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Clearing Agents Kick Against Increment in Shipping Fee by Grimaldi Company

PIN is usually used for imports that do not have a bill of lading




Following the reported increment in the charge of Personal Identification Number (PIN), clearing agents have condemned Grimaldi Shipping Company’s plans to charge N25,000 before importers would obtain the PIN.

Investors King  learnt that the PIN is usually used for imports that do not have a bill of lading.

In the case an importer does not have a bill of lading, a PIN would be sent from the port of origin to the importer and this would be used to clear the cargo at the port of destination in place of the original bill of lading.

Grimaldi Shipping Company, a subsidiary of Ports & Terminal Multipurpose Limited, had in a circular dated January 24, 2023, announced that the PIN release charge with effect from February 1 would be N25,000 as against about N10,000 it was being charged.

The company had said it took the decision because of rising costs of items around its business environments, saying that its customer ought to have understood the situation at hand.

Because of the hike in prices of goods, the company said it reviewed the shipping PIN charges upward.

According to Grimaldi, customers would start paying for the new charge from February 1, 2023 and that the PIN release fee would be N25,000 per bill of lading.

It said customers may continue to secure release submission of the original bill of lading, which is at no extra cost.

Aggrieved by the increment they described as outrageous, the clearing agents argued that it was not compulsory for an importer to pay for what they might not need as the charge would affect importers.

While noting that other shipping companies do not charge for PIN release as high as Grimaldi does, the agents said the new policy would not stand.

Speaking, the Deputy President of the National Association of Government Approved Freight Forwarders, Ugochukwu Nnadi, who is in charge of shipping and terminal services, said the company raised the PIN release fee from about N10,000 to N25,000.

Nnadi said other shipping companies do not charge as high as what Grimaldi issued, and urged it to reverse it.

He said the association would take further steps to press for the reversal of the PIN release fee, lamenting that the association had written the Nigerian Shippers Council and the Council for the Regulation of Freight Forwarding in Nigeria over the development, but there was no solution as at the time of this report.

He said other shipping companies charge between N7,000- N12,000 but noted that Grimladi charges as high as N25,000, which he described as unacceptable.

According to Nnadi, shipping companies do not have the right to charge for PIN release before releasing cargo.

In his remarks, a freight forwarder, Mr George Okafor, said they would keep meeting the company for it to rescind the new upward review adding that the fee was N10,000 before it was jacked up to N25,000.

A staff with Mediterranean Shipping Company, who spoke on the condition of anonymity, noted that it charge between N7,000 and N10,000 as its documentation cost.

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Increased Cost of Customs Duty, Forex Crisis Affects Used Vehicles Imports Volume in Nigeria



New vehicles

Used Vehicles auto dealers in Nigeria have expressed concern over the decline of Tokunbo car imports volume in 2022.

According to the dealers, Tokunbo car imports dropped by 47% as a result of the increased cost of customs duty and the forex crisis.

These auto dealers disclosed that the increased cost of duty on used vehicles by Nigerian customs has affected their car sales. They lamented that the import duties have also affected the number of cars they import into the country which has drastically reduced.

It would be recalled that in April 2022, the Nigerian customs announced that it would update the importation of car edition from 2017 to 2021 in compliance with the ECOWAS Common External Tariff (CET) to the 2022-2026 version in which used cars coming into Nigeria are expected to pay a 20% tariff rate and a NAC levy of 15 percent.

The NAC levy, coupled with the Value Added Tax (VAT) of 7.5 percent, results in an almost 50 percent levy that is now paid on the importation of used vehicles in Nigeria.

Speaking on the decline of the importation of used vehicles in Nigeria, regional manager of Auto Auction Mall Oluwafemi Amisu said that the increase in import duties has 100 percent played an important role in the reduction of importation of used cars into Nigeria.

He also attributed the benchmark of car models to an increase in shipping cost leading to an increase in the price of the vehicles.

Shipping companies that formerly used 2,300 vehicle capacity vessels to ship into the country have visibly downsized to 1,000 or 1,500 capacity vessels.

