Prince Mike Okorie is the President of All Ports Unified Freight Forwarding Practitioners Association. In this interview, he spoke on the border closure, smuggling, among other issues and gave his group’s perspective on the way forward in the light of recent economic developments. Excerpts:
By Eguono Odjegba
AS a group with members drawn from both the trading community and freight forwarding industry, what is your view about recent developments in the maritime industry, especially the continued closure of the land borders.
The problem with our government is one; they don’t take stakeholders inputs and views before coming up with policies. It is only when such policies boomerang that government thinks of engaging stakeholders and looking for who to blame. Look at our land borders that have been shut down for more than two months, there is no valid basis for this action. Trans-border trade is tripartite in nature and it is the height of impunity for government to take action affecting the national economy without dialogue.
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If they are talking of security, it is not done by locking down the economy, security is intelligence-driven. Because this particular border closure was not well articulated, Abuja has been struggling to justify the action with irrelevant seizures since they have failed to produce results that can validate their alarm of security threats. Along the line too, the government has been trying to change the song from security threats to economic sabotage. The military are trained for defence and security threats, not for economic policing. Our military must be deployed properly, credibly and professionally, their operations are supposed to create immediate relief to citizens and boost national confidence.
It is sad to say soldiers have been reduced to chasing after bags of rice and tins of tomatoes along border communities and bushes. If the customs boss is saying his men are no longer capable of carrying out this duty, he has by his actions admitted failure, he should resign. But don’t forget his background as a soldier, isn’t it possible he is leveraging on areas he can derive the needed capacity to deliver on his functions
The economy of Nigeria is not a military affair, the customs service is a sub-economic agency trained for professional anti-economic smuggling. Nigerians expect that the customs boss should learn fast and keep within lawful ambit. Before his appointment customs have been partnering with the military, without the military assuming the duty of the customs.
We are talking about land border closure. Yes border closure, because the customs leadership is saying local rice policy is being thwarted by trans-border criminalities. I worry when our government makes us believe that our borders only exist for smuggling. This notion is wrong. Duties and taxes are paid for imports and exports on trans-border trade. We are the people feeding most of the sub-regional neighbouring states. It is noodles, biscuits, beverages produced here that are consumed in Ghana, Cote d’Ivoire, Benin, Togo, Burkina Faso, etc. Some of the trucks presently stranded at Seme and Idiroko borders were loaded at factory premises in Ikeja, Oshodi, Agbara, Ojota and others at Idumota market. Nigerians work in these factories, 90 per cent of the traders at Idumota are Nigerians, now the factories, their owners and workers are endangered.
Is there no alternative transportation route to engage in the export of your goods?
Yes, by air and water. Don’t forget that most of the items produced in Nigeria and demanded across the west coast are ETLS (ECOWAS Trade Liberalisation Scheme) goods. Freight by air is expensive and not for our kind of cargo, apart from the fact that our cargo air services is still crawling. We have no trans-border rail system. Coastal shipping services have since become unpopular, because the services are no longer just there. Go to any of the shipping lines and ask for vessels for West Africa supply, they will tell you they don’t have ships. Whoever tells you to wait; you will wait endlessly, so we are stuck with trucking system by road along land borders.
We are the ones feeding the entire sub-region; the truth is that more goes out from Nigeria compared to what comes in. The entire sub-region depends on Ladipo auto spare parts market in Lagos for their supplies. Why punish traders when customs and all security agencies operating at the border are there to do their job. From Lagos to Gbetorome to Krake, the number of customs and security checkpoints is alarming.
If there are compromises and lapses the customs boss should look inward and blame himself. From Krake to Aflao in Ghana or Lakoji, there are only three security checkpoints, so I worry when our authorities talk about land border trade as though everything that comes from the land border is smuggled. Lever Brothers, Cadbury, Nestle, Dangote, Unilever, Flour Mills all depends on land borders to supply their products across the west and central African coast.
So are you saying if the government has reason to close the land borders they shouldn’t do so?
