New Telegraph

Blame games over N500bn expired products at Ports

The Lagos State Consumer Protection Agency(LASCOPA) recently sealed a supermarket in Lagos, and warned residents to be wary of what they buy these Christmas period, warning that the market has been flooded with expired products. The General Manager of LASCOPA, Afolabi Solebo, who made the disclosure in a statement, stated that the move was part of the agency’s efforts at clamping down on expired products in the state. He urged residents to always check the information contained on the labels of items about to be purchased and report stores where expired products were sold. This came as the Nigeria Customs Service(NCS) in defence of the recent outcry over its reported sell of hundreds of seized vehicles as scraps, disclosed that the vehicles were overtime cargoes that have stayed too long in the ports and no longer worthy of use on Nigerian roads. The National Public Relations Officer of the Service, Deputy Comptroller Timi Bomodi, who stated this, noted that; “All these seizures that were made as a result of long stay at the port among other reasons, are prescribed ways of disposing of them.” PAUL OGBUOKIRI reports

 

Abandonment of containers

Recently, it was disclosed that no fewer than 7,000 containers at the Lagos ports have been classified as over-time cargo and accumulating huge demurrage. Also, new containerized cargo arriving at the port is estimated at about 2,000 in the past one month.

They are expected to face the same challenges that have forced earlier ones into abandonment. Key challenges, according to the Importers and Customs Brokers range from use of manual cargo inspection by the Nigerian Customs Service (NCS) to rising cost of clearing associated with corruption and exchange rate volatility. According to the Acting President of Association of Nigerian Licensed Customs Agents (ANLCA) Dr. Kayode Farinto, the market value of abandoned cargoes at the port is about N500 billion.

He said that cargoes have accumulated over N60 billion demurrage and associated costs this year alone, and the amount is rising daily. He said that while terminal operators have slammed about N22.5 billion as storage charges for the cargoes in their spaces in the first nine months of this year, shipping companies’ demurrage charges are put at N37.8billion during the same period.

A breakdown of the above figure showed that shipping firms collect approximately N20, 000 per day for a container while the same container attracts a fee of N12, 000 per day by terminal operators. Shipping industry operators alleged despite the deployment of the scanners at the ports, Customs insist on not using them to inspect the cargoes, a situation which leads to long delays in the clearing process and subsequently forcing cargoes to accumulate high demurrage and storage costs.

Consequently, the importers, according to Dr Farinto, are forced to abandon the cargo, adding that as at June this year, over N500 billion worth of cargoes have been affected by this situation. The clearing process is also said to be tainted with corruption as freight forwarders claim they are often pressured to part with money to enable fast-track inspection.

Confirming the development, President of the National Council of Managing Directors of Licensed Customs Agents (NCMDLA), Mr. Lucky Amiwero, said that terminal operators are just having a field day making money from the Nigerian port industry. Port industry stakeholders have specifically attributed the crisis to manual examination of cargoes by the Nigerian Customs Service (NCS), despite the availability of digital scanning machines.

Nigeria is said to be one of the few countries    in the world still using manual examination for cargo clearance, making the country’s ports uncompetitive against those of neighbouring countries. It would be recalled that the Customs procured about four scanning machines over a year ago at a total cost of about $160 million.

However, the installation and utilization of the machines have been surrounded by controversies till today. While the NCS attributes the delay to the training time for its personnel that will operate the scanners as well as other reasons, some stakeholders are of the opinion that the Service is deliberately refusing to deploy the machines because the 100 oer cent Physical Examination creates opportunity for Customs operatives to seek and collect gratifications for cargo clearance.

 

Consequently, the Service still relies on manual examination of cargoes; a process which the stakeholders say is causing the delays in clearing cargoes while spaces at shipping terminals are being taken over by consignment their owners could not clear because of stumbling blocks in the system.

Forex scarcity hampers clearing, cause abandonment of cargoes by importers In a similar vein, the General Secretary of the Association of Concerned Freight Forwarders and Transporters, Jonathan Ubaka, disclosed that there over 40 per cent abandoned vehicles at the ports over problem scarcity foreign exchange. He said: “The situation we have now is very critical when it comes to business. Doing business now in Nigeria is a very difficult thing due to concerns around foreign exchange, imports, duties and all that.”

