How customs raked in over N1tn in 2020 despite border closure  

In this piece, ANOZIE EGOLE reports on the economic impacts of the 16-month-old border closure by the federal government

It is no longer news that on August 20, 2019, the federal government decided to close its land and maritime borders, a move made to address the lack of adherence to the Economic Community of West African States Trade Liberalisation Scheme’s protocols.

The closure was also enforced to tackle trans-border security challenges that included terrorism, armed banditry, smuggling, the proliferation of small arms and light weapons amongst others.

It is also not news that smuggled goods still flood Nigerian markets since the closure of the borders.

What now makes the news is that the NCS claimed that the closure led to a significant increase in revenue generation, with N1.5tn collected in 2020 despite the adverse effects of COVID-19.

However, the closure provided an opportunity for diplomatic engagements with the neighbouring countries and even ECOWAS’ intervention, which eventually extracted firm commitments to adhere to the ECOWAS Protocol on transit, that all transit goods should be escorted to the border of the destination country in their original state and handed over to the customs service.

Meanwhile, further findings have shown that the closure of the land borders has led to a massive increase in importing milling machines and other associated equipment to produce rice and other agricultural commodities.

It certainly will spawn a wide range of businesses poised to take advantage of this ongoing agricultural revolution a reason the Small Medium Enterprises want the borders to remain closed because it represents opportunities for wealth creation and growth.

In a statement by Deputy Customs National Public Relations Officer, Timi Bomodi, obtained by Financial Street, the agency explained that between August 20, 2019, when the closure took effect, and December 2020 when it was terminated, the operations made very significant interventions.

During that period 1,401 irregular immigrants were arrested, 10,447 bags of fertilisers used for making explosives, 159,506 bags of foreign rice, 1,974 vehicles, 895 motorcycles, and 18,690 jerry cans of vegetable oil were seized.

Bomodi added, “Again, the tripartite meetings that took place between the customs administrations of Nigeria, Benin, and Niger gave birth to the setting up of joint border patrols on both sides of our borders, which is already in operation.

“Team leaders of the three countries now share intelligence assisting each other to curb the activities of smugglers. The above achievements have a great impact on the national security, the economy, and the general well-being of citizens. Outcomes of these engagements will no doubt create enabling business environment for businesses to thrive.

“The entire operation took place over approximately 480 days, meaning that on average, this team recorded over 400 seizures and arrests daily for 480 days consecutively, a tremendous achievement indeed. As a result of the border closure, importers who hitherto exploited weaknesses in our borders to evade the payment of duty were compelled to use our ports.”

Speaking on the African Continental Free Trade Agreement, Bomodi stated that the NCS was ready to implement to the letter the terms of the AfCFTA.

“All we await are the necessary data from the National Action Committee and the National Office on Trade Negotiation as to the list of duties and charges waived for liberalised goods under AfCFTA. We also await the list of 90 per cent liberalised trade offers, seven per cent non-liberalised exclusive goods at the regional level, and the list of three per cent non-liberalised sensitive goods. All this information shall be deployed into our system and made available for operational use.

“We understand the significance of AfCFTA and the impact it can have on our region. We also appreciate the threats a poorly managed transition into AfCFTA presents to businesses within the country. This is why we insist on a methodical approach to data collection, collation, and deployment for easy access to the trading public. It is our firm belief that informed and objective criticisms contribute greatly to national development, and we embrace them wholeheartedly,” he explained.

With the end of the 16-month-old border closure, many Nigerians believed that the closure did achieve its set goals, but that smuggled items still found their way into the Nigerian market.