Nigeria's port and cargo clearance environment is at an important point of transition.
The emergence of the Nigerian Ports Economic Regulatory Agency (NPERA ), reforms within the Nigeria Customs Service (NCS), the development of the Nigerian Single Window and renewed attention to efficiency, transparency and accountability are reshaping the operating environment for businesses and practitioners.
For those working directly within the cargo clearance chain, however , the real measure of reform is not the creation of institutions or the announcement of new processes. It is whether cargo moves predictably, charges and procedures are transparent, disputes are resolved effectively and businesses can determine the actual cost and requirements of moving goods through Nigerian ports.
Questions around Customs Compliance, Post-Clearance Audit, digitalization , overlapping regulatory mandates , valuation, port charges and service performance remain central to that experience.
At the same time, the lifting of the United States' 12-year Condition of Entry restrictions on vessels calling at Nigerian ports present an important for Nigeria's shipping and trade environment. Converting that development into greater shipping activity and stronger logistics competitiveness will require reforms that are visible not only to domestic operators, but also to the international shipping community.
In this conversation, Abdulazeez Babatunde Mukaila (Our CEO/MD - Mickey Excellency Nigeria Limited) brings the perspective of a customs broker and freight forwarding practitioner, examining what needs to change across regulation, customs administration, digital trade facilitation, port operations and industry advocacy.
The most important protection any shipper expects from NPERA is clarity around charges and performance.
What we need from NPERA, first and foremost, is clarity. Clarity
about transparency, promotion of efficiency in the value chain and
accountability in Nigerian port system.
Transparency means having clarity about who does what and what the
implications of non-performance are. Most importantly, there needs
to be a proper mechanism for the resolution of disputes. This has
been at the lowest ebb, and no one has been responsive or
accountable as a go-to institution when disputes arise.
A major part of the disputes that arise from the port concerns
charges and getting paid for non-performance. So, when I talk
about accountability and clarity, I am talking about charges and
performance.
The most important protection any shipper expects from NPERA is
clarity around charges and performance.
Customs administration globally and freight forwarding are
international and rule based. I commend the present leadership of
the Nigeria Customs Service for trying to match international best
practices.
There is no problem with Nigerian businesses and the average
shipper being accountable from a documentation standpoint. The
onus is on practitioners to advocate, while the average shipper
also needs to understand that international trade is accountable
and rule-based.
Post Clearance Audit gives Customs an opportunity to focus its
personnel and machinery on high risk cargo while allowing
complaint shippers to exit within the required time and remain
accountable after clearance.
What I expect to see is more advocacy and sensitisation by Nigeria
Customs Service. Customs needs to take this message to every nook
and cranny of the country. They need to go into the marketplace,
not just hold meetings in five star hotels.
Nigeria is import dependent, and significant proportion of the
shipping community operates from the markets. If Customs properly
sensitises these market-based shippers on compliance requirements,
it can focus its resources on high-risk cargo while complaint
shippers experience easier and faster clearance.
The Single Window is supposed to create a seamless process where
information is created and shared among the relevant government
agencies. Progress is being made gradually, but manual processes
and duplication are still very much present.
One of the major problems is the rivalry and conflicting mandates
among government regulatory agencies.
For instance, you can have agencies such as the National Agency
for Food and Drug Administration and Control (NAFDAC) and the
Standards Organisation of Nigeria (SON) both regulating products
such as paint, diapers and table salt. There needs to be a clear
separation of boundaries and a unitary command around the
regulation of each product.
There are also instances where the National Environmental
Standards and Regulations Enforcement Agency (NESREA) and other
agencies have regulatory interests around certain controlled
products. These overlapping mandates need to be clearly defined.
When I was the National Secretary of the Association of Nigerian
Licensed Customs Agents (ANLCA), we identified more than 40
products where there were conflicting mandates. There have been
efforts to resolve these issues by getting agencies with
overlapping regulatory responsibilities to share responsibilities,
but the challenges persist.
The Ministry of Trade needs to do more because these overlapping
mandates continue to hamper trade. The Presidential Enabling
Business Environment Council has done what it can, but the problem
has not been completely resolved.
The Customs Service, as the lead agency in the clearance process,
can itself be hampered by these conflicting mandates.
