NIGERIA is currently losing billions of Naira in revenue at the nation’s ports due to the refusal of the Nigeria Customs Service (NCS) to clear or auction overtime cargoes from the ports, investigations have revealed.
This is even as findings revealed that the number of overtime cargoes at the ports is gradually reaching an alarming level since the last auction or clearance of such cargoes took place about six years ago.
Speaking to the Nigerian Tribune exclusively on the matter, spokesman of the Seaport Terminal Operators Association of Nigeria (STOAN), Mr Bolaji Akinola, explained that if care is not taken, over half of the port terminals would likely become dedicated for storing of overtime cargoes at the ports.
The STOAN spokesman said: “The law is clear on this issue. The law says after 90 days of grace period, if a cargo is still not cleared from the ports, it becomes an overtime cargo and is taken over by government through the Nigeria Customs Service (NCS). After the take-over, such cargoes are gazetted and a court order is obtained for them to be auctioned. Why the Customs have not been doing this for the past six years beats our imagination.
“The cargoes can be auctioned right where they are inside the ports. Don’t forget that the Ikorodu Lighter Terminal where such cargoes are taken to is already filled to the brim. Even the government warehouse in Ikeja is also filled up. The port terminals, as we speak, are already filled up with overtime cargoes. We know that for port operation to be efficient, space is very vital. If you allow all the port space to be taken over by overtime cargoes, where will incoming import unit of containers be stored?
“It is important for us to allow our ports to operate as transit areas and not as storage facilities. We have overtime cargoes that have been inside the ports for over five years. How do you justify that? When containers stay in the ports for over five years, how do we expect efficiency from such ports? This is certainly not good enough for our economy.”
When asked to explain how Nigeria loses revenue to the prevalence of overtime cargoes at her ports, the STOAN spokesman said, “In Naira and Kobo, Nigeria loses revenue through the Customs and the Nigerian Ports Authority (NPA). Don’t forget that the Customs collect duty on cargoes that pass through the ports. So, when a container has stayed in the port for over five years, how will Customs make money for the country from such container? These containers have been sitting there for the past five years, taking up spaces unnecessarily, and government has not made a kobo from such containers because nobody has come to clear them.
“For the NPA, the terminal operators pay the agency throughput revenue on the numbers of cargoes handled. When some containers have been sitting there in the ports for more than five years, taking up spaces that ought to have been used to receive other containers, the amount of revenue the NPA will collect from the terminal operators will be reduced. It’s like running a car park that can take 100 cars at a go. The owner of such car park makes more money on a daily basis when people bring in their cars and take them away after one or two hours within the same day. Such spaces will be used to accommodate newer cars and the owner of such car parks makes more money. But when 100 people bring in their cars and leave them there for a whole day, then the owner of the car park makes less revenue. In this case, the car park is the port and the owner of the car park is government. The terminal operators, the shipping companies, everybody loses.
“We are gradually getting to a point where over half of the port is being used to store up overtime cargoes. When we get to that point, vessel queue that has been eliminated years ago will return. And if vessel queue returns, operators will re-introduce congestion surcharge. Now, we are complaining of the cost of freighting to Nigeria. If we continue like this, the cost of freighting of cargoes to Nigeria will double.
“The solution to this quagmire that we find ourselves in is just for Customs to auction these cargoes where they are inside the ports. There is no need to look for where to move them to since most destinations are already filled up. Customs should just auction these containers where they are. Why this has not been done is mind-boggling.
“I remember in the 1990s and early 2000, I participated in a Customs bidding process and won a container in Seme. I went there and picked up my container. I also won an auction in Tin-Can port back then and went there to pick up my container. I am saying this to let you know that Customs has no excuse in not allowing the cargoes to be auctioned right there inside the ports. They can get auctioned right there, and the winners will come there to pick up their containers. Even auctioning those containers cannot restore what the country loses in terms of revenue.”
When contacted on why there are so many overtime cargoes inside the ports, the acting NPA Managing Director, Mohammed Bello-Koko, explained that the agency is currently pleading with the Nigeria Customs Service to auction the containers inside the port terminals.
Bello-Koko said: “We are working with the NCS to ensure gazetting of the overtime cargoes and also movement of such cargoes to other locations.
“Ikorodu has already been filled above capacity. We are even pleading with NCS to auction on site. That’s at the terminals since there is no space at Ikorodu.”
The Customs Area Controller of the Apapa Area Command of the Nigeria Customs Service, Comptroller Yusuf Malanta, recently said that due to the huge cost of moving overtime cargoes to other locations from the Lagos ports, the Customs cannot bear the cost of such exercise.
“There are currently about 500 overtime containers, including import and export, at the Apapa Port and it will cost an average of N600,000 to move each of the containers from the port to Ikorodu. Who bears such cost? We are not ready to bear such cost.
“Moving containers to Ikorodu terminal entails a lot of logistics and financial commitment. To take one container from here to Ikorodu will cost at least N600,000. Now, if we are moving 500 containers to Ikorodu, how much will that translate into? However, we have a series of procedures before it comes to moving containers and even moving containers to Ikorodu is the responsibility of the NPA not Customs.
“Customs will make sure that they receive unclaimed cargo lists from the shipping companies and the terminal operators, then they will now examine those unclaimed cargo lists after the free storage period. After examination, they will leave it for a certain number of days for importers to come and claim their cargo. After the date expires, they will send it for gazetting by the court because of litigation. When the court gazettes it, it will now go for auction,” the Apapa Customs Controller said when he hosted journalists from the Shipping Correspondents Association of Nigeria (SCAN).
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