Ember months: Cargothrouput slumps by 40 percent at Nigerian ports
—- Customs laments
The tone of the global trading and shipping environment has been characterised by uncertainty as a result.
The United Nations Conference on Trade and Development (UNCTAD) acknowledged the disruption of regional logistics, halted port operations in Ukraine, the destruction of infrastructure, trade restrictions, increased insurance costs and higher fuel prices as causes of issues within the Black Sea region.
Jan Hoffmann , Head of Trade Logistics branch at UNCTAD, says: “The war in Ukraine impressively shows again how globalised the shipping business is: Shifts in demand in one corner of the world lead to changes in prices and fleet deployment in many other corners of the world.
“What I find most interesting of our findings is that almost half of the increase in global food prices is due to the higher shipping costs.
“And these are higher because goods have to travel longer distances, i.e. we have more ton-miles, but also each ton-mile is now more expansive, because of a shortage of global shipping capacity.”
In 2020, grain prices and shipping costs were already increasing and the Ukraine conflict has accelerated this trend.
According to UNCTAD, between February and May 2022, the price of dry bulk goods transportation had risen by around 60%.
Around 36 countries import over 50% of their wheat from the Russian Federation and Ukraine and global sea exports of grain are expected to decline by 3.8% this year while global shipments of fertiliser decline by 7%.
“Black Sea ports normally account for over 90% of Ukrainian overseas grain shipments, weekly port calls have dropped from 60 to almost zero in Ukraine due to the conflict”
In addition, the high dollar exchange rates to the Naira as well as the high Customs exchange rate for goods clearance have all impacted the purchasing powers of Nigerian importers.
It could be recalled that for yet another time in September, the Customs exchange rate was jerked up from $409 to $422.3, an increment of $13.3.
” Also the recent naira redesigning policy of the government and the coming elections in the country have all created an atmosphere of uncertainty among importers who prefer to stop importation until after the elections when there would be some sort of clarity, and stability in government economic policies,” a source said.
This lull has therefore put pressure on the men and officers of the Nigeria Customs Service to meet their revenue targets amidst sluggish importation.
”We are under pressure to rake in more revenue for the government despite low imports.
“This is because the revenue from the Customer has become a financial mainstay for the government which now relies on Customs to fund some of its recurrent expenditure, especially payment of salaries for workers” a highly placed source declared.
“To cushion the effects which the lull in importation may have on our revenue generation, we have to tighten the noose by plugging all the revenue loopholes to generate maximum revenue”
” Some of the areas where we hitherto overlook by giving the importers and their agents a breathing space to operate have now been tightened up for maximum revenue collection” a customs source declared.
Dog eats dog as Customs officer shoots colleague at border
The spokesman of the Nigeria Customs Service Kano/Jigawa Area Command, SC Nura Saidu, confirmed the incident in a statement.
“Our hearts go out to all those affected by this tragic event, and we extend our deepest empathy to the family and friends of the victim,” he said.
“Our top priority is the well-being and safety of the victim and the larger community at this difficult time.
“We would like to remind everyone that the Service rests utmost importance on responsible firearm handling.
“We will continue to provide updates as the investigation progresses and more information becomes available,” Mr Sa’idu said.
It was gathered that other victims in the vehicle were admitted at Aminu Kano Teaching Hospital, Kano, and are responding to treatment.
Zainab Ahmed, Finance minister, lists achievements as chairman of Customs Board
Exclusive! KLT capacity is underutilised by 80 per cent through low cargo volume—-Bomodi
The Eyewitness reporter
The new Customs Area Comptroller of Kirikiri Lighter Terminal(KLT), Comptroller Timi Bomodi, has identified gross under-utilization of the command as one of its core challenges that his administration is tirelessly working to correct.
Bomodi, who resumed duties in the off-dock facility as its CAC in February 2023, said the terminal has an installed capacity for over 6000 20-footer equivalent units but currently doing less than 10 percent.
Speaking in an exclusive interview with our reporter in his office Wednesday, Bomodi lamented that despite the strategic position of the terminal for ease of cargo evacuation, poor communication of its benefits to importers and their agents has rubbed the facility off the required patronage from would-be customers.
He also identified apathy among the shipping companies to use the terminal despite its inherent advantages of speed and cost-effectiveness, a situation he blamed on the low cargo inflow to the terminal.
” Kirikirio Lighter terminal is mainly an off-dock facility. It doesn’t receive vessels directly, nor does it receive cargo through transfer from other ports. Occasionally, we get transfers by Lighters through one of our bonded warehouses.
”The major challenge we have here is a challenge of traffic, getting more cargo into the terminal.
”The total capacity of the command is over 6000 20-footer equivalent units. But right now, we are not even doing up to 10 percent of that. And when you have facilities that are vast but underutilized, then it is an issue.
