Why Importers Should Adopt Transit Insurance – Chikezie

By Kenneth Jukpor

Hon. Kingsley Chikezie is the National Secretary of the Importers Association of Nigeria (IMAN). After the launch of the Economic Community of West African States (ECOWAS) Trade Liberalization Scheme ‘ETLS’ handbook by Nigerian Shippers’ Council (NSC) in collaboration with Borderless Alliance last week, Chikezie sat with MMS Plus newspaper for this interview. He bares his mind on several challenges affecting cross-border trade and proffers solutions. Excerpts:

How significant is today’s workshop and launch of the ‘ETLS’ handbook to Nigerian importers?

This has been a wonderful seminar and a good awareness campaign on the ECOWAS Trade Liberalization Scheme. There is a proverb that says our people perish because of lack of knowledge. If you don’t know anything, you don’t know it.

Most importers are doing international trading that can be done within the West African sub-region. We can do such trading nearby and still make profit. The last time I travelled, I told my family I am no longer travelling out. I had taken a flight from Nigeria to China which took over 16 hours; you can imagine the distance. However, I can move to Ghana under one and half hours and do my business, so it is better. Everybody in business is looking for profit, if you produce within your sub-region, it’s for the development of the area and when you develop the area, everybody will be happy. This will also create employment opportunities for people.

 You mentioned that there is the need to take this sensitization initiative out to people in major markets. How do you intend to do that?

We are interacting with all the federal government agencies. This is a big initiative and we have the approval of the Honourable Minister of Finance, Central Bank of Nigeria and the Minister of Industry, Trade and Investment. Now, we want to come back to our own, NSC. We had some issues in the leadership of the association in the past but that has ended and we are out to assist the government and take up a lead role to reposition the nation’s economy.

We are out to reap the benefits of the good intentions of government.  We know those who are disturbing the policies of the government such as the Nigerian Customs Service (NCS), Police, among others but gradually we are changing their mindset.

As someone of Eastern extract, looking at port business in the country and the place of eastern ports. What’s your take on the numerous problems limiting Eastern ports?

There are several factors responsible for the challenges with these ports. They include the low draft of the ports, security challenges which leads to low patronage. However, the whole problem can be summarized as the lack of political will.

Former President Obasanjo made a policy that certain goods should be sent to Onne port while others must be cleared in Lagos. There are also restrictions of certain things that should not go through the land border, but must come via the seaports. At the time, one could say Obasanjo wanted to help his people but Obasanjo has left the seat. These policies need to be reversed. We don’t have problem in Onne. It is in Calabar port that we have problems. There are certain vessels that cannot go to Calabar because of the shallow draft. This problem can be solved if the government really wants to address it. If the federal government has been unwilling to address it, what about the state government?

IMAN visited the former Governor of Cross River state, Hon. Liyel Imoke on the issue of dredging. We had a meeting that lasted for four hours when it should have been for one hour, yet the problem remained unresolved. Calabar is the next place for an Igbo man to do business, so it is imperative that we dredge the Calabar seaport. There are certain vessels that come from South Africa, China and other countries but they can only stop in Lagos. Some of them can stop at Onne but by the time they get o shores of Calabar, they cannot move because of the shallow draft. You need to transload those cargos to smaller vessels before the goods can get to Calabar.

We told him to go put somebody in the Ministry of Transport, a liaison officer that would pursue the matter. Four years is just like four months and by the time you leave, the whole programme dies. We also told him to give us a land that we are going to build. If I continue investing my money on hotels, then I am not doing an ideal business. He promised us the land but his subordinates took the land. These problems are not insurmountable but the lack of political will is the recurring decimal. If the federal government decides to dredge Calabar channel, the Igbos and other Southerners would route their businesses through that port. This would boost the economic activities in the region and dissipate the activities in Lagos which led to the perennial traffic gridlock.

Recently, a Senior Naval Officer said there are thirty-three major points that need serious manning by Naval Officers at the Eastern and Delta port region but the Navy only cover nine locations because of paucity of funds. What is the security situation in the area and what is the cost implication of providing security for goods heading to these ports?

