August 1, 2021

The Customs’ trillion Naira revenue question

The Customs’ trillion Naira revenue question

THE Nigerian Customs Service, NCS, has made a landmark achievement, reporting a sum of N1.003 trillion in the first half of the year 2021, H1’21.  Going by regular trend in recent years, the figure will significantly surpass N2 trillion mark by year end. 

Already the H1’21 is about 63 percent of the full year 2020. It is almost 60 percent of the N1.7 trillion target set for the full year, meaning the target would likely be surpassed by as much as 20 percent.

The Customs revenue had been on astronomical increase year-on-year. In the 2020 full year, the Service had recorded N1.6 trillion, far above the previous year’s figure of N1.3 trillion and beyond the target of N1.4 trillion set for it by the Federal Government.

While applauding the Service for the achievements, we note the concerns coming from several stakeholders in the Nigerian trade and exercise sector. That Customs, a central authority in the sector, could report such robust financial results amid pains and penury across the sector gives much concern to discerning observers.

We join them to wonder how the revenue growth is recorded in an economy under recession for some of the periods and in sluggish growth for most of the periods, compounded by the advent of COVID-19. 

Even the more efficient private sector corporates have not recorded such growths given the adverse macroeconomic circumstances, both in the domestic and global space.

The Customs itself recognises this contradiction with its spokesman, Joseph Attah, saying: “Last year’s revenue was also in excess of the N1.342 trillion it generated in 2019, despite the COVID-19 pandemic’s effects on the economy.”

The figures are not unacceptable because they are stupendous but when placed side by side with its role as a trade facilitator, the Customs revenue may have amounted to robbing Peter to pay Paul.

The former Executive Secretary of the Nigerian Shippers Council, (a major government agency in the trade sector), Hassan Bello, recently expressed misgivings over the Customs revenue figures. He couldn’t agree that such figures should be acclaimed as evidence of a good job when the sector was going through traumatic experience in the hands of the Customs services where clearing of goods is the worst world over.

All operators’ groups in the freight and logistics segment of the sector have lampooned the Customs over what they see as anti-trade operations, including 100 percent container examination.

We acknowledge the impact of the Customs’ on-going reforms that exploits the potentials of technology through robust automation of the processes and procedures, but we wonder why the impact is only seen in revenue and not in service delivery.

While we support improved revenue from Customs to the national treasury, we expect improvement in its core mandate of trade facilitation with specific emphasis on goods clearing turn-around time.