“Majority of transactions made by Nigerians importing vehicles are within the 08-010 model range, which typically cost N400, 000 –N600, 000 to clear. However, since 2014 has been chosen as the benchmark, clearing costs have increased to between N1 million and N1.7 million,” he added.

Also, another challenge that has been attributed to the decline of importation of used vehicles in Nigeria is the Forex crisis which auto dealers lament has affected the purchasing power of customers. They added that people now prefer to buy Nigerian used cars instead of foreign used cars, even so, Nigerian used cars have also become very expensive.

Findings by Investors King reveal that the duty rate is majorly the reason for the drop in the importation of used vehicles, as most of the vehicles coming into Nigeria are below 2013, which mandates that any auto dealer bringing any car lower than that into Nigeria will pay a duty of 2013. Due to this, most of the vehicles are reportedly passing through Cotonou Port.

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Ajay Banga Nominated as Sole Candidate for World Bank Presidency



Ajay Banga

The World Bank Group’s Board of Executive Directors has announced that Ajay Banga, a United States national, is the only nominee for the position of the next president of the bank.

This news follows US President Joe Biden’s nomination of Banga to lead the World Bank in February, citing his suitability for the role at “this critical moment in history.”

Banga, who was born in India and is a naturalized US citizen, is currently serving as vice chairman at General Atlantic and previously worked as the chief executive of Mastercard Inc. If confirmed, he would become the first-ever Indian-American to head either of the two top international financial institutions: the International Monetary Fund and the World Bank.

The World Bank’s Board of Executive Directors will now conduct a formal interview with Banga in Washington D.C., with the expectation of concluding the presidential selection in due course. The current president of the World Bank, David Malpass, is set to step down in June, nearly a year before his term is scheduled to expire, and Banga is expected to replace him.

Banga’s nomination comes at a time of increasing global economic uncertainty, with the COVID-19 pandemic exacerbating pre-existing inequalities and challenging the resilience of many countries’ financial systems. As such, the incoming World Bank president will face significant pressure to navigate the institution through these difficult times, while also addressing concerns around climate action and the role of the World Bank in promoting sustainable development.

While Banga’s nomination as the sole candidate for the position of World Bank president may come as a surprise to some, it also reflects the United States’ historical dominance in the governance of international financial institutions. However, it remains to be seen how Banga will use his position to shape the future direction of the World Bank and address the complex challenges facing the global economy.

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Company News

Unilever Nigeria to Focus on Higher Growth Opportunities by Exiting Home Care and Skin Cleansing Markets




Unilever Nigeria Plc, one of the leading Fast-Moving Consumer Goods (FMCG) companies, has announced its decision to exit the home care and skin cleansing markets.

The company disclosed that the decision would only affect three of its brands – OMO, Sunlight, and Lux. According to Unilever Nigeria, the move is aimed at accelerating the growth of the organisation and sustaining profitability.

The restructuring of Unilever Nigeria’s business model is in response to the tough business environment in Nigeria, where many organisations and individuals have found it difficult to access cash due to the Naira redesign policy of the Central Bank of Nigeria (CBN).

Unilever Nigeria’s Managing Director, Mr Carl Cruz, noted that the offloading of the home care and skin cleansing portfolios would enable the company to “concentrate on higher growth opportunities.”

Unilever Nigeria has a strong competition in the business categories it is exiting. However, the company’s products are also market leaders in the sector. Mr Cruz added that the company was repurposing its portfolio by gradually exiting two categories, home care and skin cleansing, affecting only three brands (OMO, Sunlight, and Lux).

This would allow Unilever Nigeria to drive the rest of its brand portfolio for growth into the future and strengthen business operations with measures to digitize and simplify processes.

Unilever Nigeria is a truly Nigerian business and the oldest serving manufacturer in the country. The company’s decision to exit the home care and skin cleansing markets is in line with its commitment to adapt to changing market circumstances and reposition itself to better meet the needs of its consumers, shareholders, and employees.

Mr Cruz said, “By making these changes, we will unleash the sustained and profitable growth we need to be here for the next 100 years as well.”

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