Importers groan as Nigerian government craves more funds from tariffs

A decision by the Central Bank of Nigeria (CBN) and the Nigeria Customs Service (NCS) to raise foreign exchange benchmarks at the seaports have created a fresh source of pain for importers and the customs brokers, who are already dealing with a difficult port system as coronavirus infections peaked in the country.

Early last week, licensed customs agents were greeted with a new forex rate at the seaports. The CBN raised the forex rate from N326 to N361 per dollar. This automally raised tariffs for the agents who usually bear the cost of clearing imported cargoes.

The tariff raise heightened tension at the ports, where the agents were already contending with high storage and demurrage charges caused by delay in the port system amidst inevitable restrictions to check the spread of Coronavirus in the country.

Only a few banks are working at the ports, and several shipping companies have placed control on their offices while not maintaining any form of automated transactions. This is causing delay in obtaining debit note from the shipping companies and in paying tariffs to the Customs Service, before consignments can be released.

Frank Ogunjemite, president, Africa Association of Professional Freight Forwarders and Logistics of Nigeria (AFPPLON) decried the new forex rate, saying it amounted to insensitivity on the side of the Nigerian government.

He said, “The increments  at this  ravaging epidemic time is barbaric and uncalled for when all the comity of nations are looking for the palliative measure to cushion the effect on their citizens.

“The simple implications is hardship of inflation on citizens because the costs of importation will be increased and possibility of further encouragement in smuggling thereby breeding possible avenue for loss of revenue to the federal government.”

The Nigerian naira lost strength steeply as the Coronavirus began to impact on the country. The government got the states to agree on a total lockdown for two weeks, thereby deepening unproductivity in the country.

The naira has over 20 points since February 28 when the Covid-19 hit the country, putting the naira at N384 per dollar as at Friday. The CBN had put the forex rate at N361 for the importers, but the shippers said the government T needed to make more sacrifice during this time when the country is on lockdown and considering the losses to demurrage and storage fees

“Yes, government should put the increase on hold as a sacrifice to the citizens at this trying time. Most other countries are experiencing same but none of them has taken such decision,” the AFPPLON boss noted.

Kayode Farinto, vice president of the Association of Nigerian Licensed Customs Agents (ANLCA) lamented difficulties in making declarations since Thursday when the Nigeria Customs Service began implementation of the new exchange rate.

“We just wake up and see that exchange rate has increased from N326 to N361. We are heartbroken that our government would behave like this at this time,” said Farinto.

According to him, customs brokers are taking the highest risk to come to the ports as essential workers in oder to move the economy forward.

“I call on leaders in the industry to prevail on the federal government to jettison this move as it may discourage the importers and the agents. We need to maintain status quo for now because we see that the oil sector has fallen but the govt can still manage to continue to patch the economy with whatever it makes from the maritime sector,” said Farinto who is vice president of the country’s largest body of Customs brokers.

He condemned CBN for “being in the habit  of not carrying people along in this country while the management of Nigeria Customs Service behaves like it is autonomous, as it doesn’t seem to report to anyone.”