We do not have the power to decide what government should not do; all I am saying is that closure of land borders is a big deal. Don’t forget that in most cases, land borders are international route, for example the Seme border otherwise known as Lagos-Abidjan Corridor. If government finds reasons to want to close the borders, you must carry contagious states and critical stakeholders along. Imagine Mexico that is always accused of being a drug country and which President Donald Trump threatened to build border wall, did it materialize. No country can go it alone; you can’t do without your neighbour. Benin is a poor neighbouring country that survives on Nigeria. God made it so; it is not by our power. He allowed them to exist beside us and yet made us prosperous.
Government is concerned about growing the capacity of local rice producers, concerned that we have no reason to continue to import rice.
If the closure of the borders is about blocking imported rice, tomatoes and frozen chicken and turkeys, because I know you will come to that, that shouldn’t warrant shutting down the entire trans-border economy. I have said that Nigeria is central to the survival of the sub-region in terms of commerce and economy and this commerce is supported by the trans-border land movement of export, import and ETLS goods. People from Abidjan, Accra, Niamey, Mombasa, Lome, Bamako, etc. all come to buy industrial goods, agricultural items, food and other supplies from Aba, Idumota, Aspanda, Orile International market, Dugbe, Sabon Gari markets and so on. The Lagos-Abidjan Corridor is the biggest regional commercial chain, both under ECOWAS and international trade. Can the customs provide correct statistics of available rice in the country vis-a-viz demand, can this government tell us the quantity of smuggled rice entering into this country, and what actual available figure is? Policy actions are supposed to consist of these critical figures which are based on short, medium, long term, and supposed to help with planning.
Now we are approaching Christmas, because of this development, a bag of foreign rice has gone up to about N30, 000 while the local brands are about N25, 000 per bag. Where does this put the masses and minimum wage earners? Of course, our leaders, policymakers and those at the helm of implementing these policies earn millions of naira monthly; in most cases, they eat free food, take free drinks and earn fabulous allowances. They isolate themselves from ordinary people and from reality. Local rice programme is long tenor policy and it is a work-in-progress action document. Why must we rush it?
Now because of narrow perception and the desire to rush, the policy critical frameworks like the Anchor Borrower’s Scheme has been reduced to petty and regional politics such that the policy thrust has become imprisoned in the same circle of individualism, the same mistake the Jonathan administration made. So when government and customs talk about local rice production policy content, I think it is mere propaganda. Local capacity growth will on its own deal with rice smuggling because smuggling is an economic factor. Until government treat foreign rice smuggling economically, we may continue to waste energy in the wrong pursuit and even delay what should otherwise be a straight race.
Are you saying smuggling of rice and this border closure will not seriously impact on the rice policy content?
How many full trailers of rice has customs arrested in the past three years at the land borders? The fund wasted on manpower and operational logistics chasing rice smugglers should go to support local rice farmers and the rice value chain. One shipload of rice cannot be smuggled from Benin to Nigeria in six months. We are just overheating the system and making needless enmity. We should concentrate on increasing our local rice production capacity. Building rice capacity is not like establishing a federal college of rice at Lokoja by acquiring lands, clearing, building structures, employing workers and beginning school work all under a year. Rice economic policy matter requires meticulous planning and implementation over a certain period of time, it is not a party slogan or four-year thing. It is not like Lagos-Ibadan road rehabilitation projects that can have such a time frame, although we all know it has been in the works since 1999.
It is not enough for one state governor somewhere to say he has cleared 2000 hectares of land and declare his state can produce enough rice to feed the entire nation…that is the funny politics presently confronting us. They talk about Kebbi rice, Lake rice, Coscharis rice, Abakaliki and so on. Where are the rice and how much? Production and rice availability depends on many factors not just clearing land and planting. You can plant 5000 hectares of rice and get hit by pests, your harvest projection runs into trouble. Rice availability and local capacity is more than party slogan and sentiment. Until your projected rice yield and demand forecast is certain, banning rice importation shouldn’t be an option.