He said that it is an issue that needs to be addressed. “I am requesting that the Federal Government increase the amount for Form Q from $20,000 to at least $50,000 and also reduce the official rate to enable things to go well. For you to source forex, it takes a lot of time,” Ubaka said. Sunday Telegraph learnt that there are many  categories of trapped containers including export goods with many agro-perishables already rotten in the various ports.

There are also imported cargoes that have been abandoned as result of being trapped and eventually caught up by the variations in exchange rate and tariffs applied by the Customs. One of the importers told Sunday Telegraph that, “as the demurrage continues to mount daily, the congestion is getting worse and shipping companies and terminal operators are not interested in issues leading to delays and abandonment of cargoes at the ports.

The cargoes are in their facilities and you have to pay for it.” Port operators said whenever these goods that have overstayed their period in the ports manage to make their way out, the importers or those who bought at auction from the Customs push it into the market, even though the goods would have expired by that time.

But a staff of one of the leading terminal operators disclosed that, “this does not help the terminal operators because terminal operators trade their spaces. The container terminal yard already has uncleared cargoes eating up the spaces. So, when fresh containers arrive, we always have issues with space. Where to keep newer cargoes is always a dilemma because the old ones that arrived earlier are yet to be cleared due to the slow nature of Customs examination.”

He further lamented: “When the scanners arrived last year September, we were happy because to us, that should signal the end of physical examination of cargoes at the ports.

“Examining cargoes physically is a very slow process. Imagine the amount of containers that arrive at our ports every day; how many can Customs officers examine physically on a daily basis? Customs officers are human beings and have their limits.

“If Customs does not examine these containers, they cannot leave the ports. But the form of examination being used is sluggish. Thus, the number of uncleared containers cluttering the ports keeps rising.

It’s a dilemma that we find ourselves in.”

Customs explains

The Customs seems to be in agreement with the need to put the scanners into active use immediately. Speaking, the immediate past Public Relations Officer of Onne Customs Command, Ifeoma Onuegbo, had earlier explained that the one scanner left for the Command has since been installed, but Customs agents in the command said the scanner has not been functioning properly contrary to the position of Onuegbo, who explained that the only problem was that the lone scanner is not enough to service the volume of cargo passing through the Command.

At the Apapa Customs Command, the equipment has not been put to use one year after delivery and the Command headed by Comptroller Yusuf Malanta blamed the development on ongoing works on the Lagos-Ibadan standard gauge railway track. However, Abubakar Usman, Public Relations Officer of Apapa Area 1 Command disclosed that the modalities are complete for commencement of operation of the scanners.

He said they are waiting for the scanners to be commissioned. He also said it is not true that the Service is deliberately delaying the deployment of the scanners for personal gains. He noted that what is referred to as delay is preparation time. But recall that the Comptroller-General of Customs, Col. Hameed Ali (rtd), had said in the past that the Service will continue with 100 per cent examination despite availability of scanners because importers are not sincere in their declaration.

Stakeholders want scanners to reduce delay

According to the acting President of ANLCA, Dr Kayode Farinto, the Customs is deliberately delaying the deployment because it wants to continue with 100 per cent physical examination, which gives them an opportunity to interface with importers and their agents directly. He said what is needed is “re-calibration” which is adjusting the equipment to suit the Nigerian environment, which is what is taking the Service over a year to do.

He said: “What they want is to continue making their personal money; they want to continue the direct interface which will give them the opportunity to demand ‘settlement.” Speaking on the development, president, Council of Maritime Trucks Unions and Association (COMTUA) Yinka Aroyewun, said that several factors are responsible for containers being trapped at the ports.

On why Customs is not operating with scanning machines at the ports, Aroyewun said: “To be honest with you, after scanning, in some cases, you may need physical examination because the scanner may not be able to detect certain things. “But the reduction of human interference which is going to be the major milestone covered by scanners is not going down well with our regulating agencies.

So, those are some of the reasons I think Customs, in some cases, are not comfortable using scanners”. He suggested that a way to get it right at the ports is for the government to bring its political will to bear. “We need the government’s genuine political will. Apart from political will, we all need to be patriotic; all of us and the agencies of government or the regulatory agencies the Nigerian

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