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Power more than smuggling, cripples local industries, Dikko

By Ifeyinwa Obi
If the Comptroller-General of Nigeria Customs Service, NCS, Alhaji ABUDULLAHI Inde Dikko, was not in the Customs, perhaps he would have fitted well in the SSS or other security agencies. He is calm, calculative and has this gaze at a visitor to his expanse office, as if he wants to get your mission off you without telling.

Diko

A perfect gentleman by his looks, Dikko has continued to redifine, NCS  since his appointment in the 3rd quarter of last year.  A very intelligent officer, Dikko seems not to be caught unawares on any issue that bothers on the service.

No wonder he is a reporter’s delight, judging by the number of maritime reporters seeking to engage him on daily basis.
As the head of the second largest revenue earner of the Federal Government , after oil, he unfolded a six-point agenda aimed at keeping his Customs on top of its business.  Among the  agenda, is the  consolidation of the current E-Customs through ASYCUDA for international best practices

and ensuring welfare package for officials.

Although, maximum welfare package, may not have been attained as some critiques may argue, but Dikko seems to have  restored a new spirit of hard work and a zeal to earn more revenue for the coffers of the nation. He said this was possible because he worked on raising the morale of the Customs officers.
It was Dikko who recently fought and won the battle of raising the take home of the Customs workers.

This is even as he paid the 13th month salary to all officers last December as an incentive for improved revenue performance in 2009.

Amid tight schedule our reporter, Ifeyinwa Obi cornered him in his office in Abuja last week, drilled him and was able to get most of the information he has not revealed to any journalist before.
Enjoy this interview with Dikko, who was recently elected, Vice Chairman World Customs Organisation.
Excerpts:

The Customs and Excise Management Act (CEMA) has been criticised recently by stakeholders as lacking relevance in modern port operations and trade facilitation. Does the service have plans to amend the legal framework to suit current business realities?

There is no doubt that International Trade and Customs operations have witnessed tremendous changes since the 1950s when CEMA was enacted.

Developments in Technology have impacted profoundly the conduct of International trade. Some attempts have been made in the past to amend the CEMA in 1990 and 2004, but I agree with you that we have not seen changes that adequately bring up the provisions in line with the frenetic changes the business of Customs Clearance has undergone.

Now we have entered the era of electronic declaration, payment and Processing. We shall require laws that are robust enough to cover emerging trends like cyber Crime, hacking and all that.

We are already thinking ahead, working with the Ministry of Justice, with support from the Presidential Committee on Customs Reforms and USAID to amend the CEMA. A lot of progress has been made in the direction, and I am grateful for all the parties involved in the process.

Waiver and concessions are recurring words in business discussions among business communities. Can you explain what categories of imported goods are granted waivers?

Both terms represent some kind of relief from duty Payment or exemptions from specific fiscal policy decisions. In operation, it involves suspending duty payment in the short run for some other long_term objectives.

If an investor is building a factory for instance, the customs duty and taxes on the imported machineries can be waived, on the belief that the finished factory will create jobs and produce other multiplier effects in the long run. Waivers are usually import specific regarding volume, period, beneficiary etc. Concession may be broader and applying to more beneficiaries and usually enunciated in fiscal policy statements for a given year.

Apart from concessions already provided for in the Tariff, all approvals for Duty Waivers and concessions are granted by Mr. President, on recommendation of the Honourable Minister of Finance. Approvals so granted are usually communicated to the Customs in writing.

There are newspaper reports that Power Holding Company Nigeria Limited (PHCN) Equipment are abandoned in the ports with threats auction hanging on them. Can you react to this?

The Ports are designed to be used as Transit Point between the place of manufacture or Import and that of final use. They are not supposed to be used as storage facilities. If you recall the ugly experience we had in 2008, when the rate of deliveries from our ports could not match that of discharge from vessels. The subsequent congestion paralyzed activities in our Ports.

