Charles Nwaoguji, [email protected]
Smuggling is a global problem of enormous scale, impacting virtually every industry around the world. Nigeria is also suffering significant economic, health and safety consequences due to widespread smuggling through its borders. Small businesses, knowingly or unknowingly buy counterfeit technology or equipment, and suffer unanticipated costs in breakage, business downtime, and unenforceable warranties. Foreign investors are reluctant to invest when the return on investment of a new product is made more uncertain by unenforced intellectual property rights.
Much more worrisome is the health and safety risks that individual consumers face as they are duped into buying faulty automobile parts or unsafe medicines. Governments themselves have become victims of counterfeiters as fake repair components find their way into military aircraft and equipment.
Nigerian government had initiated steps to address smuggling and two major efforts stand out. First, the legal framework is fairly well developed in Nigeria. Second, the government has taken steps to protect consumers’ health and safety from dangerous counterfeits through significant education efforts. Despite these actions, a stud shows that smuggling rates remain high. For example, across seven industry sectors smuggled goods sales caused average sales losses to rights holders of 21.7% in 2012.1 There are multiple reasons why smuggling continues to increase in Nigeria. Conflicting government priorities, lack of adequate resources to deal with a multitude of critical issue, a lack of political will to deal with the problem and even a sense among some that smuggling is a “victimless crime.”
There is a clear consensus that the key action needed to stop the trade in smuggled goods is stronger enforcement of the existing laws and regulations.
In interview with Daily Sun, recently the National President of Nigerian Chambers of Commerce, Industry, Mines and Agriculture ( NACCIMA), Hajiya Saratu Iya Aliyu, said the local manufacturing industries have been finding it hard to dominate the local market for quite some time mainly due to price difference between locally manufactured goods and imported goods including smuggled goods.
On the basis of the experience of Nigeria, it is also anticipated that there would be an increase in smuggling through the smse route, which means loss to the national exchequer. If supply of smuggled goods increases in the local market, it would be impossible for local manufacturers to maintain their market share, resulting in heavy losses to local industrialists. Moreover, this would result in heavy losses to the government due to loss of duties and taxes, which otherwise would be collected at the import stage.
To address this issue, Mrs. Aliyu says “Nigeria authorities have to design a mechanism to prevent smuggling and to ensure the safety of their borders, Nigeria have to agreed to build a mechanism to exchange intelligence between their anti-smuggling bureaus, to strengthen customs controls at the border and to exchange information to curb illicit smuggling across the border.”
Increasing wave of insecurity
The increasing wave of insecurity in the country especially as it concerns kidnapping, herdsmen attacks on communities, ethnic and religious clashes and many more .It is particularly worrisome that these criminal activities are not abating. While acknowledging that the government and security agencies are making efforts to curtail this tide, it is pertinent that they be more strategic in their approach so that their efforts could yield the required results.
It is important to stress that this wave of insecurity is doing a lot of damage to the image of the country and the economy, as prospective investors may become discouraged to invest in the economy while local businesses continue to groan under the uncertainty created by continued insecurity in the land.
Appointment of Ministers
Timely constitution of the federal cabinet is imperative for the expeditious implementation of government programmes. It is also necessary to reduce the feeling of uncertainty in the economic management space. Prolonged delay in having a cabinet in place may undermine the confidence of investors. We advise that professionals with track records should be appointed, to technical/ sensitive ministries and key agencies. We therefore implore swift action from the president in ensuring that we do not have a reoccurrence of what happened in 2015.
Oil and gas sector
The change in leadership of the NNPCas an opportunity for the new executives to bring in fresh ideas, we are deeply concerned and worried about the slow pace of the much needed reforms in the Oil and Gas industry in general that will accelerate the much-needed growth in the Oil & Gas industry. The delay in the signing of the PIB into law is also not helping matters. We suggest that the government intensifies efforts at attracting private investments in refineries coupled with ensuring that the ongoing Turn Around Maintenance (TAM) and repair of the four refineries intended to put them back on stream to operate at their installed capacity is expeditiously completed. We also urge the President to appoint a minister of Petroleum in his new cabinet to oversee and coordinate the activities of the petroleum industry and not just a minister of state for petroleum. We advise that the president gets a seasoned technocrat with the requisite experience and knowledge of the industry to serve as the minister of petroleum as against a regular politician. We believe that the industry would grow better under a technocrat and seasoned Petroleum minister and help accelerate the growth so much needed in the Oil & Gas sector of the economy.
Apapa traffic gridlock
The recent effort of the government at removing the gridlock in the Apapa axis of Lagos State which has been imposing untold hardship and cost on businesses and making life unbearable for road users in the state. While the use of the trucks’ call-up system by the Nigerian Ports Authority has temporarily improved the traffic situation, we urge that this be sustained and followed up immediately with the provision of truck bays to keep these trucks off from blocking traffic. However, we are of the opinion that the government should address the fundamental issues that concerns the fixing of the nation’s refineries to reduce fuel importation, ensure that various fuel depots located across the country are functional and used, look for ways of ensuring that imported fuel are channelled through other ports and accelerating the rail construction project as a means of solving the gridlock issue permanently.