Dr. Kayode Colin Farinto, Md, Wealthy Honey Invest. Ltd.
Story by Dili Utomi.
The seeming volatility within the Maritime sector with particular reference to the operations within the Nigeria Customs Service shows no signs of ebbing as individuals and cooperate bodies are daily asking for certain surgical operations on the Service in terms of policies and personnel. The most recent call on the federal government to sack the minister of finance and also to disolve the Customs Management Team is coming from Dr. Kayode Colin Farinto, the managing director of Wealthy Honey Investment Nigeria Limited.
Dr. Farinto, a renowned freight forwarder with over thirty years of experience in cargo clearance and logistics operations made the call in a press briefing that he organised to enlighten Nigerians and also to warn the government about the impending economic doom looming over the country if the right and necessary steps are not taken to correct what he and many view as the anomalies plaguing the operations within the Nigeria Customs Service.
Dr. Farinto started by saying that “The events happening in the maritime sector has compelled me to say this. I am not a pessimist, neither do I hate the Nigeria Customs Service (NCS) as some may want to believe, but I want our customs to exhibit professionalism which is the bedrock of any revenue cum trade facilitation agency like her. Nigeria has been privileged to have professionalism in Customs particularly during the era of late Comptroller General of Customs (CGC), Dikko Inde Abdullahi (OFR) who engaged all relevant stakeholders particularly licensed customs Agents/ freight forwarders and it was like a he had magic wand. This was because the level of compliance began to increase then as he preached against duty evasion, sanctioned officers and defaulting Agents whenever it is detected. I do not want to enumerate his achievement but above all, one of the instruments that has formed the main document for cargo clearance was his introduction of the Pre – Arrival Assessment Reports (PAAR) which became stabilized despite the teething problems it initially had, but has since been improved upon”.
He stated that “The World Bank continuously rolled out data on how each country stands and since the inception of Col Hammed Ali (Rtd), Nigeria’s rating has continuously been bad. The logistics performance index (LPI) of a country is being measured using six key principles. Efficiency of the clearance process (i.e. speed, simplicity and predictability of formalities) by border control Agencies which customs is one of them. Everyone will agree with me that, we have never had it so bad on issue of customs clearance.
a. The issue of customs arbitrarily slamming their own data on the trading public has been militating against cargo clearance. Thereby issuing / slamming (25%) twenty five percent penalties. On any infractions even when it is not intentional. Relying and misinterpreting (on) section 164 of Customs and Exercise Management Act Cap 45.
b. When an individual, a DCG, quarries most declaration made throughout the country with impurity and unchecked. It is uncustoms.
c. The supervising ministry, which is Federal Ministry of Finance can no more regulate nor make the circulars issued binding except being subjected to an individual amongst the management team. An example is the issue of Import Duty Exemption Certificated (IDEC) which has been automated but still subjected to queries by the office of the DCG tariff and trade. This is gradually allowing importers, particularly on project cargoes to pay demurrages and storages on their imports.
d. Flagging off many declarations, this not less than (90%) ninety percent by putting incessant alerts by other departments of customs for pecuniary gain. (About 7 alerts on most declaration i.e., valuation, CIU, DC enforcements customs police, DC terminals, comptrollers office etc.)
e. Many of the comptrollers in the western ports have created another office called “monitoring units” to extort and arm-twist customs brokers and freight forwarders to either succumb to Arbitrary demand notices or settlement as the case maybe, if you must have a seamless cargo clearance.
f. The issue of joint examination even though may be said to be working in theory is not pragmatic, this is because, an officer of a unit in customs may subject any cargo to re – examination to frustrate the Agents to dance to their tone (i.e. settlement)
g. Deliveries of cargo: This has been another herculean task because after the cargoes/ containers are eventually cleared out of the ports, the Nigeria customs service had again mounted a road block just fifty meters (50m) to the port thereby subjecting the same cargoes that have been duly released to another round of examination or the Agents are compelled to part with money, by the under mentioned units, usually it used to be twenty thousand naira per TEU’s per unit of customs-the CG’s strike police”.
Dr. Farinto says that from the above, “it only means that for any container to get to the consignee’s warehouse, the consignees must pay about one hundred thousand naira per container as pocket money to have easy access as (pocket money). This becomes a norm, where the clearing Agents become helpless and are tired of complaining because anyone that cannot meet up finds his/her container at FOU where there are over twenty – five tables to get your container back, this is outside subjecting the said container to examination where customs at FOU have colluded with labor to extort examination money from Agents (20 ft attracts mandatory payment of N50, 000) fifty thousand naira. Majority of such jobs are slammed with demand notice (DN) which cannot be defended in this unit and once a DN is issued, you cant challenge it at FOU”.
The above according to the experienced clearing agent is “Just the first criteria by the World Bank on measuring Logistics Performance Index (LPI) of any country.