The Customs and Excise management Act (CEMA) makes adequate provision for dwell time of cargoes in the port. CEMA also stipulates clearly the procedure to be used in disposing cargoes that over_stay the statutory period allowable. One of the reasons for which our ports were concessioned to private operators is to enhance their efficiency.

Periodically, we therefore need to make space for serious importers by disposing the cargoes of unserious ones. It is unfortunate that importation for Government projects form a major chunk of the cargoes abandoned in the ports. Some of these were made by contractors on behalf of Government Agencies, like the case of the PHCN Equipment.

When equipments for sensitive project like Power Generation are abandoned, you can imagine the effect on the project itself. Contractors found culpable in such messy importation should be brought to book and prosecuted as saboteurs. As a policy, we don’t auction goods imported by Government Agencies. In this case, we have made contact with PHCN, and I can assure you that those stuffs will be taken out of the Ports for the execution of the Power projects.

Information technology has become the bed rock of modern business to the extent that International Trade can be conducted online. Customs ASYCUDA System seems to be your answer to this phenomenon. How far has it helped matters?

We are tapping from the opportunities offered by development in Information Technology. Greater percentage of Customs Clearance related activities are now done on_line more than ever before. Manifests are submitted electronically.

Declaration by importers can be done in their offices. Those without the facility for on_line declaration can do so in licenced DTI cafes, situated around our ports. All these were provided as platforms, preceding the take_off of the up front payment system.

We had a successful pilot_run at the Nnamdi Azikiwe International Airport in Abuja. The Roll_out in Lagos Ports have been smooth. The Eastern Ports will come on board before the end of April. We have scheduled sensitization seminars for Port Harcourt, Calabar and Warri to carry along our stakeholders in these port areas. Training of officers and other users will follow, before the re_configuration of our system and ultimately a full roll-out.

There were past attempts by the service to link all the port communities to a common server _ Shipping Lines, Terminals, Banks, Freight Forwarders. To what extent have you achieved this?

That is the ultimate we are pushing for with ASYCUDA and I will say that we are already on the home stretch. The whole idea is to deploy a system robust enough to accommodate all stakeholders. All these stakeholders -shipping lines, terminals operators, duty collecting banks, Customs Agents _ are all in the system. But we need more than that.

Other Government Agencies need to be connected to our system. For instance, if NAFDAC is inter connected, an Importer routed Green on Customs Asycuda will not be subjected to physical checks by NAFDAC, because we would have used the same parameter in channeling the import to Green.

The level of integrity in Customs seems to be a key factor in the relationship between the service and the private sector. What other steps have you taken to restore the confidence of the organized private sector in Customs considering that most industries blame their failures on Customs inability to check the activities of smuggling?
Smuggling is a big problem, affecting our economy.

It is not only the local industries that bear the brunt of smuggling. Government Revenue dwindles as well, with the attendant drop in resources available for the three (3) tiers of Government to implement developmental programmes. However, I disagree that smuggling is the decisive factor responsible for the collapse of our industries. We must appreciate that while we struggle to check smuggling, our industries may still lose their competitiveness if challenges in the power sector are not adequately faced. Technologies in the production lines must be improved and modernized.

The debate on whether we still retain competitive advantage in local production of raw materials like cotton is still on_going. While I am not passing the buck, I am of the opinion that the problems of our industries require an holistic approach, involving all stakeholders. This is an approach we believe in, and it is the recommended theme which the World Customs Organization (WCO) encouraged its members to pursue by declaring 2010 the year of Customs_Business partnership. It will be partnership based on mutual trust.

Part of reasons why corruption is in the rise is that workers morales are not boosted. Can you stoutly claim that your officers are happy doing their job?

Of course, the morales of our officers are on the high now and it can only go higher. For years, we have been battling to improve the take_home pay.

Just about a week ago, God answered our prayers for a 100% pay rise. Last year, we paid the 13th month salary for all officers, as an incentive for improved revenue performance in 2009.

