INDICATIONS are rife that more than 2000 car dealer shops located in Benin Republic has closed shop following Nigeria’s ban on vehicle importation through the land borders.
According to findings by Tribune Online in Seme, the nation’s border town with the Republic of Benin, many hitherto thriving car dealer shops in Cotonou have closed shop since there is no longer any business across the border again. This is even as findings revealed that many importers are losing billions of Naira to constant vehicle seizure and forfeiture triggered by increased Customs surveillance.
Speaking to Tribune Online, a cross border vehicle agent, Kingsley Anagor, who used to do businesses with many car dealers in Cotonou explained that more than half of his customers have parked up.
According to him, “You know that majority of the car dealers in Benin Republic are Lebanese. That’s the main business there. Many of them have invested so much in this business. Many have brought in many luxurious cars with the Nigerian market as their major destination prior to the ban.
“But recently, when I went visiting to collect some debt owed me by some of my clients who we have done businesses together, I was shocked to find out that many have closed shop. Some of my debtors have simply disappeared into thin air with my money.
“There are over 3000 car dealer shops in Benin Republic. But as I speak to you, more than half has closed shops. Go to Benin Republic now, many are roaming the streets doing nothing.”
When asked why car dealers shops in Benin Republic are closing down since vehicles still get smuggled into Nigeria, he explained that, “ Yes, guys go into Benin Republic to smuggle vehicles into Nigeria, but the success rate is very average these days.
“The Customs have deployed all their officers hitherto on the border vehicle seats to patrol teams, thereby bolstering its patrol force.
“The success rate of smuggling is now very average. This Customs guys know all the routes. Although smuggling still takes place, many vehicles are being caught these days because the Customs suddenly has more hands in its patrol team.
“That was why the truck carrying 661 pump action rifles was nabbed after being cleared by some other Customs guys at the ports.
“With increased surveillance by Customs after the vehicle ban, buyers of vehicles across the borders now only pay completely after delivery due to the reduced success rate of smuggling. This has cost many of the car dealer’s in Cotonou billions of Naira, and has forced more than half of them to close shop.
“Many vehicles have been seized by Customs. Many of these seized vehicles were half paid for. The fear of forfeiture by the owners led to half payment agreement. Full payment only happens if the smuggling is successful.”
When asked if the half payment system started after the ban, he stated that, “Yes. It was a way out of the economic mess the ban was heaping on Cotonou car dealers. Many of them became jobless and were going bankrupt. They needed to survive.
“So some agents came up with this half payment arrangement. Buyers pay half and complete the payment when the vehicle arrives at its destination. The car dealers employ his would-be-smugglers to bring the car into Nigeria.
“They collect the balance if the smuggling is successful. It’s a method of sharing the risk involved due to the increased surveillance by Customs. If the smuggling is successful, the seller gets his balance. If not, both the seller and the buyer lose because the buyer has already made half payment and the seller is yet to collect his balance while not getting his vehicle back.
“That is the reality of life now at the borders. Many car dealers’ are closing shops in Benin Republic because the success rate of smuggling has gone down.”