Comptroller Benjamin Aber is the Head, Information and Communication Technology Unit at the headquarters of the Nigeria Customs Service under the Federal Ministry of Finance.
In this Edition of Shippers’ Guide with Ifeoma Oguamanam of MMS Plus, he enlightens stakeholders on what to expect from a modernized trade system, how Customs can increase its revenue to meet its target and the road map to a National Single Window which is future of trade in Nigeria.
What are strategies that the Nigeria Customs Service is employing to facilitate trade in Nigeria?
Apart from collecting revenue for the Federal Government, one of the duties of Customs is to facilitate trade, we must now have to develop a platform where those regulators who are approving document for trade must be in harmony, in such a way that a trader can easily understand what he should do and how he should do it.
Customs took over from the service providers in the ports in 2013 and we changed what we used to know as Risk Assessment Report (RAR) to Pre-Arrival Assessment Report (PAAR) and if you work at two process half manual which required a lot of time to document but with the PAAR you spend less than 6 hours.
The documents that is being required from agents in Customs operations originates from regulatory agencies and we have cases of false documentations being given to our system resulting to lack of transparency in customs operations, so the only solution is to sit down with partner government agencies and reengineer the whole process from the start.
How does the trade document that initiates trade transaction connect the trade facilitation?
The document that initiates trade is the Form M. The digitalization of Form M is as a result of the need to reengineer the trade process, the Form M is the key stage of trade, the starting point of trade process and the Foreign Exchange (FOREX) control from Central Bank of Nigeria (CBN), the attachments to that document should be made available from National Food Drug Administration and Control (NAFDAC), Standard Organization of Nigeria (SON) and other regulatory agencies for regulators to see.
Now that the Standard Organization of Nigeria Conformity Assessment Program (SONCAP) has become an e-document it is available for Customs to see, we don’t have to ask for the document, this removes the issue of forgery and even the banks who upload it can verify that this SONCAP or Electronic Product Certificate (EPC) is genuine because it is registered on one platform.
This will facilitate trade because the environment will become more predictable; once you get your e-PC, you know that you have solved your problem with standard organization process.
We also intend to get NAFDAC to digitalize all their licenses and permit, so that they can follow the same process and at the end of the day, everybody not only customs but even security agencies can have easy access to the trade platform because sometimes we have security challenges that requires that goods brought in should be traced to its origin.
Before now we cannot check this but now our process is viewed at the office of the National Security Advisers, who can see and monitor what is coming in. This platform has given our national economy a very predictable outlook so that people who want to invest in Nigeria can be rest assured of the outcome of investing in our economy, this means that all Federal Government Agencies are branches of one tree and the role of each arm is operated in a transparent and simplified environment devoid of bottlenecks and corruption.
The importers can predict his trade because he knows what to expect and if he is a compliant trader, the platform we are building now is for legitimate business people
On the issues of smuggling in our various borders, sometimes you discover that people who engage in the act do so because the environment of trade is not conducive and they do not understand a better way. So, the customs decided to first and foremost build a right strategy, by developing a platform for any importer who wants to do legitimate business, who wants to build a profession and a legacy for his children, to come and invest in Nigeria, be compliant and do the business of trade.
Then the people who choose not to be trade compliant but prefer to use the border for smuggling activities, we will now deploy a new strategy to stop them. If we decide now, to go after all those using the border we might be chasing after those who are not even aware of the availability of a platform where they can do their business.
In the course of doing my job as Operations Officer, sometimes, we arrest goods or vehicles in particular and at the station, we discover that the person was led to believe that he was doing a proper Customs process and at the end was duped and issued false documents.
So what we are trying to do is to extricate the criminal elements that are not compliant and encourage those who are compliant, so that we can build a strong national economy, then we can now face the criminals who think they are smugglers.
We need to first identify legitimate trade by providing transparency in operations and build the economy, then we can develop a strategy of enforcement. Right now, we have collaboration with neighboring countries because of security challenges in our borders, we have seen that the vision of securing the country of Nigeria is also in the interest of our neighbors.
How can revenue be increased to meet the new revenue target?
