New Telegraph

Border closure: Sustained despair, one year after

Exactly one year after the Federal Government announced the complete closure of the country’s land borders, the Manufacturers Association of Nigeria (MAN) and others business owners are yet to recover from losses incurred. Taiwo Hassan reports

Regrettably, the decision by the Federal Government to shut the country’s land borders with neigbouring countries last year has not only worsened bilateral trade within Economic Community of West African States (ECOWAS) and the continent, but has been a setback to volume of trade within sub-Saharan Africa countries. Indeed, since the closure came into effect, the country’s real sector has never been the same again following the negative impact on the sector’s activities. However, one year after the closure, it has been lamentation from local manufacturers.

Genesis

Last year, the Federal Government had stated that the exercise, code-named, ‘Ex-Swift Response,’ which culminated into a partial closure of the country’s border with Benin Republic and others, was undertaken to curb challenges arising from severe economic leakages and insecurity through the border corridors. These challenges, government said, included armed banditry, massive smuggling activities, especially rice, illegal migration, illicit drug trafficking and proliferation of light weapons among others, adding that these had led to increase in insecurity and economic downturn. The exercise was jointly conducted by the customs, immigration, police and military personnel and coordinated by the Office of the National Security Adviser. Indeed, President Muhammadu Buhari explained the rationale behind the land border closure during an audience with his Beninois counterpart, Patrice Talon, on the margins of the Seventh Tokyo International Conference for African Development (TICAD7), in Yokohama, Japan last year. The president said that the activities of the smugglers threatened the self-sufficiency already attained due to his administration’s agricultural policies. “Now that our people in the rural areas are going back to their farms, and the country has saved huge sums of money which would otherwise have been expended on importing rice using our scarce foreign reserves. “We cannot allow smuggling of the product at such alarming proportions to continue,” he said.

Buhari said the limited closure of the country’s western border was to allow Nigeria’s security forces develop a strategy on how to stem the dangerous trend and its wider ramifications. While also speaking on the challenges confronting Nigerian border, the Comptroller-General (CG) of the Nigeria Customs Service (NCS), Col. Hameed Ali (rtd), explained that the NCS had engaged the customs administrations of the neighbouring countries severally.

OPS’ kicks

However, members of the organised private sector (OPS) insisted that it was time for the Buhari administration to urgently lift the suspension on the partial border closure one year after. The OPS, which is the leading voice in the country’s private sector, comprises of Lagos Chamber of Chamber of Commerce and Industry (LCCI), Manufacturers Association of Nigeria (MAN), Abuja Chamber of Commerce and Industry (ACCI), Nigeria Employers’ Consultative Association (NECA), National Association of Small Industries (NASI), Nigerian Association of Small and Medium Enterprises (NASME), Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) and others. They stated that if the suspension was not lifted, Nigerians should expect the country’s economic growth to remain subdued at around two per cent by year endd, saying that the country’s economy remains susceptible to external shocks. The private sector operators explained that government as a matter of urgency must intensify efforts in diversifying the productive base to other high-impact and growth-driving nonoil sectors like agriculture, manufacturing and services this year to fill the vacuum created by the border closure and COVID-19 in the economy. Indeed, local manufacturers and exporters under the aegis of the Manufacturers Association of Nigeria Export Promotion Group also urged government to reopen the Seme border and others with immediate effect one year after, insisting it was having dire consequence on the economy and the manufacturing value chains in terms of exports by land.

Economic losses

Apparently, MAN also berated government for the indefinite closure without recourse to the enormous implications for cross border activities around the country. Particularly, the association believes the look of things shows that government intends to jettison plans to reopen the land borders sooner than expected. Acting Director-General of MAN, Paul Oruche, told New Telegraph in a chat that local manufacturers were still sweating it out and yet to get over the negative impacts of the closure on their businesses and investments with revenue losses surpassing N1 trillion mark. According to him, the closure has resulted to disruption in trading between Nigeria and other ECOWAS countries with severe economic impacts. Oruche explained that the border closure had severely affected the shipment of Nigerian manufactured goods to the ECOWAS countries via land as Nigerian goods are facing mass rejections in neighbouring countries. The MAN DG insisted that it was unacceptable for government to shut down the whole borders in the name of smuggling of agric produce and ammunition at the detriment of trade promotion and facilitation along the ECOWAS trade corridor. He noted that there was no country in the world where smuggling of products does not take place but that it is the responsibility of government to control smuggling like other countries are doing without shutting down the borders. The situation has sent wring signals to other ECOWAS countries as the closure is taking longer than expected, which is a breach of international trade treaties of which Nigeria is a signatory.

Economic benefits

However, the Federal Government, over the period, insists that closing the borders has been more of a blessing to the country.
Minister of Information and Culture, Lai Mohammed, said that the closed border had drastically reduced incidents of cattle rustling, kidnapping, armed banditry and other forms of insecurity in the North-West. The Nigeria Customs Service has also claimed huge success from the border closure, while announcing daily revenue of N7 billion as against previous N4.5 billion. NCS Comptroller General, Ali, had equally expressed satisfaction with the exercise. “When we closed the borders, my fear was that our revenue was going to drop. To be honest, our revenue kept increasing. “There was a day in September that we collected N9.2 billion in one day. It has never happened before. This is after the closure of the border and since then, we have maintained an average of about N4.7 billion to N5.8 billion on a daily basis, which is far more than we used to collect. “What we have discovered is that most of those cargoes that used to go to Benin Republic and are then smuggled into Nigeria now come to us. “Now that we have closed the border, they are forced to bring their goods to either Apapa or Tin Can Island and we have to collect duty on them. If that (border closure) would continue, to us, it is a welcome situation. “Our revenue has not reduced. As a matter of fact, it is increasing as a result of the closure of the border. About 10.2 million litres of fuel have been cut down from what we assume, we have been consuming,” Ali said.

Last line

Members of the OPS are emphasising that suspension of the border closure policy by government this year was very critical for the revival of the country’s economic fortunes post-COVID- 19.

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