The Single Window needs sufficient authority to bring critical
stakeholders together and identify the borderline regulatory and
oversight arguments around individual products. That is how you
create a truly seamless system.
I am optimistic that Nigeria can get there if the government
identifies the logs in our wheel of progress and unbundles those
bottlenecks.
My biggest concern is the non-performance of critical elements of
the value chain and the absence of transparent protocols.
The World Customs Organization and the World Trade Organization
preach transparency and predictability. How can we get
transparency when charges are hidden?
How can there be rule-based clarity on who pays for what, when the
performance of terminal operators is not clear and there is no
simple, rule-based dispute mechanism when a service has been paid
for but not delivered?
Another major concern is valuation.
There are established principles of Customs valuation, but I do
not think Customs is sufficiently accountable to those principles.
Transaction value appears to have been jettisoned in practice.
You see a Customs officer use a phone to show what is described as
the window or showroom price in China and then use that as a basis
for valuation. That negates the transactional value from the
manufacturer or factory.
Prices found online, including Alibaba prices, can represent
retail or showroom prices and may include additional costs. They
are not necessarily the actual transaction value of the goods
being imported.
With the networking capability available to the Customs Service
under its present leadership, there should be better ways of
determining the actual value of shipments. We need a more finely
tuned strategy based on facts that can establish the true
transaction value.
Accountability should begin with Customs showing the basis on
which a valuation has been arrived at.
Ultimately, the foundation has to be efficient, rule based
international trade practice across the entire value chain.
I am excited about NPERA. Gone are the days when we talked about
the Nigerian Shippers' Council as a toothless bulldog. NPERA has a
broader mandate, and it has the capacity to sue and be sued. There
are also penalties, including provisions for first offences,
subsequent offences, corporate liability and individual liability.
NPERA should focus on pricing first. We need to reduce the cost of
doing business at the Nigerian port and, by extension, the cost of
doing business in Nigeria.
There must be clarity. We need to unbundle the bottlenecks and
have transparency around protocols and processes.
Pricing should be transparent. Nothing should be hidden.
A global practitioner should be able to know the turnaround time,
the cost of berthing a vessel, the number of hours required for
particular services and the cost per hour or per day. Every ship
calling at a Nigerian port should know exactly what to expect.
There should also be no non-state actors involved in critical
processes such as ship boarding and berthing.
NPERA should promote efficiency, transparency, professionalism and
accountability. With the powers now available to it, there is no
excuse for not being able to apportion responsibility and apply
sanctions where necessary.
We need NPERA to hit the ground running and make Nigeria
competitive within the global value chain.
Freight forwarders and customs brokers also have a responsibility.
We need to do more advocacy and ensure that the experience of
practitioners is properly communicated to government and
regulators.
Advocacy is the baseline reason freight forwarders and customs
brokers associate. It gives practitioners an opportunity to expose
their concerns and put their experience forward in the interest of
a better port system and operating environment.
Unfortunately, advocacy has continued to nosedive. We have seen
the emergence of many associations, and some of them appear to
have lost sight of the purpose for which they were established.
The push-through has not benefited the Nigerian port system
enough, and the associations have to take some responsibility for
that.
Many regulations are rolled out without critical stakeholders
being involved at the planning and drafting stage. Freight
forwarders are often brought in at the public hearing stage, when
the substantive work has already been done. That is too late.
Associations need to see themselves as partners in progress and as
critical advocacy platforms that can show government where the
shoe pinches.
But advocacy cannot simply be about raising concerns. It has to
provide practical, fact-based solutions.
Nigeria has the potential to become a leading African trade and
logistics hub, but strong institutions require strong advocacy.
When you compare Nigerian freight forwarding associations with
their counterparts in other countries, there is still a gap in the
capacity and quality of their relationship with government.
Freight forwarders should not be invited simply to increase
numbers at meetings or create a show for the cameras. They should
have a substantive role in policy development.
The Association of Nigerian Licensed Customs Agents (ANLCA), which
is celebrating 72 years, should be able to provide leadership in
this area. We have several associations saying essentially the
same things in different voices.
The Council for the Regulation of Freight Forwarding in Nigeria
(CRFFN) also needs to do more to bring the associations together
and create a stronger common voice for the industry.
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