President Muhammadu Buhari has approved the engagement of a consortium of four firms to enter into a 20-year concession arrangement with the Nigeria Customs Service (NCS) and the Infrastructure Concession Regulatory Commission (ICRC) for a Customs modernisation project and establishment of digital and paperless Customs administration.
The firms include Bionica Technologies West Africa Ltd as lead sponsor, Bergman Security Consultant & Supplies Ltd as co-sponsor, Africa Finance Corporation, lead sponsor, and Huawei, lead technical service provider. The firms are to establish a project special purpose vehicle (SPV) to implement the project.
This was contained in a memo dated September 17, 2019 and signed by Abba Kyari, chief of staff to the president.
The memo with the number SH/COS/08/10/A/225, sighted by BusinessDay, was addressed to the ministers of Justice, Finance, and Budget and Planning for onward implementation.
Analysts have argued that if Customs is made to adopt automation and digital cargo clearing procedures, Nigerian ports would become efficient by reducing demurrage and storage charges paid by importers due to delay in cargo clearing.
The president through the memo also directed the ministers of Justice, Finance and Budget to finalise the concession agreement between ICRC, NCS and SPV no later than October 31, 2019.
Buhari also directed the trio to ensure that the agreement provides that the Comprehensive Import Supervision Scheme (CISS) and Nigeria Export Supervision Scheme (NESS) revenue sharing arrangement commences on a pro-rata basis against the phase one of the $300 million investment programme.
This, he said, can only take effect upon commissioning of investments, verifiable by the Central Bank of Nigeria’s letters of credit or valid import documentation, and an appropriate termination clause to be effective if the consortium is unable to reach financial close within nine months of the concession agreement being effective.
The president further directed the ministers to ensure strict performance guarantee are captured in the concession agreement.
He also directed the minister of Finance and Budget to provide monthly project implementation updates and advise on an appropriate date for the president to flag off the Customs Modernisation Project no later than November 30, 2019.
Recall that in 2015, a survey carried out by NAFITH, an international company contracted by the Nigerian Shippers Council (NSC) to study and find solutions to the perennial traffic congestion on the roads leading to the nation’s major economic gateways, Apapa and Tin-Can Island ports, said that Nigeria needs to introduce electronically powered operations at the ports to ease gridlock on the roads.
The survey, which was presented then in Lagos, said that Customs needs to introduce single window model of cargo clearance, which is currently the best practices all over the world.
“Nigerian port needs paperless Customs; e-payment of Customs duty; e-container loading list; electronic risk-based inspection; connecting other government agencies under one platform and e-permit exchange among operators,” said the survey.
It also revealed that automating cargo clearance processes will help in putting proper logistics control in place and this will ensure that only trucks that have businesses at the ports would be allowed to be within the port environment.
President Muhammadu Buhari has approved the engagement of a consortium of four firms to enter into a 20-year concession arrangement with the Nigeria Customs Service (NCS) and the Infrastructure Concession Regulatory Commission (ICRC) for a Customs modernisation project and establishment of digital and paperless Customs administration.
The firms include Bionica Technologies West Africa Ltd as lead sponsor, Bergman Security Consultant & Supplies Ltd as co-sponsor, Africa Finance Corporation, lead sponsor, and Huawei, lead technical service provider. The firms are to establish a project special purpose vehicle (SPV) to implement the project.
This was contained in a memo dated September 17, 2019 and signed by Abba Kyari, chief of staff to the president.
The memo with the number SH/COS/08/10/A/225, sighted by BusinessDay, was addressed to the ministers of Justice, Finance, and Budget and Planning for onward implementation.
Analysts have argued that if Customs is made to adopt automation and digital cargo clearing procedures, Nigerian ports would become efficient by reducing demurrage and storage charges paid by importers due to delay in cargo clearing.
The president through the memo also directed the ministers of Justice, Finance and Budget to finalise the concession agreement between ICRC, NCS and SPV no later than October 31, 2019.
Buhari also directed the trio to ensure that the agreement provides that the Comprehensive Import Supervision Scheme (CISS) and Nigeria Export Supervision Scheme (NESS) revenue sharing arrangement commences on a pro-rata basis against the phase one of the $300 million investment programme.
This, he said, can only take effect upon commissioning of investments, verifiable by the Central Bank of Nigeria’s letters of credit or valid import documentation, and an appropriate termination clause to be effective if the consortium is unable to reach financial close within nine months of the concession agreement being effective.
The president further directed the ministers to ensure strict performance guarantee are captured in the concession agreement.
He also directed the minister of Finance and Budget to provide monthly project implementation updates and advise on an appropriate date for the president to flag off the Customs Modernisation Project no later than November 30, 2019.
Recall that in 2015, a survey carried out by NAFITH, an international company contracted by the Nigerian Shippers Council (NSC) to study and find solutions to the perennial traffic congestion on the roads leading to the nation’s major economic gateways, Apapa and Tin-Can Island ports, said that Nigeria needs to introduce electronically powered operations at the ports to ease gridlock on the roads.
The survey, which was presented then in Lagos, said that Customs needs to introduce single window model of cargo clearance, which is currently the best practices all over the world.
“Nigerian port needs paperless Customs; e-payment of Customs duty; e-container loading list; electronic risk-based inspection; connecting other government agencies under one platform and e-permit exchange among operators,” said the survey.
It also revealed that automating cargo clearance processes will help in putting proper logistics control in place and this will ensure that only trucks that have businesses at the ports would be allowed to be within the port environment.
AMAKA ANAGOR-EWUZIE
