•Say ‘we’re losing our West, Central African customers’
•As waybill done for customers from Ghana, Togo, others stranded at border
•Urge Customs to fight smuggling not trade
s the Federal Government insists that aside enhancing national security, the closure of the Nation’s land borders since August is bringing a lot of economic gains to the country, a visit to Nigeria’s key export markets– Alaba International, Balogun/Idumota, Lagos Trade Fair Complex and Aba Industrial Markets revealed a downturn in the fortunes of the markets.
This came against the backdrop of the Controller General of Customs, Col Hameed Ali’s (rtd) assertion that the closure of the borders has significantly increased government revenue from import duties.
This increase in revenue, according to economic experts, is a welcome fillip for a country struggling to close the 2019 budget deficit of a whopping N2.18 trillion (about 2 per cent of the country’s 2018 nominal GDP of N127.8 trillion).
However, traders in these export markets who said that they are not against the closure of the borders to checkmate smuggling, called on the Federal Government to allow legitimate trade to thrive while ensuring that illegal cross-border trade does not take place at the nation’s frontiers.
Nigerian export markets as losers
Recall that the Controller General of Customs, Col. Hameed Ali (rtd), two weeks ago, while showcasing the 33 container loads of expired rice intercepted by operatives of Nigeria Customs Service (NCS) at a Lagos Port, said though travelers with valid documents are allowed to cross the borders, movement of goods across the borders is not allowed at all while the border closure lasts.
This government stance, Sunday Telegraph learnt, has taken a toll on the businesses of the export markets in Lagos and the Aba Industrial Markets as the border closure has cut them off from their customers in the West and Central Africa.
Speaking on the development, Mr. Augustine Sokwue, principal partner of Sokwue, Sokwue and Co, also chairman of Zamfara Plaza, Balogun Business Association, Lagos International Trade Fair Complex, Lagos- Badagry Expressway, said these Nigerian export markets have lost over N300 billion in revenue in the three months the borders have been closed, as their customers from the West and Central African countries are either trapped in Nigeria or could not be able come to Nigeria to buy goods.
He said the border closure is negative in the sense that it has made legitimate cross-border trade impossible.
Sokwue who is also the legal adviser, Arbitration, Mediation and Reconciliation at the Trade Fair Complex, argued that the government’s position in this regard is counter productive, insisting that legitimate businesses going on along the corridors of ECOWAS region and the Central African countries on the Eastern frontiers of the Nigeria is over N100 billion per month.
“It is against this backdrop that I strongly believe that in carrying out this border closure exercise, the Federal Government must not paint the smugglers of rice and Okirika (used cloths) and legitimate businesses, with the same brush.”
Sokwue insisted that any country in the ECOWAS region has the right to import goods from any neighbouring country once the import duties are paid.
However, he said the congestion in Apapa Port is the main reason smuggling is going on across the borders.
He said if the Federal Government can develop ports in the South East and make the ones in the South South functional, smuggling will be reduced to the barest minimum.
“I am in full support of checkmating the smuggling of rice because it will boost our local production, increase our internally generated revenue and create employment. But the measure must be made to work and not the situation whereby law enforcement agencies will take advantage of it and be exploiting businessmen. This is because even now that the border is closed, rice is still coming into the country. The last time I went to Badagry High Court, I was in a commercial bus and I saw security agencies collecting bribe from people smuggling rice and allowing them to move on,” Sokwue said.
Also speaking, Mike Nwafor, a trader at Alaba International market, said a lot of their customers come from Niger Republic, adding that it is wrong to close the borders because of a single item or the said activities of smugglers.
He lamented that the waybill some of the traders did for their customers who are in Ghana, Togo and other ECOWAS countries are stranded at the border because of the closure.
Nwafor said the government should not feel that every good that is coming in through the border is illegal.
The export markets are large scale distributors of goods in Nigeria and to the West and Central African sub-regions. But they are different in the sense that while some only distribute and re-export imported goods, some package and brand the imported products before re-exporting; while the Aba Industrial Markets export finished made-in-Nigeria products.
Impediment to intra ECOWAS, Africa trade
An international trade expert, Mr. Bamidele Aiyemibo, said the continued closure of borders with the neighbouring countries is a trade impediment within the West and Central African regions, adding that it has crippled Nigeria’s economy and that of other neighbouring countries.
