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Beyond Customs 2017 record N1 trillion revenue

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  • Beyond Customs 2017 record N1 trillion revenue

The Nigeria Customs Service generated a record N1.37 trillion in 2017. The feat was achieved against the background of the recession that ravaged the economy from mid-2014 until the third quarter of last year, and the foreign exchange policy that barred 41 import items from benefiting from the official window in 2016. In a statement, the NCS Public Relations Officer, Joseph Attah, explained that dogged implementation of the presidential mandate to the Comptroller-General, Hameed Ali, to restructure, reform, and raise revenue was the magic wand. The Federal Government had set N770.57 billion revenue target for it.

The NCS generated N898.67 billion in 2016 with an average exchange rate of N305.1; N903 billion in 2015 at an average exchange rate of N196.9 and N977.09bn in 2014 at a N164.6 rate. Taking the exchange rate instability into consideration, it is hard to credit the 2017 figure to any remarkable reform measures. Though the NCS had sacked 29 senior officials, among them four deputy-controllers and five assistant comptrollers, and thrown out 17 junior officers for various offences, the Service is overdue for branch and root reform.

The inadequate deployment of cutting-edge technology in its operations fuels corruption at the Apapa and Tin Can Island seaports in Lagos as well as the Port Harcourt, Warri and Calabar ports as cargoes are physically inspected, instead of using scanners. Smuggling cannot be contained under these circumstances. It also fosters delay for importers and exporters, thus making the ports unattractive for business. New scanners imported by the NCS are expected to arrive in the first quarter of this year, the Controller, Federal Operations Unit, Zone “A”, Mohammed Garba, said last October. Existing scanners had collapsed since 2014/2015. Perhaps, it is only in Nigeria this happens.

More than anything else, the NCS’s N1 trillion revenue mark exposes its underbelly. In his first meeting with the management of the service in September 2015, Ali explained that his mandate was headlined by transformation. Whatever he has done so far in line with public expectation has yet to deepen. To achieve the expected goal, high-tech or automation should define its operations. This invariably reduces the degree of physical contact that fuels graft. It was this concern, among others, that prompted Michael Ivenso, a maritime consultant, to say in 2014, “Nigeria is losing $16 billion annually for not doing what it ought to do at the ports.” It is with 100 per cent digital telecommunications network and extensive roads and rail networks that Dutch ports handle 500 million metric tons of cargoes annually. Singapore is another global model where customs operations are technology-driven.

Ali’s report card shows that the NCS needs a shot in the arm. A leadership with integrity is critical in all of the country’s revenue generating agencies. It is a fact that the Registrar of the Joint Admissions and Matriculation Board, Ishaq Oloyede, showed with the N7.8 billion his agency remitted to government coffers in 2017, as against the N3 million annually remitted by his predecessors. John Atte’s brief tenure as the Acting CGC, inadvertently revealed that corrupt officials enrich their pockets more than the Federation Account, as average monthly revenue spiked from N13 billion to N35 billion. This was after he held discussions with the area comptrollers.

Corruption in Customs blocks economic development. It has helped to kill the textiles and poultry industries as smugglers run riot. Textiles from China worth N315 billion were discovered in 75 warehouses in Kano in 2015. Similarly, Ayoola Oduntan, proprietor of Amo Farms in Oyo State, says contraband account for 75 per cent of frozen chicken in the country, to the detriment of about N2.5 billion worth of locally produced ones in cold rooms. As our seaports are compromised, the land borders are even more. Only an effective manning of them, identifying the bad eggs in Customs and showing them the way out, can bring this scourge under control.

We need to design a comprehensive strategy for the control of our borders. A presidential Task Force under Dikko’s leadership carried out a superficial reform, including the automation of goods clearing in 2009, recruited 5,000 in 2009 and 2,800 in July 2011; purchased 400 operational vehicles and reduced abuse of ECOWAS Trade Liberalisation Scheme with visits to factories in member countries to ascertain eligibility of products. The Federal Government should go the whole hog. After the terror attacks of September 11, 2001 in the United States, the government announced a new border patrol strategy. It consists of six core elements: securing the right combination of personnel, technology and infrastructure; improving mobility and rapid deployment to quickly counter and interdict based on shifts in smuggling routes and tactical intelligence; deploying defence-in-depth that makes full use of interior checkpoints and enforcement operations calculated to deny successful migration; coordinating and partnering with other law enforcement agencies to achieve set goals; improving border awareness and intelligence; and strengthening the headquarters command structure. Manning Nigeria’s porous borders and ports demands a new strategy, too.

