Nigeria along with other members of the Economic Community of West African States will on January 1st 2015 adopt a Common External Tariff.
The adoption of the CET is also expected to lead to cooperation among all customs organisations within the sub region and they will operate as a single union with uniform duties and other trade policies.
Initiated to enhance the economic integration process in West Africa, the agreement was signed by the ECOWAS Authority of Heads of State and Government at an extraordinary session in Dakar, Senegal in October 2013.
However, stakeholders in Nigeria’s maritime industry have expressed mixed feelings over the adoption of the CET. While some praised the initiative as a positive development for the economy, others voiced their fears about the process.
The President, Shippers Association of Lagos State, Mr. Jonathan Nicol, told The PUNCH that the CET would put an end to the frequent seizure of domestic goods by the Nigeria Customs Service under the guise of being contraband.
He said, “I think this is a good thing for Nigeria because we are a giant economy in Africa and should not be closing our borders to others. We should be able to accommodate them. The ratio of sharing to Nigeria is fair at 65 per cent.
“The adoption of the CET will also take officials of the NCS off the highway as there will be no reason to seize goods. It will bring in a lot of cargo in the country but the problem is how to manage it.
“Nigeria has over the years lost a lot of cargoes to our West African neighbours. With the CET, we will get all these lost cargoes back because the policies and duties across all countries will be the same. Shippers who have left the country will return.”
Nicol added that the manufacturing industry in Nigeria would be given a boost as there would be a massive exportation of made in Nigeria goods to West Africa.
He said, “We should look at the gains of the CET for our industries. If you manufacture quality goods, people will look for you. Your products will be sought after by other countries in West Africa and there would be massive exportation of what you manufacture. Business will boom for industries that manufacture quality materials.
However, the President of the National Council of Managing Directors of Licensed Customs Agents, Mr. Lucky Amiwero, questioned Nigeria’s ability to adopt the CET successfully.
He said that there was nothing on the part of the NCS to show that it was ready to become a regional body as most custom officials were not aware of the CET and its implications.
He also called on the Federal Government to ensure that basic social infrastructure such as electricity was in place if Nigeria must compete favourably with other countries in the sub region.
Amiwero said, “A unified customs union means that all customs procedures and tariffs, save for a few exceptions will be one and uniform; this has already been signed. ECOWAS as a region has agreed on what we will pay on each consignment; that is called tariff treatment.
“Ghana has its tariff lines treated and most of the exceptions are clear. They have also streamlined their process in line with the World Trade Organisation. Although Nigeria has treated its tariff lines, there are still a few hiccups here and there.”
He expressed dissatisfaction with the current customs procedures and called on the Federal Government to enact policies that would encourage employment generation.
Amiwero said the CET was a partnership agreement between Africa and the world and not just the sub region, noting that Nigeria was working towards the eventual integration with the world trading community.
He said, “Trading is a process; we must meet up with the international standard. You must also know that Nigeria controls 80 per cent of the trade within the sub region. Most custom officials are not even aware of the CET; they are just interested in revenue generation and this will not make a nation to grow. The policies that will make us grow are those that generate growth and bring about wealth; policies that will bring about employment generation.
“The Harmonsied System Codes has been recodified to accommodate some amendments; the customs made effort in this regard. Most of the processes in the former harmonised system (in 2007) have been upgraded. There are 220 amendments in the new system which is the 2012 HSC. Some of these amendments have to do with agriculture and other things which have been reflected in other global HSC.”
He expressed disappointment with the government and the NCS for failing to organise seminars and workshops to educate stakeholders on the adoption of the CET.
He said, “If we are not careful and our policies are not in line with international standards, industries in Nigeria will move to other countries in the sub region and export the same goods they have produced back to Nigeria. While our neighbours will be creating employment for themselves, Nigeria will simply be an importer of finished products. Other West African citizens would have a work base because they have the facility, infrastructure, the process and comply with the rules.
“A lot of industries have already moved out; but now we are going to have a single market for the whole region, Nigeria should be addressing the issue. Basic social infrastructures such as good road network, water, security and electricity supply have to be put in place if the CET is going to be a success for Nigeria.”
Amiwero urged the NCS to comply with international conventions and protocols domesticated in Nigeria in the discharge of their duties.
Although the Manufacturers Association of Nigeria said it was supportive of the CET, it called attention to its effects on industries.
The President, MAN, Mr. Frank Jacob, said the association had taken its concerns to the government.
He said, “MAN has taken its concerns up with the government. For instance, there are 196 items that MAN wants government to reclassify for the advantage of manufacturers. There are also 241 items that are currently enjoying various levels of levies from the government. This is meant to protect the manufacturing sector. As of now, the government is trying to accommodate these interests.
“We are still in discussions with the government. Each country in the sub region is allowed three per cent of the tariff line as a means of protecting their industries and the government is currently compiling the list of items that will be excluded; MAN is also part of this process.”
Despite negotiations with the government, Jacob said not all the items of concern to MAN could be accommodated by the government in the exclusion list.
He said the hands of the Federal Government were tied to the extent that only 177 items could be accommodated in the exclusion list which would be forwarded to ECOWAS upon completion.
He said, “Even at that, we are not sure that MAN’s interests would be fully protected although we subscribe to the notion of ECOWAS common market because integration is the way to go. We are just hoping it would not affect manufacturers so adversely.
“It is hoped that the exclusion list will address some of our concerns although not all. Compared to 241 plus 196, 177 items to be excluded from the CET is a far cry but we still hope it will go some way. There will still be some areas where we need government to do something. We are still negotiating with government so that they can use some other instrument to ensure that our industries are protected.
“With the devaluation of the naira and dwindling prices of crude oil globally, there is not enough money to go round. So, we have to look inwards for industrial inputs that we can obtain within Nigeria. MAN has to tighten its belt and look inwards for our raw materials because that is the only sustainable way we can remain in business.” – Punch.