Speaking at the Non-Oil Exporters Regional Dialogue in Kano, an event organised by Policy Development Facility II (PDF), a United Kingdom aid-funded project for Nigerian exporters and business community in North West Region, Aiyemibo said that the Federal Government’s diplomatic policy also has negative consequences on inter-regional trade with Nigeria.
Aba shoemakers lose source of raw materials, patronage
Shoe manufacturers in Aba, the commercial hub of Eastern Nigeria have lamented that the border closure is affecting their businesses negatively.
This is as the Public Relations Officer of Nigeria Customs Service, Joseph Attah, a deputy comptroller of Customs, on Thursday in Aba, during a sensitization programme with stakeholders and different business groups, explained that the borders were closed to secure Nigeria, improve the economy and boost local manufacturers to get more patronage.
Attah said part of the positive impacts of the border closure is the great opportunity it presents for a city like Aba well known as centre for quality locally made goods to blossom again as a renowned Industrial hub.
He said: “Aba is a city that’s known for creative individuals. It is also known for high quality locally made products. Why would somebody think that product made in Aba is not original?” he queried.
However, when Sunday Telegraph visited most of the shoe clusters in Aba, the reaction was not as palatable as the Customs image maker sounded.
Shoe manufacturers lamented the absence of their large West African neighbours who form the largest population of their customer base.
A visit to Samek, Ariaria, Powerline, Shoe Plaza and Umuihelegbu Industrial Market which are the major clusters for shoe manufacturing, revealed that the markets are no longer booming as they used to.
Mr. Emmanuel Okeke, a shoe manufacturer at Samek shoe cluster, said that the border closure has automatically shutdown business at the cluster, thereby affecting them more negatively than the expected positive.
“The truth is that the way the border closure is affecting us negatively is multidimensional. One is on the raw materials we used in making these shoes. Most of them are from Ghana and other West African countries.
“These materials have become scarce all of a sudden and the ones you see are very expensive. Again, the border closure has crippled our one large patronage from the neighbouring countries.
“Made in Aba products are consumed more in the West African Markets than Nigeria. Our customers there cannot longer come here to buy because they said Customs have placed high tariff on the goods they bought from here.
“The Togolese, Malians and those from Central Africa Republic, especially their middle class, depend on our products here in Aba. They solely depend on us, but they can’t come again.
Customs duty on export too high
Meanwhile, the traders in Aba Industrial clusters, Alaba International Market and Trade Fair, said one of the major setbacks of the border closure is the export tax the NCS imposed on goods leaving the country, saying their customers from West and Central Africa are deterred by this high export tax.
Speaking, Chief Laz Umezurike, a shoemaker at Powerline Aba, said: “Some of our customers have not even been able to cross the border to return to their countries since they came here to buy because of the high tariff Customs placed on the goods that they came here to buy. We don’t have customers again. Everywhere is dull.
“Some of my customers told me that the amount they pay as duty is high and when they get home and increase price, it reduces their patronage in their countries.
“Even our customers from the North and Cross River who usually come to buy from us and resell to those other countries within their borders cannot do so again because it is difficult to clear goods away from the borders.
“Niger Republic, Chad, Mali and others are no longer coming to buy from our Northern brothers and in turn, our Northern brothers cannot come to Aba to buy again because they cannot sell when the buyers are not coming to them.
“We beg government to try and reduce the tariff of goods that are manufactured in this country that is also leaving the country to other countries. Let them reduce the export duties they placed on those goods produced here,” he said.
He advised the NCS to focus more on goods coming into the country than the ones going out “because that’s the only way we can grow. I can’t ask government to open the borders, but let them reduce the duties on goods going out of the country to encourage the manufacturers here because that’s the only way we can get patronage.”
Another manufacturer, Samuel Ikonne, who spoke to Sunday Telegraph at the shoe plaza said the border closure ordinarily ought to have been positive, but it has become negative to them because their goods are no longer getting to the major consumers who are in the neighbouring countries.
“They need to look into the tariffs and help us so that our goods can be moving too. The competition between us and importers has been going in our favour because of the way we get patronage from our neighbouring countries,” Ikonne said.
He further said that the Nigerian market is not locally conscious enough to consume what Aba is producing because everyone’s eyes are still looking at the foreign ones.
In reaction to the claim of high export tax on goods exported by the traders, the Customs PRO, Joseph Attah, told Sunday Telegraph on telephone that “there is no duty on export.”