—– attribute sluggish port processes, high port costs to physical examination of cargo 

—- Customs processes contribute 81.7 to costs of port operations

Eyewitness reporter

The Operators of terminals at the Nigerian ports have slammed the Nigeria Customs Service for reversing the great milestone recorded by the port concession programme of 2006.

The Chairman of the Seaport Terminal Operators Association of Nigeria(STOAN) Princess Vicky Haastrup, who ventilated the feelings of the operators, said the Customs’ incurable passion for 100 percent physical examination of cargo has set back the progress which the ports have made after exiting the chaotic, disorderly and sluggish port services that characterised the pre- concession era.

Princess Haastrup was speaking as a lead speaker at the one-day town hall meeting organised in Lagos yesterday by the League of Maritime Editors to discuss ”Achieving Effective Digitalization Nigeria’s Maritime Industry.”

The STOAN Chairman, who was unsparing in her condemnation of the damage the customs’ archaic cargo clearance procedures have done to the well being of the port industry, said that despite the gains recorded since 2006 with the efforts and investments of the terminal operators and the Nigerian ports Authority ( NPA), the Customs operations have continually been a drag on the efficient service delivery at the Port.

“The efficiency of our ports has improved multiple folds.

“Vessel waiting time has since been eliminated resulting in significant savings for importers and exporters.

” Government now generates revenue in trillions of Naira – through the tax authorities, Customs, NPA and NIMASA – as against the few billions generated before the concession.

“The concession, without a doubt, has increased the competitiveness of our ports and enhanced movement of goods across international borders.

“I am also glad to inform you that all terminal operators in the six seaports across Nigeria today have effectively deployed technology to drive their operations.

“Consignees and their agents do not need to be at the port physically with regards to their transactions with terminal operators.

“The question that may readily come to your mind at this point will be: why then are there so many people visiting the ports daily in connection with their consignments?

“Why is the cost of doing business at the port still high? Well, my answer to this question is Customs processes.

“Despite the tremendous improvements recorded in cargo handling operations and the provision of marine services by NPA, consignees and their agents still face numerous man-made hurdles at the port because cargo clearing processes have remained manual.

“Customs’ cargo clearing systems in Nigeria, using the words of a former CEO of Nigerian Shippers’ Council Mr. Hassan Bello, have remained “archaic”.

Haastrup believed that this outdated mode of goods clearance by the Customs has not only become a breeding method for extortion and corruption, it has also significantly slowed down the process of cargo clearance at the port.

“From the point of 100% physical examination of cargoes, the discretionary powers of Customs officers kick in.

“Negotiations and underhand dealings inevitably happen due to unbridled human contact.

“A study conducted by Akintola Williams Deloitte in 2017 blamed the high cost of doing business at the nation’s seaports on the Nigeria Customs Service and other government agencies.

“The study stated that Customs processes are responsible for not less than 81.7 percent of the charges incurred by consignees.

” It said Shipping Companies are responsible for 13.8 percent of the port cost; Terminal Operators 1.4 percent; Transporters 1.4 percent and Clearing Agents 1.7 percent.” she quoted.

Princess Haastrup maintained that a major reason for the high cost associated with Customs is manual processes.

She however stated that the only solution to this problem is for the customs to embrace automation in its cargo clearance process by reducing the level of manual process to about 10 per cent and engaging in the use of digital technology such as scanners

“The solution to this major obstacle is to drive the clearing process from end-to-end with digital technology.

“The human interface and the discretionary powers of officers should be taken out of the mix.

Haastrup lamented that manual examination of cargo by Customs has assumed an endemic nature which if not checked will continue to denigrate the efforts of the government to attain proficiency in port Operations.

“Manual examination of cargoes has assumed the proportion of an endemic sore point in Nigeria’s Customs administration.

”The Nigeria Customs Service performs 100 percent physical examination on almost all cargoes passing through the ports.

“This is not efficient and it constitutes a huge drawback to port efficiency. The manual inspection by Customs contributes in no small measure to the high dwell time of cargoes at our ports.

” It is also the main reason why importers and agents troop to the port daily. This is in addition to breeding corruption through numerous human contacts.

Haastrup also faulted the present arrangement by the government to procure a “few” scanning machines for customs.

She believed that apart from the fact that the number of the scanners procured is not enough, they should not be entrusted with the customs to manage for fear of sabotage.

She rather advocated for the engagement of the private sector to acquire and manage these scanners for efficiency as was previously done under the scrapped destination Inspection scheme.

“The solution is for the Federal Government to engage the private sector, as was done under the previous Destination Inspection scheme, to acquire high-end scanners for use of the Nigeria Customs Service.

“It is not enough to merely acquire a couple of scanners as the government is doing at present.

” A sufficient number of high-end scanners should be acquired to put a definitive end to manual cargo examination.

“The effective usage and maintenance of the scanners are also critical. Left in the hands of government officials, the scanners may be grounded in no time – as it happened before – and the system will be reset to the manual era.

“The services of risk assessment/management companies should therefore be engaged and retained for the purposes of providing, effectively utilizing, and maintaining the scanners.

” If we are truly desirous of creating efficiency at our ports, the manual examination will have to be reduced to less than 10 percent of the cargoes handled at the port, in line with international best practices.

“Full automation of the clearing process and the deployment of a sufficient number of scanners at the port will invariably cut down the multiple checks of cargoes by Customs and other security agencies” the STOAN Chief noted.