While improved revenue collection is critical, even more is the imperative of protecting local industries so that jobs could be created for the teeming unemployed. Smugglers should be stopped in their tracks. The NCS knows all their routes. As of 2013, the textile industry had 24,000 jobs left out of the 800,000 it used to provide, a former Minister of State for Trade and Investment, Samuel Ortom, said then. But a shift from Customs’ old and warped operations is impossible without a motivated workforce. Many of its officers complain of poor remuneration. This should be addressed quickly.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Economy

Gov Emmanuel Attracts $1.4b Fertilizer Plant to Akwa Ibom

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The Governor of Akwa Ibom State, Mr. Udom Emmanuel has signed an agreement for the citing of a multi billion fertilizer plant in his State.

Governor Emmanuel was part of a Nigerian delegation led by the Minister of State for Petroleum Resources, Chief Timipre Sylva, that visited Morocco to set out the next steps of the $1.4 Bln fertilizer production plant project launched in June 2018.

The agreement between the OCP Africa, the Nigerian Sovereign Investment Authority and the Akwa Ibom State Government will birth one of the biggest investments in the fertilizer production industry worldwide.

The signing ceremony took place at the Mohammed VI Polytechnic University (UMP6).

Mr. Emmanuel signed one of the agreements of the partnership, which covers a memorandum of understanding between OCP Africa, the Akwa Ibom State in Nigeria and the NSIA on land acquisition, administrative facilitation, and common agricultural development projects in the Akwa Ibom State.

Speaking while signing the agreement, Governor Emmanuel said, “Our state is receptive to investments and we are prepared to offer the necessary support to make the project a reality.

“With a site that is suitably located to enable operational logistics and an abundance of gas resources, all that is left is for the parties to accelerate the project development process”, Mr. Udom said.

The agreement reached between the Nigerian Government and the OCP further links OCP, Mobil Producing Nigeria (MPN), the NNPC, the Gas Aggregation Company Nigeria (GACN), and the NSIA.

The two partners agreed to strengthen further their solid partnership leveraging Nigerian gas and the Moroccan phosphate.

This project will lead to a multipurpose industrial platform in Nigeria, which will use Nigerian gas and Moroccan phosphate to produce 750,000 tons of ammonia and 1 million tons of phosphate fertilizers annually by 2025.

The visit of the Nigerian delegation to Morocco takes place within the frame of the partnership sealed between OCP Group and the Nigerian Government to support and develop Nigeria’s agriculture industry.

Following the success of the first phase of Nigeria‘s Presidential Fertilizer Initiative (PFI) and the progress of the fertilizer production plant project launched in 2018 by OCP and NSIA, the Moroccan phosphates group and the Nigerian government delegation have agreed on the next steps of their joint project which is rapidly taking shape.

Several cooperation agreements were inked on Tuesday at the Mohammed VI Polytechnic University (UM6P) by OCP Africa and the Nigerian delegation. Through these deals, OCP reaffirms its unwavering support of agricultural development initiatives in Nigeria including PFI.

OCP Africa and the NSIA have agreed, inter alia, to set up a joint venture which will oversee the development of the industrial platform that will produce ammonia and fertilizers in Nigeria.

The OCP has also pledged to supply Nigerian famers with quality fertilizers adapted to the needs of their soil at competitive prices and produced locally.

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ICPC Says Nigeria Loses $10bn to Illicit Financial Flows 

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The Independent Corrupt Practices and Other Related Offences Commission (ICPC) says Nigeria accounts for 20 per cent or 10 billion dollars (N3.8 trillion) of the estimated 50 billion dollars that Africa loses to Illicit Financial Flows (IFFs).

Chairman of ICPC, Prof. Bolaji Owasanoye, said this during a virtual meeting to review a report on IFFs in relation to tax, Mrs Azuka Ogugua, spokesperson for ICPC, said in a statement released in Abuja on Friday.

The ICPC Chairman said, “the African Union Illicit Financial Flow Report estimated that Africa is losing nearly 50 billion dollars through profit shifting by multinational corporations and about 20 per cent of this figure is from Nigeria alone.”