We are acquiring more residential houses for officers in Abuja and Lagos. We are boosting their skill through computer literacy training, and putting in place a Laptop acquisition programme, with the service picking half the bill of the Laptops. When we do all these, we have the right to demand a situation of zero_tolerance to corruption.

Some officers, particularly in Lagos Area have been known to sleep in their offices. Several reforms in the service seems to ignore this essential human need. Do you plan to provide accommodation for your officers’ in high density cities like Lagos, Port Harcourt and Abuja?Provision of adequate accommodation is the focus of our welfare programme.

I have worked in some of these major towns, and I know what officers go through to get decent accommodation. Intervention of successive Customs Managements has been a function of the limited resource available to them. We are taking the issue head on; and we are starting from Lagos and Abuja.

We just got a Federal Executive Council approval for our proposal to acquire 165 housing units in Kuje. We are developing a site in Kado for Senior Staff barracks. We are going to engage technical consultants to redevelop our barracks in Okokomaiko along Lagos_Badagry Road to a decent place, habitable for our officers. We have also commenced the renovation of old barracks in Karu, Gowon Estate in Lagos and Kano.

How is the Nigeria Customs Service funded and do you think the current budgetary provision is adequate?
The service is funded though what we get from the seven percent of our collections into the Federation Account. Of course, it is grossly inadequate because almost 80% of this is used as monthly overhead costs. This is the central message I have been telling officers, that we need to generate more, so that we can have more to spend. The increase in our salaries can only be sustained if we keep the present momentum.

Beyond this however, we are making informed presentations to the National Assembly to reconsider a percentage of FOB value of imports as alternative funding formula. This is how the service providers are funded. What is good for them is only fair for us too.The relationship between the Customs and her Service Providers is hardly discussed.

Are you satisfied with their services? How prepared are your men to take over their operation considering that their contract is on build operate and transfer basis?

Service providers are Government appointed contractors for implementation of the Destination Inspection Scheme. We must work together with them, under_study them and get ourselves equipped for eventual take_over of the project. We have seen_out half the contract period already, but the service has not gotten enough form the service providers.

I consider the training programme inadequate, in terms of the quality of the programme, and the number of officers trained. By now, they ought to have deployed fixed scanners in about four port locations. Only one can be said to be near_ready.

This could be a ploy to request an extension of the programme, bearing in mind that it takes almost twenty_four months to install a fixed scanner. We shall monitor them closely and will not hesitate to make appropriate reports and recommendations to Government, if we suspect sabotage of hand_over of the project on their part.

Your officers are applauding the recent announcement of increase in their take home pay but industry watchers say it is still inadequate considering their contribution to national development.

When are you going to pay the new salary and should we expect further increase in salary for them to be at per with other revenue yielding agencies;

I agree with you about the inadequacy, if we consider the contributions of the officers and even the sacrifice they make to generate the revenue.

However, the pay rise we accomplished is unprecedented, and I believe this will fire them up for better performance. We are starting payment of the new salaries this month and we hope we shall be able to pay the 2010 arrears with first payment. I am optimistic that further increase can be favorably considered if we generate enough to cover the increase. The ball is in our court, and I have made this clear to the officers.

Nigerians however would want to know what the country stand to gain from Hong Kong’s collaboration?
The Customs Administration in Nigeria and Hong_Kong are active members of the World Customs Organization (WCO), which encourages technical cooperation between its members. The visit afforded us the opportunity to share experience with our colleagues, and to learn global best practice in Customs Management and Administration.

The Port in Hong Kong is a big hub in South_East Asia, and in terms of volume, handles 47,000 containers daily, the 3rd biggest in the world. The Airport handles a daily average of 284 flights and over 300,000 passengers.

We certainly had lessons to learn from their experience, from their robust Risk Management System, Marine Patrol and Joint Border Co_location Concept. They expressed readiness to assist our capacity building programme. We shall also be opening discussions with them on acquisition of patrol Boats and training of Marine Officers.


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