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Importers paying for abandoned cargo inspection scanners at ports

Wednesday, 30 May 2018 | 00:00

In 2005, the Federal Government entered into a 7-year contract with three service providers namely –Cotecna Destination Inspection Service Limited (CDIL), SGS and Globalscan Systems, to carry out destination inspection (DI) services at seaports, airports and border stations.

The implementation of the contract, which commenced in January 2006, was scheduled to end on December 31, 2012. Under the contract, the service providers were to supply cargo scanning machines at their various economic gateways on build, own, operate and transfer (BOOT) basis.

They were also expected to train officers of the Nigeria Customs Service (NCS) to take over the operations of the equipment at the expiration of the contract.

Specifically, the contract empowered the service providers to also provide the following services: risk management, valuation and classification; training and capacity building for Customs officers and the stakeholders; provision of tools and equipment as well as carrying out scanning services at ports.

Within the contract period, SGS covered the Port Harcourt main port and airport; Onne Port; Idiroko border post and the Ilorin International Airport. Global Scan covered Calabar Port; Warri; Lagos Airport and Seme Border Area while Cotecna covered Apapa Port; Tin-Can Island Port; Abuja Airport; Kano Airport; Jibiya and Banki border posts.

At each of these entry and exit points, the DI service providers, according to the contract term, provided millions of dollar worth of mobile and fixed cargo inspection scanners depending on the viability of the port in terms of volume of cargo handled, but in some cases one scanner while in some, both were provided to facilitate trade.

According to the Federal Government, the contract was initiated to strengthen the capacity of the Nigeria Customs by replacing pre-shipment inspection in exporting countries with inspection on arrival in Nigeria using the latest technologies.

This was in addition to taking care of notable irregularities which characterised international trade in Nigeria. Most importantly, it was seen as trade facilitation tool that minimised the need for physical examination, enhancing of regulatory compliance and collection of import duties/taxes.

After its initial life span of seven years, 2006 – 2012, the contract was extended by another one year, and it finally terminated in December 2013. Upon its termination, Customs became fully responsible for the inspection, valuation and classification of imports but has failed to fully continue to utilise the modern inspection machines in the seaports on the ground that they were obsolete.

Four years down the line, NCS has dumped the multi-million dollar inspection machines, and has returned to 100 percent manual examination of goods.

This development has no doubt has increased cost for importers, estimated to run into millions as businesses pay rent to terminal operators and demurrage to shipping companies for not clearing their goods within a specified time as a result of slow and cumbersome nature of manual inspection of containers at the seaports.

Alarmingly, importers’ containers presently spend weeks at the nation’s seaports over delayed clearance, such that containers that was supposed to be cleared in seven days, now about 22 days or more to be cleared due to the delay.

At the time DI contract, over 75 percent of imports were scanned and analysis reported to Customs and it enabled ease of cargo clearance. In those days, cargo dwells between 14 to 20 days compared to present time that it takes about 22 days and above to clear a consignment out of the port.

Confirming this, recent two trenches of survey conducted by Abidjan-Lagos Corridor Organisation (ALCO), a sub-regional intergovernmental organisation that promotes development, reveals that formerly in 2010 (when the contract was on), it takes a minimum of 20 days to clear cargo from Apapa Port, but a repeated study in 2016 (after Customs has taken over), stated that it now takes an average of 22 days to clear cargo in Apapa Port.

On his assumption of office, Hameed Ali, comptroller-general of Customs, who in several forum, assured port users of his commitment to fully restore the scanners into optimum use, has failed to keep to his promise as almost 90 percent of all the containers coming into the port and border station, were now subjected to 100 percent physical examination.

This, according to industry analysts, poses serious threats to smooth movement of goods and also increase cost of doing business as importers experience man-hour loss over Customs’ use of manual cargo inspection procedure to examine goods.

“Customs documentation and clearance processes have remained the same and largely manual since the Customs became in charge of DI services,” lamented Tony Anakebe, managing director of Gold-Link Investment Limited, a clearing and forwarding company based in Lagos.

Lucky Amiwero, a former member of the Presidential Committee on Destination Inspection, who identified the need to critically look at the breakdown scanners at the ports for possible repairs, said that the inspection machines while operational enabled trade facilitation for the benefit of businesses and the economy at large.

According to him, the present state of the scanning equipment at the seaports can be blamed on negligence and inability of the government agencies that supervised the transfer of the equipment from the DI service providers to Customs, to ensure due diligence before approving the handover.

“There is need to setup committee to reassess the scanner and other IT platforms at the ports. There should an audit on the level of the breakdown in order to put them back into operation. The fixed scanners are still very new judging from their ages that fall within four to six years, based on the date of installation and commencement of operation, while the mobile scanners, are within six to eight years old, which is still operational and acceptable internationally,” said Amewiro.
Source: Business Day Online

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