The ICPC boss explained that taxes played “very strategic role in the nation’s political economy.”

He said the objective of the meeting was to improve on the awareness on IFFs, especially in the areas of taxation.

The ICPC boss added that the meeting would give participants the opportunity to openly discuss how to effectively use the instrumentality of taxation to curb IFFs through risk-based approach.

“Risk-based approach, that is: monitoring and audit; due process in tax collection; structured tax amnesty framework skewed in public interest; data privacy; timely resolution of audits and payment of tax refunds and intelligence sharing among revenue generating, regulatory and law enforcement agencies,” he said.

Owasanoye also stated that for the contemporary tax man to remain relevant, he must build his capacity in areas of technology management, solution architects and an astute relationship manager.

The Executive Chairman of Federal Inland Revenue Service (FIRS) Mr Muhammad Nani, expressed concerns that IFFs posed a serious threat to the Nigerian economy as the act robbed the nation of resources that were needed for development.

Nani declared that tackling IFFs would expand the country’s tax base and improve revenue generation, which was required for development.

He consequently pushed for policy reforms that would make it difficult for “capital flights” from occurring so that the country would be placed on the path of growth.

Other discussants at the event identified weak regulatory framework, opacity of financial system and lack of capacity amongst others as some of the factors that fuelled IFFs.

The discussants emphasised the need for capacity building of relevant stakeholders as one of the ways to stamp out illicit financial flows.

They commended ICPC for leveraging its corruption prevention mandate to open a new vista in IFFs discourse in Nigeria. (NAN)

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Economy

African Development Bank, Egypt Signs Agreements Worth €109 Million to Transform Sewage Coverage in Rural Areas

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The African Development Bank Group has signed financing agreements of €109 million with the Government of Egypt to improve sanitation infrastructure and services for rural communities in Luxor Governorate in Egypt’s Upper Nile region.

The financing consists of a €108 million loan from the Bank, and a grant of €1 million from the Rural Water Supply and Sanitation Initiative (RWSSI) – an Africa-wide initiative hosted by the African Development Bank.

The funding, provided in a challenging global context, will help meet the Egyptian government’s financing requirements in the light of the COVID-19 pandemic, and support a sound water and sanitation infrastructure base, a key enabler for the country’s inclusive development.

The Integrated Rural Sanitation in Upper Egypt-Luxor (IRSUE-Luxor) project is set to boost sewage coverage in the region from 6% to 55%, improving the quality of life of citizens, including women and children, who are most affected by poor sanitation.

“Promoting efficient, equitable and sustainable economic development through integrated water resources management is a priority for the Government of Egypt. The IRSUE-Luxor initiative unlocks the socio-economic development potential for inclusive and green growth,” said Rania Al-Mashat, Minister of International Cooperation, who signed the agreements on behalf of the Egyptian government.

About 22,000 households (240,000 inhabitants) will benefit from on-site and off-site facilities, through an integrated system of sewerage networks, sludge treatment and wastewater treatment plants.

IRSUE-Luxor contributes to the National Rural Sanitation Program established by the Ministry of Housing, Utilities and Urban Communities, which aims to expand nationwide access to sanitation services from 34% currently to 60% in 2030.

The project also complements the national Haya Karima (Decent Life) initiative that aims to help rural communities across Egypt access essential infrastructure services to improve their living conditions and livelihoods.

Furthermore, the project includes a staff training component to strengthen performance within the Luxor Water and Wastewater Company.

“This intervention is not just about infrastructure development. An essential part of the project is supporting ongoing sector reforms,” said Malinne Blomberg, the Bank’s Deputy Director General for North Africa.

One of several initiatives supported by the African Development Bank in Egypt to optimize the use of the country’s water resources, IRSUE-Luxor will enable about 30,000 cubic meters of treated wastewater per day to be discharged into drainage and irrigation canals and re-used to enhance agricultural output.

The initiative is in line with the Bank’s water sector policy, which promotes efficient, equitable and sustainable development through integrated water resources management. In addition, the operation supports tariff regulation to achieve full cost recovery, which is one of the basic principles of the Bank’s water sector policy.

The partnership between Egypt and the African Development Bank Group dates back more than half a century. More than 100 operations have been deployed, mobilizing more than $6 billion across multiple strategic sectors.

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