• Sunday, March 03, 2024
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BusinessDay

Cargo clearing delay worsens as Customs’ PAAR fails

Eight months into the introduction of Pre-Arrival Assessment Report (PAAR) by the Nigeria Customs Service (NCS) following the takeover of the Destination Inspection regime from the private service providers, importers say the regime has failed since they now face tougher clearing processes at the ports.

They say the introduction of PAAR, which superseded the Risk Assessment Report (RAR) formerly issued by service providers, has failed to ease the clearing bottlenecks experienced by importers.

According to them, the dwell time of cargo now averages 21 days as against minimum of 7-14 days in the last regime, causing increasing demurrage and storage charges. This, they say, has increased cost of doing business at the ports.

Lamenting the incessant querying of PAAR document by Customs officers, Emmanuel Nwabunwanne, a Lagos-based importer, says cargo clearing at the ports has become more difficult in recent times as it now takes an average of one to two weeks to get a final clearing document from Customs.

Nwabunwanne says Customs has failed to keep to the initial promise of transforming and fast-tracking cargo clearance at the ports.

BusinessDay findings reveal that importers see huge difficulties in obtaining PAAR, which is supposed to be issued before the arrival of the consignment. The importers say they sometimes spend an average of five to 14 days after the arrival of the cargo to obtain the document from Customs.

According to them, PAAR was initially designed to be the final cargo clearing document but has now been reduced to an advisory document which can be questioned or rejected by another Customs officer, thereby subjecting the importer to another fresh clearing process.

Boniface Aniebonam, an industry analyst, says non-compliance to the rule guiding PAAR by consignees is the major reason PAAR failed to alleviate the challenges confronting cargo clearance at the port, while dishonesty and under-declaration are the reasons PAAR is not adding value to the clearing process.

Reacting to this, Wale Adeniyi, national public relations officer, NCS, admits that PAAR has become an advisory document due to reoccurring errors from issuing officers.

He, however, also blames the failure on under-declaration of imports by consignees who aim to short-change government.

Another reason PAAR has failed, Adeniyi says, is lack of technical know-how on the part of some officers. He adds that an importer has the right to appeal for adjustment if the cargo is overvalued and an officer also has the right to query PAAR after carrying out physical examination of the cargo.

Manufacturers in Nigeria have also continued to pick holes at the level of capacity gaps existing in the implementation of PAAR. They say this has continued to stall delivery of raw materials to various factories, thereby disrupting production timelines.

“When imported raw materials get stuck at the ports, it results in a stock-out of raw materials, which means that the internal stock level of the manufacturers will decrease, resulting to low production levels,” says Rasheed Adegbero, immediate past acting director-general, Manufacturers Association of Nigeria (MAN), in an interview.

Similarly, manufacturing exporters are worried that the scheme crimps export capacity of their products. According to them, constant delays emanating from the scheme often lead to loss of markets for their products, as customers often have to look for alternatives in other markets rather than continue to wait for made-in-Nigerian goods which take time to arrive.

They also add that the delays result in high demurrage and consequently high production cost, thus making it difficult for locally-made goods to compete effectively in the international market.

“At the end of the day, our operating costs rise owing to the demurrage. There have been cases where such delays resulted in shortage in supplies, which prompted our customers to look for alternatives. I will also emphasise that the tariffs have been high,” a manufacturing exporter, who prefers not to be named, tells BusinessDay.

Stakeholders also say the basic problem with the scheme is capacity gaps in the areas of infrastructure, information and communication technology (ICT) and human capacity, among others, insisting that such is an indication that the NCS is not yet on top of the situation.

“The issue is that the Customs are not on top of the situation. When you have PAAR and you do not have, maybe, infrastructure, human capacity or ICT, it means there are capacity gaps in the implementation process,” says Muda Yusuf, director-general, Lagos Chamber of Commerce and Industry (LCCI), in an interview.

AMAKA ANAGOR & ODINAKA ANUDU