FG Approves $3.1bn for Customs Automation, Targets $176bn Revenue
Earmarks N13bn for automation of four airports
The federal government in pursuit of diversification of the economy is targeting $176 billion revenue from $3.1 billion concessionary investment for full automation of the operations of the Nigeria Customs Service (NCS).
The Federal Executive Council (FEC) has also approved N13.122 billion for the automation of four Nigerian airports and consequent transformation of the airports from their current analogue to full digital operations
Briefing journalists after the 14th virtual Federal Executive Council (FEC) meeting in the State House, Abuja yesterday, the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, said whereas some services of the NCS are automated, the vast majority of them are still analogue and hence, the necessity to bring the entire operations of the agency to full modernisation and automation for optimum output.
According to her, the $3.1 billion project, which she said would not cost the country a dime, would be concessioned to E. Customs HC Projects Nigeria Limited for a period of 20 years.
She listed sponsors of the project as Bionica Technologies West Africa Limited, and Bargain Securities and Supplies Nigeria Limited.
She also listed the Africa Finance Corporation (AFC) as the lead financier and Huawei Technology as a technical service provider.
She explained that the $3.1 billion approved yesterday was an anticipatory contract for customs’ full-fledged transformation.
She said: “The purpose of the memo we presented to council was for a project that will enable the complete automation of the Nigerian Customs Service (NCS) processes and procedures, using the application and information technology in all aspects of customs’ administration, in favour of a firm known as E. Customs HC Projects Nigeria Limited for concessionary period of N20 years.
“The main objective of this project is to completely automate every aspect of the customs’ business and to institutionalise the use of smart and emerging technologies that will enhance the statutory function of the Nigerian Customs’ Service in the areas of revenue generation as well as trade facilitation and enhancement of security.
“The total cost of the project is in the sum of $3.1 billion. The consortium, the PPP group that has been approved is led by Messrs Y. Technologies with four other members.
“The committee that led this process also looked at the national trade impact process that has been going on for years and confirmed that the Nigerian e-customs’ project is a subset of the National Trade Impact and would prefer the Nigerian Customs to play its lead role in the national trading platform.
“The Bionica Technologies West Africa Limited, Bargain Securities and Supplies Nigeria Limited are lead sponsors and co-sponsors. We also have the Africa Finance Corporation (AFC) as the lead financier and Huawei Technology as a technical service provider.
“So, council today ratified Mr.
President’s approval for the PPP concession for a 20-year period to Messrs E. Customs HC Project Limited as a concessionaire for the delivery of customs modernisation project.
“This is a project that will not have an immediate cost to the government. The investors are providing all of the financing and this revenue will be deployed in three phases and they will look over the investment in the concessionary period of 20 years.
“The key point is that it is not costing the federal government one thing. The $3.1 billion being proposed will be sourced by the sponsors and the partners.”
Ahmed who explained that the project would be implemented in phases, disclosed that these phases would involve a capital investment of $1.2 million in three years and $1.1 million projection of operational cost during the 20 years of implementation.