But government is saying that smuggling of rice from Cotonou is not helping our planning either. I asked earlier if you think closing the border would not achieve much in the current effort at stabilizing our rice policy direction
It is not me that is saying so, it is evidence on ground. We are not in a republic of unknown soldiers; this government rode to power shouting anti-corruption and progress. Has it not been able to identify corrupt areas in the system? Which of the corrupt rice smuggling barons has been put in jail?
Political party machines
Rice smuggling goes beyond the border, in fact, rice smuggling through the land borders is a child’s play compared to its smuggling through seaports. Imports whether rice or any other thing through any point of entry in which duty is lost amount to smuggling. You and I know that the chief culprits have all melted into political party machines.
Is it not an irony that customs that have transformed into a ministry of rice and closed the borders have simply admitted its lack of capability to collect revenues due from trans-border trades? While this administration finds it convenient to blame Benin for huge import market destined for Nigeria, nothing is being done to address our expensive tax and tariff system. The customs like to accuse importers and agents of lacking integrity in import declaration, to me that is neither here nor there, it is a trick devised to rob Peter to pay Paul. Initially, we use to load 12tons to 15tons trucks direct from Cotonou port to Iddo. We run entry and pay duty at the border, but this same administration stopped it and said foods should come in articulated trucks.
There is what is called tracking system in trans-border trade, whether import, export or ETLS, along with weighbridges that determines the number of goods in a truck. There is also what is called cargo scanners which scan goods at entry points and help in the seamless detection of dangerous, questionable and security items. Under this customs administration, the tracking and scanning system collapsed. Now the person whose responsibility it is to make these things work is turning around to say I am the problem.
Clearing agents don’t mind the borders; we are just a third party in the clearing process. If I under-declare it is customs duty to issue me Demand Notice, DN, whose fault is it when that is not done?
One customs officer releases a consignment at Seme border or Tin Can Island Port, another customs officer intercepts the consignment at Ibadan or Ore. Yet the customs area controller, the releasing, valuation, CIU, examination officers at the point of initial release are keeping their jobs. If you ask, Abuja will say errant officers are been punished, how. How many has the customs boss prosecuted and jailed in comparison to the volume of infractions? The customs issues PAAR and afterwards raise DN on the same goods Abuja have given you value to pay. You pay and as soon as you leave the port, you see Federal Operations Unit, Strike Force, Monitoring Team on the road, carrying out own checks and clearance processes, isn’t this sign of systems failure?
It wasn’t only rice that was banned from coming in through the land borders, vehicles too were banned
And who is losing, who is struggling to keep pace with smugglers of vehicles, is it not the government? Has smuggling of vehicles stopped? Have you sat down to calculate what it costs government every year to sustain the struggle against rice and vehicle smuggling? You see if we are sincere with our operational appraisal, it is easy to know that our situation is like the saying ‘penny wise, pound foolish.’ Nigeria is losing greatly because from reports, Nigeria controls 70% of trade in the sub-region. If you go to Idumota market waterside, you’ll see different trucks loading goods to take outside the country, not to talk of other trucks which loaded direct at factory premises destined for supply to the West Coast. Our problem is poor leadership. Do you know that when the customs boss addressed the Senate Committee and bamboozled with half-truths, they couldn’t ask questions? Lawmakers couldn’t ask how customs made N1trillion and what the consequences were on the economy. They just listened, nodded and looked away. The quality of our leaders is so poor. With what is happening, Nigeria may be losing regional trade power, neighbouring states may start thinking of alternatives once they start losing confidence in us.
This border closure has also celebrated the stoppage of smuggled petroleum products to Benin and other neighbouring countries
What impact does smuggling of fuel or otherwise has on the masses. Are we not buying fuel at N145 per litre, has the stoppage of its smuggling reduced the pump price to raise citizens savings? Has it improved our crude price in the international market? We delight so much in propaganda in this country. Nigeria is the 6th largest producer of crude in the world. The government projected N462billion in the 2020 budget to pay for fuel subsidy, 419 subsidy. If that money is channelled into agriculture, with time we will be able to meet our target in rice production capacity. How much did agriculture get in the 2020 budget, but about N99billion was budgeted for generator, diesel and generator services. So, who is fooling who?