As the Federal Government’s ban on the importation of vehicles through land borders took off on January 1, Nigeria is once again confronted with the consequences of a failure to properly think an important policy through.
When the ban was first announced, its intentions were clear. Along with similar prohibitions on the importation of rice, it had a threefold aim: to curb smuggling, to route legitimate imports through local ports, and to shore up indigenous industry. These goals are all in line with the overarching economic policy of enhanced domestic participation, increased local production and improved tax receipts.
The problem apparently lies in both the concept and implementation of the policy. The Buhari administration gave importers only 26 days’ notice before the policy took effect. There were no concessions, no provisos, and no exceptions. Given that this was a major alteration in existing policy, it cannot be said that enough preparatory time was given to people engaged in what was, after all, a legitimate business.
The policy’s envisaged gains simply cannot justify the disruption it is causing. Thousands of vehicles have been trapped at Seme and other transit points. Many importers claim that they had conveyed vehicles into the neighbouring countries of Togo and Benin long before the ban was announced on December 5, last year, only to find them caught on the wrong side of the border. Re-shipping them to Nigerian ports in line with the new policy will increase costs which will inevitably be passed on to final buyers. Vehicle sales and services businesses in Nigeria have been adversely affected.
Not enough consideration was given to the actual enforcement of the policy. The smuggling of vehicles has always been a criminal act, but that has not prevented thousands of vehicles from getting into the country illegally. Indeed, vehicle-smuggling has been so successfully done that the Nigeria Customs Service (NCS) has often had to resort to the ludicrous stratagem of apprehending suspect vehicles within the country, hundreds of miles from national borders. There is no guarantee that the service will record greater success now that the profitability of smuggling vehicles in through land borders has arguably become even greater.
Then there is the questionable capacity of Nigeria’s ports to handle the envisaged increase in vehicle imports in light of the new policy. The country’s ports have a notorious reputation for inefficiency and corruption which has defied a succession of reforms and costs about N1 trillion annually, according to a recent study.
Duty-payment procedures and other processes at the ports are often opaque. Smooth operations are hindered by 14 different security and regulatory agencies with overlapping functions. Access roads are badly-maintained; the infamous Apapa-Oshodi Expressway comes to mind. Such difficulties are actually the main reason why the more efficient Togolese and Beninois ports are so heavily patronised by Nigerian importers in the first place.
It would be wrong for the Federal Government to mistake stubbornness for principle and refuse to adjust a policy whose weaknesses are so plainly manifest. The vehicle land-importation ban must be re-examined with a view to minimising its weaknesses and enhancing its strengths.
A suitable period of grace should be given to bona fide importers, during which vehicles currently in neighbouring countries will be allowed in upon payment of approved customs duties. Local ports must undergo a procedural and infrastructural overhaul in order to make them more efficient and better able to cope with increased patronage; the passing of the National Transport Commission Bill and the Nigerian Ports and Harbours Authority Bill are essential in this regard. Pressure could be taken off Lagos by increasing the capability of ports in other parts of the country.
The sooner it is realised that a counterproductive policy cannot be a good policy, the better it will be for the Nigerian economy.
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