The second criteria is the quality of trade and transport related infrastructure (e.g. ports, railroad, road etc.), you will agree with me that the Nigeria government cannot even be scored (20 marks) 20% on this area and the last criteria is “timeliness of shipments in reaching destination within scheduled or expected delivery time”.
Finally he said that “Nigerians should expect that our rating as a country will not be favorable again this year because as at 2018, Nigeria was rated 2.8 which is very low, where other countries like Benin, Ivory Coasts have better ratings than Nigeria. It is rather unfortunate that seventy percent (70%) of the blames goes to the modus operandi of Nigeria customs service, deliberately flouting many international conventions which has been domesticated, which is done for pecuniary gains and extortion. (Among this is the valuation act), which states six principles on how to arrive at an acceptable value on commodities. The law stretches further that, “it must be in agreement with the importer or his representative – World Custom Organization (WCO)”.
However, he says that “we have a situation where the Nigeria customs service out of laziness to generate self-imposed targets (1) and (2) have many time thrown caution to the wind. If late Dikko Inde administration generated over seven hundred billion naira at the twilight of his administration, about seven years ago, when the naira was less than three hundred naira to a dollar, one wonders what the heck this management team is celebrating to have generated one trillion naira (IT) when dollar is over five hundred naira. The economy of the country is sliding to an abysmal level courtesy of NCS’s refusal to go professional. The issue of trade facilitation has been jettisoned while importers are continually being arm twisted to pay arbitrary demand notices on imported goods”.
The worst part he says “Is the non – uniformity in the clearance of vehicle. Vehicles of the same year and make pay different duties in all the ports. Even though the legal notices 30 allows for wear and tear or discount as per year of manufacture and despite the facts that we met the Comptroller General on several occasions that Agents are tired of giving bribe, let us have uniform value on vehicles, some management officers making their personal money from this avenue refused to let it be implemented. We also proposed the Ghana version, using VIN number already computed and once you make your declaration with G – NET or Ghana customs, your duties to be paid is shown and there is uniformity. Despite what Agents go through to clear this vehicles, you have many units of customs to contend with as soon as these vehicles are exited many customs unit intercept these vehicles claiming that Agents have paid a compromise duty, this once led to the shooting of our member by a drunk customs officer recently, we are bleeding as investors and this issue has gotten to a level that younger Agents may resort to self-help should this extortion by Nigeria customs officers continue”.
Dr. Farinto added that ‘The recent media seizures by the Nigeria customs service needs to be investigated. We now have what is called “Audio Seizures”, since they know the CGC is ignorant, you find some comptrollers calling press conferences for Audio Seizures, i.e seizures that never existed or repeating some seizure already shown to be public few years/ months back, this is not only un-customs but a disservice to the nation which requires a probe panel”.
He says that “The Honorable Minister of Finance has shirked her responsibility and have completely failed Nigerians. We have put up letters on several occasions to demand for clarifications on certain issues as regard import guidelines and on these occasions, the ministry has failed to respond and where she does, is unable to put NCS on her toes to abide by extant laws or directives or the policy of the Federal Government. A recent vivid example is the customs flouting Federal Government policy on importation of commercial aeroplane/ plane and her parts. Nigerians will recall that the CEO of Air Peace Airline protested publicly on the customs intention to collect 7% surcharge on Aeroplane when there is total duty exemption on this import. What such cargoes ought to pay is 0.8% ECOWAS trade liberalization scheme (0.5% of FOB) and other charges.
Even though the Central Bank of Nigeria’s act made her to be autonomous in monetary policy, but does not confer any legality on her to dabble into fiscal policy”.
The Central Bank Dr. Farinto noted “Has continually bastardized our economy by dabbling into fiscal policy which by extension has been affecting volume of importation into the country. The Federal Minister of Finance has an explanation to give to Nigerians by not acting when CBN started by slamming forex prohibition on about thirty two (32) commodities from assessing forex and where the importers have sourced for the forex in the black market they must still obtain clearance letter from CBN before importer are able to open form “M”.
Dr. Farinto recommended solutions by saying that “First and foremost, it has been evidently established that we need to rejuvenate the Federal Ministry of Finance by appointing another technocrat to move our economy forward and we need a honorable Minister of Finance that will able to supervise and direct the new management team of Nigeria customs service to be reconstituted. The first panacea to revamping our economy is to appoint a vibrant and versatile economist as honorable Minister of Finance because the present one lacks the ability to move our economy forward post covid – 19 pandemic”.
Secondly, he said that “The Federal Government must assist the economy if Nigeria will not be doomed economically, by appointing from the crop of intelligent young comptrollers that will move the economy forward and not amongst these ones that have not only eaten the forbidden fruits but infected by the current leadership in power. (Like covid-19 infection) we now have a situation where one individual is rated as the most powerful in the management of customs than the honorable minister of finance. We have a Comptroller General of customs that is evasive, he sees no evil, hears no evil. How can he know what his men are doing on the field and when he eventually decided to see a part of the association he continues to defends the misdemeanor of his officers” he concluded.
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