Smugglers account for the importation of goods worth over N7 trillion annually into the country, the Senate disclosed on Monday, lamenting that the development is taking a negative toll on the nation’s economy.
According to the upper legislative chamber, facts show that between 2010 and 2016 about 282 vessels got missing at various ports across the country, lending credence to the assertion.
Hope Uzodinma (PDP, Imo West), Chairman, Senate Committee on Customs, Excise and Tariffs, while speaking at a one-day public hearing on smuggling in the country, indicted the handlers of the nation’s ports, saying, “The figure for goods smuggled through the sea ports is mind-boggling.”
In a bid to find solution to the problems bedeviling the sector, the committee summoned officials of the Nigerian Ports Authority (NPA) to appear before it on Thursday to explain how the ships got missing and also provide answers to more serious issue of persistent smuggling at the nation’s ports.
He disclosed that according to reports, over $15 billion or N4.35 trillion worth of goods are smuggled into the country each year through the sea ports, adding that the story is same for the nation’s international airports.
“More shocking is an aspect of the World Bank report that states that over 25 percent of the total annual revenue collected by Customs service is lost to smugglers each year,” he disclosed.
He added, “If you go by the projected revenue of the service for this year, which is approximately N600 billion, it means that the service will lose about N200 billion in revenues this year alone.
“You must then agree with me that smuggling is a serious menace to the economy and that all hands must be on deck to flush it out.
“As you know when goods are illegally brought into the country through smuggling, it is not just revenue that is lost, local industries are affected adversely and jobs are lost.
“When our markets are flooded with all manner of smuggled goods from our borders, many local industries that manufacture such goods are forced to close down,” he lamented.
Uzodinma noted that the investigation was borne out of the 8th Senate’s determination to put an end to the problem of smuggling in the country.
“For the avoidance of doubt, smuggling is a major threat to the economy. Those who may imagine that this is an exaggeration should do well to refer to a recent report of the World Bank on smuggling in Nigeria,” he said.
“The report was unequivocal in stating that an astonishing US $5 billion or N1.45 trillion worth of different goods are smuggled into Nigeria annually through Benin Republic alone. Yet this is only 15 percent of the total volume of smuggled goods through the Seme border.”
According to him, no serious parliament will sit down while smugglers are allowed to ravage the economy and deny the government huge revenue earnings owing to the malaise.
While lamenting that smuggling is fast proving to be the biggest industry in Nigeria, he said, “Primary information at our disposal will suggest that in spite of the Comprehensive Import Supervision Scheme (CISS), leakages still abound in the import-export chain.”
The Senator listed mis-invoicing, which is a form of trade based money laundering by international traders; abuse of free trade zone polices; and temporary imports permit as major areas of concerns.
He added that evidence show that unutilised Form M is used by operators for capital flight and money laundering, all of which facilitate smuggling.
Greatest Threat To The Realisation Of FG Economic Policies
Declaring the public hearing open, Senate President Bukola Saraki identified smuggling of goods into the country as the greatest threat to the realisation of the economic policies of the President Muhammadu Buhari-led government.
Saraki also berated the refusal of Comptroller General of Customs, Col. Hameed Ali (rtd), to wear Customs service uniform, adding, however, that the controversial retired Colonel could continue to wear jeans and T-shirts if only he is able to end smuggling in the country.
“To the Comptroller General of Customs, let me say on a lighter note, that once you end smuggling, even if you want to wear jeans and T-Shirt, I will move the motion that you should wear jeans and T-Shirt,” Saraki said. “But on a serious note, this issue is very important. Let us all work towards ending this menace once and for all.”
Saraki, however, warned that the economic loss arising from the activities of smugglers is hurting the nation’s economy.
“This loss in revenue is what we can no longer afford at this crucial time when the government is doing all it can to meet up with its budgetary expenditures,” he said.
“Our local producers have continued to face daunting obstacles posed by the activities of smugglers, despite government’s restrictions on importations.
“Therefore, we must exploit all avenues and investigate corrupt practices in various ministries, departments and agencies of government.
“This occasion presents us with the opportunity to unravel the facts before the public with a view to finding a permanent solution.”
Nigeria Loses N7trn To Insecurity In High Seas Annually – Dogara
Meanwhile, Yakubu Dogara, Speaker, House of Representatives, on Monday said Nigeria lost about N7 trillion annually to insecurity and revenue leakages in the waterways.
