Mr Muda Yusuf is the Director General of the Lagos Chamber of Commerce and Industry (LCCI). In this interview with Anozie Egole, he highlighted some of the expectations of the Chamber in the second tenure of the President Muhammad Buhari. He also zeroed-in on perceived shortcomings of the nation’s maritime sector where LCCI members are dominant players
“The whole process of valuation needs to be streamlined so what once your cargo comes in you know how much to pay”
What are your expectations from this new administration as far as the maritime industry is concerned?
Well, the main agenda that we set for the government as far as the maritime sector is concerned is to first ensure that we have the right kind of infrastructure at our ports. Especially the issue of capacity at the ports, access roads to the ports, an infrastructure that will be able to cope with the number of cargo and shipment that will be coming into the country. We need to do something urgently; we also need to deal with the issue of developing ports outside of Lagos; Warri ports, Calabar ports and so on. So that some of the cargoes that come to Lagos maybe some of them can move directly to those ports. So investment in infrastructure to expand the capacity for us to handle more cargo is a major priority that we expect. We also would like to see that facilities also function particularly on the issue of scanners, because if in this our age we are still doing physical and manual examination of cargoes and all that, it is not befitting for a country of our status. So we need to see the use of more technology in our cargo clearing process and the scanner is a very key component of that. We would also like to see the Single Window operational. They have been talking about this Single Window for the whole part of three and half years of this administration and as we speak, it is yet to materialize.
So, it is important that we see to it that the single window materializes so that the documentation processes can be more efficient and that is very important. Then we also need to look at our policies especially our tariff policies to ensure that we don’t have a tariff policy regime that will lead to the diversion of cargoes from Nigeria to neighboring countries. Because the more we have that kind of regime, the more revenue that Customs loses, the more jobs that our people will lose at the ports and the more jobs that even the Nigerian Ports Authority and concessionaires will also lose. So as much as it is good to use tariff to protect domestics industries, we should also not raise it higher to the extent that people will be diverting cargoes to neighboring countries. I think that is another very important thing, so when we are setting tariffs it is good to set it after due consultation with the authorities and the Nigeria Customs Service, so that we know exactly what kind of tariff regime can work and what cannot work.
The same thing applies to import prohibitions; we need to look at the capacity of the country and look at our productive capacity across all sectors to determine what kind of goods that you have to put on import prohibitions and the ones you can allow. Otherwise if you impose import prohibition on goods which you don’t have the capacity to produce the consequences is that there will be so much smuggling and nothing will be achieved. So these are some of the things we are expecting from this administration.
Talking about the Eastern Ports, there is this call by the NPA for the reduction on tariffs on goods coming through those ports just to encourage importers to use them, what do you have to say about that?
I don’t think NPA is talking about tariffs on imports. I think probably they are talking about tariffs that NPA charges. It is a good incentive because you use concessionary tariffs as an incentive to move or to behave in a particular way. So in this instance, it is a question of using the tariffs to promote the spread, and be more diversified in our ways of discharging or diverting cargoes to other ports. So it a good thing I may not be able to say specifically, but we may give a discount of 20- to 30% to encourage importers to take their cargoes to eastern ports.
How do you think the issue of ports’ access roads can be addressed?
First, to decongest the place we need to ensure that our rail system works, so that all these cargoes that we are moving by roads will be moved by rail. And from the reports that we have been getting I heard that a lot have been going on to make that happen, contract for the Lagos-Ibadan dual carriage lane has been given to extend to the ports so that cargoes can be lifted directly from the ports by railways. So the issue of evacuating cargoes through the rail is a very important step that needs to be taken to address these congestions at the ports. We also need to see what we can do with our pipelines, the conditions of many of our pipelines are not good, many have been vandalized. So if we can get our pipelines to work to reduce the menace of all these tankers, we can then pump products across the country where we have depots like Ilorin, Benin amongst others. We should be able to be pumping cargoes because the best way to transport wet cargoes is by pipelines; it is the cheapest means of transportation of wet cargoes. If we are able to do that, it will also reduce the pressure and the number of tankers on the roads and then we need to also invest on the roads to ensure that they are good.
What is your take on the government’s decision to restrict textile importers from accessing forex?
It is important that for policies like this, the CBN should be working in conjunction with other ministries so that we can properly evaluate the potential impact of some of these policies on the economy. Because the economy is not just about manufacturing, the economy is about so many other sectors because these other sectors create jobs and they generate revenue to the government and that will reduce some of these social problems that we have. For the textiles, the solution to reviving the industry is not to deny those who are importing textiles forex; I think that is a very simple way of looking at it. We need to look at the textile industry and know what their problem; energy is a major problem in any textile industry. Energy accounts for between 40-50% of the cost. So, part of the reasons the textile industries are not competitive is the energy cost, it is an energy-intensive industry. So unless you solve the problem of power, you cannot get the textile industry to be competitive, it is very difficult. Then they also have challenges even with the quality of curtains, there are some quality curtains you need to get.
How has the issue of overtime cargoes been affecting your members?
Well, I don’t know much about this overtime cargoes and what has caused the problems, but what I think about overtime cargo is that people should be very professional about the way they do business. If you are importing anything there should be proper communication between yourself, the shipping company and whoever that is sending the stuff to you. So that you will know the day the cargoes will be landing, there should also be a way to monitor these things online, to know when the ship left and when it will be coming in; we should use technology to monitor and track. Thirdly, we have to be very ethical because some people will import a cargo with the hope of cutting corners and when it didn’t work, they will abandon it. If you are importing something you have to know how much the duty is because cargo cannot come in and you say you don’t have money to pay the duty. Then, there is all these arbitrary changes in duties. If that is part of the problems then the customs and the authorities should be able to check that. Because sometimes by the time you are placing the order, the duty is one thing when it lands the customs will be telling you that the duty is another. We need to streamline the valuation that customs gives to importers, because sometime the PAAR will tell you what you should pay as duty but by the time you get to customs they will begin to raise Debit Note.
So we need to streamline all these things, the whole process of valuation needs to be streamlined so what once your cargo comes in you know how much to pay.
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