”I feel there is poor communication of the strategic importance of the KLT
”A lot of importers and their agents don’t know that it is easier to import through KLT than most other ports.
”It is easier in the sense that after all Customs procedures, which are the same at all Customs Commands, it is easier for trucks to come into the command and take the goods out, which is not so with most ports in Lagos due to the chaotic transport situation and the queueing system.
”You have an electronic call-up system in the other two major ports and that creates a lot of time lag before your trucks come in and you take your goods out. We don’t have those challenges here and because of that, we believe importers will be better served in a place like KLT because of the short time it takes to get your goods out” disclosed Bomodi.
He lamented that despite these inherent advantages, the command is experiencing a low volume of cargo. This according to him leads to underutilization of the terminal and underperformance of the officers whom he said are well-trained, equipped and properly motivated.
”The officers we have here are just like other officers we have in other commands: well-trained, well equipped and highly motivated to work but grossly underutilized. So as far as Customs procedure goes, we are just like any other conventional port.
”The only thing we don’t have here is a scanning machine. Everything is done manually, physical examination. But that is not an impediment to the facilitation of trade because as I said, we have the space, equipment and well-motivated officers to make the examination process fast and seamless.”, the CAC claimed.
He also claimed that the command has a well robust export terminal which is now operational and connected to the Customs server.
”We also have an advantage for exports. As I mentioned earlier, it is easier for people to come into the terminal and take out their cargo because, in this command, traffic is not so bad on this axis compared to others. So if somebody wants to export his goods through the command, it is a lot easier to do so.
”Right now, we have an export terminal called Tesic that is now operational and connected to the Customs server. This export terminal has the space, they have the capacity to process large volumes of exports through the command.
So there are so many advantages that you get from using this place and we want a lot of people to know about it so that we can have an increase in traffic.
Bomodi however said it is not in his place as a Customs officer to woo importers to the command as his main job is to facilitate customs processes.
”It is not in my place to woo anybody. As a Customs officer, my primary responsibility is to attend to the business of Customs in this Command.
”We only highlight the challenges such as the underutilization of the critical assets in the command because we know we can do a lot more than we are presently doing.
”And that the importers and their agents need to be aware of the advantage of doing business in the command and that they need to know that they will save cost and time by using the command.
”The longer it takes to take goods out of the port, the more expensive it is because of the charges such delays will accrue on the goods from the shipping companies and terminal operators”
Bomodi thumbed his chest that it takes a maximum of 48 hours to exit goods outside the terminal after all customs processes have been completed without any issue.
”In KLT, the significant amount of such extra costs can be eliminated because it only takes a maximum of 48 hours to clear your goods from the command if there are no issues.
He, however, believed that the decision to move cargo from one point to the other is not necessarily that of the command, but that of shipping companies.
”The shipping companies, by virtue of their work processes, value time and want a quick turnaround of the vessels and return of their containers. So all these factors will be taken into consideration before they ship cargo into any port.
”Then you wonder why the shipping companies are not taking maximum advantage of a place like KLT because ordinarily, they should. It makes more sense for them to do so.
”Why are they not making use of the command? Well, that is the question you should ask them because I don’t know.
”We have quite a few shipping companies servicing this place such as MSC, Maesrsk and others and you know a good number of them come in by transire and they do this in trickles. If we can get them to do a lot more, then everybody will benefit from it.”
”Shipping companies make their money from the hiring of their boxes, containers are like buildings. They make more money from the high turnover of how the containers are rented out to more people rather than tying them for a longer period with few customers.
”The business process of these shipping companies encourages the use of such places like KLT but I don’t know why they are not using it and that is what you have to ask them”Bomodi bemoaned.
He however acknowledged the negative impact of the low traffic volume on the revenue profile of the command
”Of course, it does. The fewer the cargo, the less revenue we are likely to generate. But this does not mean we are not working tirelessly to block all revenue loopholes.
”Our poor revenue generation is a reflection of the low level of cargo at the command and that is what we have to deal with.
Bomodi disclosed that the command has a revenue target of N60 billion for the year 2023 but was hopeful of meeting the projection despite the daunting challenges confronting the KLT.
”We do believe that as the traffic improves, so also our revenue will scale up.
”Our revenue target for this year is about a billion. We can only be optimistic about meeting the target in the face of the daunting challenges I have just enumerated.
”We can’t afford not to be optimistic. We do hope and pray that things will change for the better because the year so far has been very turbulent in terms of trade, especially between January to this period, a lot of things have taken place which have affected cargo volume in particular and the economy in general and our operations cannot be separated from these economic challenges in the country.
”Hopefully, by the time the new administration is sworn in and there is stability in the system, this will likely lead to an upsurge in the economic activities in the county which will in turn positively affect our operations, Bomodi enthused.
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