Dogara said this at a public hearing on a Bill to amend the Maritime Operations Coordinating Board Act organised by the House of Representatives.
The Bill seeks to ensure the repositioning of the board for effective control of maritime operations in Nigeria’s territorial waters and create the Maritime Security Fund.
Dogara insisted that security in Nigeria’s territorial waters must be strengthened and urged the Nigerian Navy and other relevant agencies to ensure greater collaboration to stem the tide of piracy and other coastal attacks.
He assured Nigerians that the House would embark on holistic review of extant maritime legislations with a view to halting the loss in the sector.
The speaker said, “It is even more disturbing to note that Nigeria is said to be losing about N7 trillion annually in the maritime sector due to leakages in revenue generation and insecurity in the water ways.
“Between January and March, 2016, several attacks were reported off Nigeria’s coast. This was said to involve pirates stealing cargoes of crude oil and petroleum products.
“Reports had it that no fewer than 44 ship crew members were abducted and in the first half of 2017, over 20 commercial vessels were attacked in Nigerian waters.
“The increasing level of attacks and violence in the Gulf of Guinea has given Nigeria and other countries in the sub-region very damaging and negative image.
“This is in addition to an estimated monthly loss of $1.5 billion to the country.
“As I said recently, prevalence of insecurity in our waters resulted in the loss of $1.3 billion annually to illegal unregulated fishing in West Africa alone.
“The only way to promote intra-African trade in our water ways is to ensure safety and security of navigation in our waters.
“Thus, the onus is on the Nigerian Navy to stem the tide of pirate attacks and secure our territorial waters in cooperation with other agencies of government.”
He added that in the absence of enabling laws stipulating stiff penalties and adequate funding, the Navy might not be able to perform its responsibility effectively and efficiently.
Dogara said that the importance of the maritime sector and its capacity to take Nigeria out of recession could not be undermined.
“The importance of making Nigeria’s maritime sector safe and secure cannot be over emphasised given that the bulk of our trade and commerce come through our waters.
“This will greatly boost government revenue, increase our foreign reserve and ultimately provide jobs to millions of our youths.
“Our water ways and even the Gulf of Guinea have been witnessing increasing level of piracy and kidnapping of expatriates and Nigerians alike,’’ he said.
He assured that bills that would address insecurity in the sector, especially piracy, would receive urgent passage in the House to restore order to the marine sector.
The speaker added that establishment of Maritime Security Fund would provide the Navy with needed funds to effectively discharge its sub-regional duties of patrolling the joint development zone between Sao Tome and Principe and Nigeria.
The Chief of Naval Staff, Vice Admiral Ibok Ibas, at the hearing, confirmed the recovery of over N420 billion stolen oil fund in 2016.
Ibas said that the recovery was aside from stolen oil worth N6. 7 billion destroyed in various illegal refineries between January and June, 2017.
He cited the report of study conducted by Organisation of Petroleum Exporting Countries (OPEC) data, saying estimated oil production in Nigeria plummeted by more than 25 percent in 2009, as a result of piracy and sea robbery.
He, however, reiterated Navy’s commitment toward combating criminality ranging from vandalism, kidnapping, environmental pollution, maritime terrorism, illegal bunkering and poaching.
Other anti-economic growth vices, the naval chief said, included smuggling, proliferation of arms, waste dumping and oil pollution.
He noted that such colossal loss to piracy and sea robbery was avoidable, but added that intense efforts were being made to drastically reduce the menace over the past 18 months.
Ibas said “according to the Oil Producers Trading Section (OPTS) report, annual crude oil loss due to COT for 2014 amounted to about 36,162 barrels per day”.
On his part, Chairman, House Committee on Navy, Abdussamad Dasuki, lamented that while incidences of sea piracy had reduced in other territorial waters due to effective coordination, “it is increasing in Nigeria and the Gulf of Guinea.
“This is apparently disturbing given repeated warnings by the International Maritime Bureau (IMB) that attacks by sea-borne bandits off the West African coast are on the rise in Nigeria.
“To compound the problem, the United Nations Security Council reported that Nigeria was losing about $1.5 billion monthly due to piracy and other activities,” Dasuki said.
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