1, while on February 14, was readjusted to N1481.482/$ 1 and then to N1515.092/$ 1 on February 15, 2024.
Reacting to the development, a former chairman of the Association of Nigeria Licensed Customs Agents ( ANLCA) at Seme Border, Bisiriyu Lasisi Fanu, said the frequency at which the CBN is adjusting the exchange rate has become worrisome, which is why there is so much overtime cargo at the ports.
He said the hike in Customs duty through high FX rates would affect all goods in the market as every commodity has imported input in them.
A trade and supply chain expert, Bello Abubakar, predicted a looming massive diversion of Nigeria- bound cargo to neighbouring countries, insisting that the country would be the ultimate loser in the end.
The supply chain expert said the international trading public was just beginning to build confidence in Nigeria’s port systems following the introduction of some reforms that have brought a level of efficiency at the seaports, coupled with a relatively stable duty foreign exchange rate over the few years.
He, however, expressed fears that the trading community might begin to route their shipments through African neighbors, especially Togo and the Republic of Benin, where the duty rates are more stable and ferry the same consignments into the country under various guises, especially given the porous nature of Nigeria’s land borders.