Monday, 3 April 2017

‘Customs responsible for 82% of ports charges’

The Nigerian Customs Service (NCS) and other government agencies account for the huge cost of doing business at the ports, Nigeria’s leading accounting firm, Akintola Williams Deloitte, has said. It stated this in an industry report titled: “Public Private Partnership (PPP) As an anchor for diversifying the Nigeria economy, which it has just published. The report, which was based on a case study of the Lagos Container Terminals Concession, lamented that Customs processes are responsible for about 82.1 per cent of the charges incurred by consignees. Akintola Williams Deloitte stated that its value chain analysis of a 20-foot container laden with cargo worth N44.42million ($100,000 equivalent) imported into Nigeria from China, revealed that about N6.5million would be required to clear and transport the container out of the port. It said of this, about N5.3million (representing 82.1 per cent) is paid to the NCS as Import Duty, Comprehensive Import Supervision Scheme (CISS), Economic Community of West African States (ECOWAS) Trade Liberalisation Scheme (ETLS), Port Development Surcharge and Value Added Tax (VAT). It listed other actors in the value chain to include shipping companies, Nigerian Ports Authority (NPA), terminal operators, clearing companies and hjaulage services providers. It said shipping companies are responsible for 13.8 per cent of the port cost (N897,000); terminal operators 1.8 per cent (N117,000); Customs 82.1 per cent (N5.3million); transporters 1.1 per cent (N71,500) and clearing agents (N78,000). According to the report, “the value chain of a typical container terminal operations, begins with the shipment of the goods through a shipping line to the host country. The consignee pays the freight charges for the shipping as well as the container deposit fees. Demurrage charges may apply where the consignee fails to return the containers on time. “Upon arrival of the container at the Nigeria port, the consignees pays terminal handling charges, storage charges, delivery charges and customs examination charges to the terminal operators. In addition, the Consignees also pay the relevant customs import duty and for logistics services to get the goods out of the terminal.” Notwithstanding their huge investment and meagre earnings, the report indicated that terminal operators still bear the burden of most of the challenges at the port. Terminal operators face huge challenges in the area of storage as the terminals are used as “cheap storage warehouse alternatives” by cargo owners. It said the current policy provides for a free three-day storage after which a charge of N900 is applied per day and regulated by the Nigerian Ports Authority (NPA), adding that importers take advantage of the low storage charges offered by the operators to store their imported goods at the terminals as opposed to a site warehousing facilities that charge as much as N60,000 per day. The report further stated that before the port reform and concession of 2006, the local port system faced major challenges which made it highly inefficient.


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