Why cargo clearance is expensive at Nigeria’s seaports —Investigation

Investigations have revealed that charges accruable to the Nigerian Customs Service (NCS) during cargo clearance at the ports atone more for the expensive nature of Nigeria’s seaports.

According to a yet to be published industry report on a 20ft container that was imported into the country from China, statistics revealed that of all the charges that accrue into the coffers of operators at the ports, the Customs, a revenue generating agency of government gets the lion share of payments during the clearance procedure..

The report which was sighted exclusively by the Nigerian Tribune revealed that during cargo clearance at the ports, the following parties get paid accordingly: the Shipping Company, the Terminal operator, the Nigerian Customs Service, Clearing agents, and the truck owners.

Further findings revealed that if the 20ft container is filled with goods worth N33million and it stays inside the ports for 4 day, then the consignee (owner of container) will pay a total of N4.8million, using the exchange rate of one Dollar to N330. The payment covers from when the 20ft container left its port of origin in China to its final destination in Nigeria.

A breakdown of the amount paid (N4.8m for 4 days) by the consignee to various operators at the port revealed that the shipping company gets 13.8 percent of N4.8m as freight. The Terminal operators gets 1.4 percent of N4.8m; the Nigerian Customs Service gets 81.7 percent of N4.8m; the clearing agents get 1.7 percent of N4.8m; and the truck owners (haulage) get 1.4 percent of N4.8m. This sharing formula is premised on the basis that a Dollar exchanges for N330.

However, due to the fact that cargoes spend almost a month waiting to be cleared at Nigeria’s ports, the report also explained that in a situation where the cargo stays in the ports for 21 to 25 days, then the total cost of payments to be made by the consignee will become N5.1m. This is so because the cargo is staying longer, therefore the payment to shipping company’s and terminal operators will also go up due to demurrages.

Payment to the Customs is still highest at 77 percent, Terminal operators get 3.6 percent, shipping companies get 16.5 percent, Truck operators get 1.4 percent and clearing agents gets 1.6 percent all of N5.1m paid by the consigness under a 21-25 days caro clearance period. The increment in charges of the terminal operators is down to the fact that the longer the cargo stays inside the ports, the more demurrages the owner of the consignment will pay.

When asked why the Customs get so much during cargo clearance, the Spokesman of the Seaport Terminals Operators of Nigeria (STOAN), Bolaji Akinola explained that Customs alone get up to 4 or 5 different payments from importers.

In his words, “the consignee (owner of container) pays charges like Import Duty, CIFF, Surcharges, ETLS, and VAT to the Customs at the ports. That is why the Customs gets the lion share of payments during cargo clearance. Things like this have made Nigerian seaports very expensive. Even agents get more than the terminal operators during cargo clearance.

“That is why cargoes have dried up at the ports. Most of these cargoes are being diverted to neighbouring ports. There is need for government to look into these charges to make Nigeria’s port competitive again.

“Terminal operators are paying their bills through their noses because there are no jobs at the ports anymore. Many have been sakced to ensure we balance our books, yet it still does not add up. We are humans and cannot continue sacking people.

“That is why we are always making appeals to the government at every opportunity that there is need to look into charges like the Customs duty. These fees have driven away patronage of Nigeria’s seaports.”