Olaseni Durojaiye writes on the new guidelines for import and export, which the federal government plans to implement from January
The federal government has made effort to improve the ease of doing business in the country, particularly as it concerns international trade, with the introduction of new guidelines for export and import. The government wants to address some of the nagging complaints by players in the sector. Expected to kick off in the New Year, the new policies largely align with global best practices.
Removal of Red Tape
The guidelines are meant to fast track the export and import business and address one of the main problems faced by operators in the sector – time spent exporting or importing goods.
Before now, exporters complained about a cumbersome documentation process and long delay before goods are exported. The long delays often lead to losses, as perishable goods rot in containers while documentations and clearance permits are perfected. Industry insiders blame the long delays on proliferation of agencies at the ports and the time it takes some of the government agencies to attend to the exporters.
Operators in the sector have for long clamoured for a centralised export agency that would handle everything that has to do with export. According to Managing Director of SCL Logistics, Nduka Udeh, all the agencies concerned with export should be housed in a centralised location, preferably near the ports.
Speaking with THISDAY, Udeh stated, “That’s the Chinese model. When the Chinese wanted to position Huawei as a leader in the telecoms industry, they came out with a policy that no Huawei goods should be at the ports for more than 24 hours. The policy ensures that they must have their export clearance within 24 hours; so when companies were negotiating for deals, whilst a Siemens will tell you that it will take a month for your goods to arrive, in a week or thereabout Huawei has delivered the same goods. That is the kind of process that we need to put in place to grow our non-oil export and truly diversify the economy away from over dependence on oil.”
Indeed, the need for diversification of the nation’s economic base has necessitated exploration of the economic potentials of different sectors of the economy, including export. Mindful of that, the federal government had moved to streamline operations at the ports. Part of this was a reduction of government agencies at the ports. The latest export and import guidelines are seen by economy watchers as being a furtherance of that initiative and welcomed by many.
Enabling Business Environment
In February, the federal government announced plans to reduce the numbers of agencies at the nation’s seaports to six. The initiative was part of the decisions reached at an expanded meeting of the Presidential Enabling Business Environment Council.
A statement from the PEBEC said, “The reforms are to be implemented by the Enabling Business Environment Secretariat, which became operational in October 2016 and has Dr. Jumoke Oduwole, the Senior Special Assistant to the President on Industry, Trade and Investment as its coordinator.
“Also, work is on-going to streamline the number of agencies operating at the nation’s ports to just six. Council also listened to updates on the proposed Single Window Initiative at the ports, which is expected to become operational by Q4 2017.”
The Minister of Finance, Mrs. Kemi Adeosun, announced the latest import and export guidelines at a forum in Abuja recently. Before coming up with the guidelines, the federal government had considered concerns expressed by the trading public regarding the palletisation policy. Adeosun explained that the review of the Nigerian Export and Import Guidelines was motivated by the desire of the present administration to deepen ease of doing business in Nigeria, in line with the Executive Order 1. She said attention had been focused principally on measures to ensure drastic reduction in time spent on processing of exports, ensure 24 hours clearance of imported cargoes, and block leakages of revenue accruable to the government. The minister said Nigeria had moved to the 145th position out of the 189 countries in the World Bank’s ease of Doing Business Index for 2018.
Adeosun said the government had adopted a number of measures to improve trading across the country’s border. The measures include reduction of documentation requirements from 10 to seven days for exports; and from 14 to eight days for imports. She said additional responsibilities had also been given to the Nigeria Customs Service and Nigeria Ports Authority, and sanctions had been introduced to enforce compliance. The minister said the Sensitisation Workshop was, “an auspicious start to interact with the trading public and is tailored to enlighten the relevant stakeholders on the major provisions of the 2017 revised Import and Export Guidelines.”
President of the Manufacturers Association of Nigeria, Dr. Frank Jacobs, welcomed the new guidelines but noted that palletising goods would reduce the contents of a container. Jacobs added that it would impact production cost. He also noted that not all goods could be palletised even as he disclosed that MAN had made representation to government. He also stated that the association expected government to grant it concession.
Jacobs explained, “The only aspect that some of our members have complained about is the aspect of palletising. Having to put all goods in pallets will reduce what can go into a container and this will affect production cost and it means adding more cost and our members are not happy about that. Besides, some products, due to shape and sizes, for example, automobiles, cannot be palletised.”
In the same vein, the Lagos Chamber of Commerce and Industry has expressed concerns about aspects of the guidelines. In a statement obtained by THISDAY, the chamber argued that some aspects of the guidelines “portend weighty unintended adverse consequences for business which are obviously not in tune with the current disposition of government on Ease of Doing Business.” It added, “The economics of investment of some businesses will be completely upturned if the guidelines are implemented in its current form.”
The statement signed by Director General of LCCI, Mr. Muda Yusuf, said, “The worrisome aspect of the circular is the section that stipulates as follows: ‘Shipping Lines shall ensure that Nigeria bound containerised cargo are palletised. Shipping Lines and other carriers that failed to adhere strictly to palletised cargo shall be asked to take back on board the non-palletised cargo.
“The LCCI appreciates the good intentions of government in coming up with this policy. But the reality is that not all containerised cargo is amenable to palletisation. Some of these include tires, chemicals in drums, and plastic raw materials in bags, powdered milk and similar products which are imported in bags. Palletisation of these products will be clumsy, aggravate the cost of freights, cause gross underutilisation of container space, creates risk of damage to cargo, among other unintentional negative consequences.”
The chamber stated, “While the request of the stakeholders is being considered, the implementation of the palletisation component of the guidelines be suspended.”