In those days, there were several notorious points that the pirates attack the ships but now those things have reduced. On the issue of security there is no problem. Now, ships land in Onne every minute. Those stakeholders in Niger Delta have also spoken to their boys and the amnesty policy also assisted a lot. Some of them have been flown abroad for training. The boys who were in the creek fighting are now big men doing better jobs and helping their families.

Some weeks ago, the Central Bank of Nigeria (CBN) stopped forex for the importers of textile materials. What is the position of your association on that development?

Whatever you see the government doing, is usually a product for our submission to government. We submitted our memo to federal government in 2010. For example, we started the issue of moving Shippers Council to National Transport Commission (NTC). In 2010, we discussed and submitted a proposal. By the grace of God, it has been materialized but nobody knows that we did it.

On the issue of importing textiles into this country, there are so many textile factories in the country. Why must I go to China to buy textile while textile companies are laying off workers in Kaduna and Aba because of low patronage. Even when they produce, the one in China is cheaper compared to the one produced in Nigeria. So, people will have to go for the cheaper one that is produced in China.

Foreign exchange is scarce, so the things that we can produce here in the country such as tooth pick, tissue should be prohibited. Our foreign exchange should not be used to purchase such items. If we keep using our forex to purchase them, we would kill the economy and hinder the growth of such industries in the country. We would also not be able to create job opportunities. Yearly, people come out of the universities with no jobs. Several years ago, in Aba there were factories everywhere and small warehouses were producing too.

We have told the government repeatedly that the manufacturing industry cannot thrive if there is no electricity. The industry incurs too many expenses, so the government must ensure that there is a conducive environment for business.

Nobody is born an importer. No nation thrives only importation. You venture into importation because you want to be an industrialist. If I have a relationship with a Chinese, I can call him on phone and tell him that we have started producing the products in Nigeria and he will agree to partner with me. But if you don’t have a relationship with him, he would not agree. Industrialization will take place when the relationship is there.

When you industrialize, you create employment and the GDP is increased.  We urge the government to create an enabling environment while they ban these products; there is need for good roads and electricity. There is something called Transit Insurance that we do for our members. If I import and it gets to Tin Can, that is where the insurance ends. What happens if the container falls in transit from Tin Can to Anambra? If that happens the importer bears the risk. So we are calling on the federal government to institute an insurance policy so that if anything dangerous happens, we can fall back on that insurance policy.

Nigeria is the biggest market in Africa. Manufacturers are saying that the trade liberalization scheme would make Nigeria the dumping ground for other items if not properly managed. What is your opinion on this?

There are government regulatory agencies to checkmate and address such fears or concerns. However, the ETLS hasn’t been wholly adopted and supported by government agencies. Why would government put up policy and somebody will not implement it? This is a major problem in the country.

Quarantine is not supposed to be collecting money on the road but they are doing it. We have spoken to some of their directors to check what is coming in from one point to the other and issue quality certification. Rather, they will collect money and give them certificates. They are just interested in money and we have told them that it is not about money. When the right thing is done, there will be peace and everybody will be happy.

We are working with the office of the Inspector General of Police and National Security Adviser and they know what we are doing. We told them that it is not importers that are doing these things, it is in connivance with some dubious Customs officers and bank managers and we want to show it that we are not part of it. Whatever we are doing, it is within the ambit of the law. Some people are complaining about what we are doing but we have told them to go to court and we will meet them there.

We also have a task force that is moving around the nation on the issue of illegal arms. People are harassing others with illegal arms and we don’t know where they are are getting it from. Importers have been accused of bringing in these illegal arms and substandard goods into the country but it isn’t always the importer. There are agents doing a lot of things to evade tax but we aren’t involved in any of these acts.

Shippers’ Council recently introduced a registration system and several stakeholders have kicked against it because of the cost implication. What is IMAN’s position?

We don’t go about kicking against what government has said. We have the approval of major stakeholders like the Association of Nigerian Licensed Customs Agents (ANLCA), National Association of Government Approved Freight Forwarders (NAGAFF) and other freight forwarding groups to engage Shippers’ Council on this matter. For everything that you do in the ports, the end receiver is the importer and they would ultimately transfer the cost burden to the final consumer of the products or service. This money is not supposed to be paid by importers but at the end of the day, the importer will pay it. We have written to the Council on this issue and we agreed to discuss after the elections. We would hold talks soon.