When we talk about Customs generating revenue, you are aware that this is our core function, we collection revenue, where our processes is in a manner that cannot predict what is being brought in because as a Customs Officer, I cannot generate revenue if I do not have import, so I must manage what is being imported into the country, in such a way that the revenue that a throughput of a certain volume of cargo can generate is easily collected.
That is why we are building a platform that can manage trade so that we can predict the revenue generation.
Right now, we do not have a platform that can manage what is coming in, if we are not in control, then we cannot tell you that we can increase revenue , for instance, in 2006 when we started the modernization program, as an officer when we were working with the United Nations to convert our manual processes, our collection was manual; you take a receipt, go to the bank pay and come back to the customs with your teller.
We noticed people were actually cashing Federal Government cheques, at that time, there was a cartel involved, and then we said no, don’t give us cheques anymore, let us start an e-payment system and from that 2006 when we converted to e-payment, reconciliation is now direct from CBN per minute, immediately you pay the money is, then our revenue leap higher, unlike when it was manual reconciliation.
Documents can get missing, but as it stands now, the CBN and the Federal Ministry of Finance can access the platform easily, the issue of Customs short changing the Federal Government is no longer there, you can see visibly, when the importers pay through the bank.
Ever since, this led to revenue increase and it will definitely increase further when we institute more compliant strategies like the new e-certification platform from SON.
From now importers must get the EPC that is classified under a Customs HS Code which has a duty rate, this removes the issue of false or under declaration because there will be a certificate from SON stating that, for example, you are bringing in micro phones with your Taxpayer Identification Number (TIN), clearly written because the Federal Inland Revenue Service (FIRS), is now involved and identifies each trader on the Customs platform.
The item is classified already and the certificate issued from a partner government agency so the collection of Customs duty will be made easier and more accurate , the involvement of other government agencies on the same e-platform will definitely increase our revenue to a level comparably close to the target and the target is not just 35%, it is 100% of every item that duty is supposed to be paid on. We will collect it, and we can only collect it when we completely digitalize our trade environment and documentation.
The single window platform has not yet been implemented even as customs is partnering with other government agencies to ensure smooth trade facilitation. How does Customs plan to fully integrate the National Single Window in trade?
Processes starts gradually, when you talk about single window, it is when you have a global risk management environment for every stakeholder not only government regulatory agencies but private companies and entities within the trade, who have stake in the information system, to have an environment that can afford them, the opportunity for a very good sense of planning for their businesses, then you can talk of a single window.
First and foremost, we must get along with all partner government agencies who are part of the process of trade to be on one platform, that is why we built the Nigeria Integrated Customs Information System (NICIS), so that all government agencies understand their roles and trade is understandable to traders, when we have finished the concept, by then we can now build a road map to a National Single Window, which is bigger.
How will the single window be implemented?
We have to harmonize it, and also harmonize our data to cut across all stakeholders and represent an international data, we now have certified officers trained to capture data, take for example, if a banker wants to make certain facilities available to his customers the process of that facility will have to be articulated in the National Single Window, so that anyone who wants this service from the bank can easily access it on the single window.
It should be the same thing with the process of getting customs license for agents, the process of obtaining this license should be made easily accessible on line, so that agents can get them from the comfort of their offices in such a way that each user knows the channels to follow and how long it takes as well as how much it costs.
The national single window will invariably reduce complexity and unpredictability in the trade and presents, a very transparent and predictable platform that every government agency is on. That is why every country desires to go there but it is a gradual process.
What is the relevance of this, to the port system and trade in the ports against the back drop that Nigerian ports is one of the most expensive in the world?
The ports in Nigeria has a lot of challenges because we sometimes talk about only system but trade is a cycle, if we create the right digital environment and the infrastructure outside the Customs is not in harmony with the customs modernization processes this system will not fly.
First and foremost the Nigerian ports was established by the colonial government and when you look at Apapa ports and Tincan Island, such ports are supposed to have been discontinued. If we are to concession our port operations to a foreign company, Nigeria has a long sea shore, they should have been given a virgin land.
It will help to expand the economy; modern infrastructural development will move to that side and more people will be employed. Issues that are challenges in the ports system can now be addressed in the new modern ports.
This job should be a complete circle not just Customs responsibility but the responsibility of everyone who has a role to play; The shipping companies, the transporters, terminal operators, government regulatory agencies, all needs to have a vision of one country.