By Isaac Anumihe
World Bank’s report on the Ease of Doing Business for 2017 ranked Nigeria 169th position out of 190 countries in the world. The document indicated that Nigeria moved up by one point from 170th position for the 2016 ranking to 169th position for the 2017 ranking.
The report covers 11 indicator sets and provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the sub-national and regional levels. Details of the report reveal that Nigeria ranked 138th position in terms of starting a business, 174th position in terms of getting construction permit, 180th position in terms of getting electricity, 182nd position in terms of registering property, 44th position in terms of getting credit, 32nd position in terms of protecting minority investors, 182nd position in terms of paying taxes, 181st position in terms of trading across borders, 139th position in terms of enforcing contracts and 140th position in terms of resolving insolvency.
Following this damning report, the Federal Government set up the Presidential Enabling Business Environment Council (PEBEC) and approved a 60-day national action-plan with the aim of aiding business in the country.
The national action-plan is to be implemented across three priority areas – entry and exit of goods; entry and exit of people and government transparency and procurement – over the next 60 days to deliver tangible changes for Small and Medium Enterprises (SMEs) in Nigeria.
The Enabling Business Environment Secretariat (EBES), which became operational in October 2016 has Dr. Jumoke Oduwole, the Senior Special Assistant to the President on Industry, Trade and Investment, as its co-ordinator.
The maritime sector of the economy got the worst ranking with 182nd in terms of paying taxes or duties. Besides, the sector has the worst documentation process in the world and the worst cargo examination process in the world due to broken-down scanners.
As a result, the various government agencies do physical examination of cargoes, which is fraught with inefficiency and corruption. Other challenges include non-palletisation of goods and poorly-parked containers as well as non-stratification of cargoes before they arrive. The roads leading to the ports are the worst in the world. This also frustrates movement of cargo in and out of the ports.
In view of this, the Federal Government, through PEBEC, announced the reduction of export documentation from 10 to seven while the import documentation was slashed from 14 to eight. Other measures adopted to remove the bottlenecks in the ports, include palletisation of goods coming into Nigeria and re-introduction of scanners to facilitate cargo examination.
But a major stakeholder in the ports and National President of Association of Nigerian Licensed Customs Agents (ANLCA), Prince Olayiwole Shitu, believes that a lot more have to be done to reform the industry, saying that the reduction of the documentation is a scratch on the surface because a few documents can pass through many tables. He rather preferred online documentation, which has no human interface.
“You can have few documents and have a multitude of units that go through that same document. If it is possible for us not to have any interface at all but rather do the documentation online, I think corruption will end.
“I think the government has not got this issue right and we have gone ahead to challenge the government to set up an ombudsman to follow the clearing process from table to table before they can talk of eliminating the corruption,” he said.
On the many agencies in the ports, Shitu said that those agencies are there because of the money they extort from importers.
“This is because they are looking for cheap money. All those agencies find the port a veritable source of income. Take NAFDAC, for example. They have a budget under the Ministry of Health. When the budget is released to them and you have anything to do with them either to get a certificate or get approval to the port, you pay. And when they come to do examination, they collect money for handling charge. Those monies are not going through TSA. So, everyone is rushing to the port because they want to make money,” he explained.
However, an industry watcher and analyst, Mr. Ismail Aniemu, differed from ANLCA. He argued that the purpose of the reduction was to facilitate trade and make it competitive and reduce the incidence of extortion.
“The motive behind it is to facilitate trade and make doing business easy in Nigeria. And if you are talking about the ease of doing business in Nigeria without reducing or removing these bottlenecks, you have not started. There is a general agreement from tariff and trade that every government all over the world ought to encourage investment and encourage inflow of foreign direct investment into the economy. Nigeria cannot be an exception. Be that as it may, the government is in a good position to slash it. It is very much in line with global best practice. Nobody wants to come to trade in an economy where there are so many bottlenecks, so many cumbersome processes for businessmen. Slashing the documentation from 14 to eight is no doubt a very laudable step.
“It makes the process of doing business faster and easier. It will even, to a large extent, reduce the incidence of extortion. If you have too many documentations to process, it means you do many interface with government officials. For almost every table you go to, people will want to collect one bribe or the other from you. If you are not willing to pay, there could be some delay for not parting with your money. So, to a large extent, slashing the documentation for ease of doing business in Nigeria makes it easier for businessmen. It also facilitates trade for goods that will arrive Nigeria to exit the ports on time. The ports are not storage facilities. They are transit points. But when people have too many documentations to do for processing their imports and exports, the goods will be lying in the ports unattended to and it defeats the purpose of the ports, which is supposed to be a transit point,” he reasoned.
Recall that in order to reduce the human interface in the ports and facilitate trade in the ports, the Goodluck Jonathan administration reduced government’s agencies from eight to four. As soon as the administration’s tenure expired, those agencies rushed back to the ports to continue their extortionist practice.
Some of these agencies, which impede trade in the ports include Nigerian Police Force (NPF), Standards Organisation of Nigeria (SON), Quarantine, National Food, Drug Administration and Control (NAFDAC) and National Drug Law Enforcement Agency (NDLEA). These agencies should be invited by customs if the need arises and should not be allowed to have offices in the ports. So, apart from reducing the documentation, these agencies contribute immensely to slow trade.