Agents close shop as import volume thins down

By Foster Obi
As cargo volume at the ports continues on the downward slide, clearing agents badly hit by this unholy trend are closing shops and frantically looking for other ways to survive. While some have turned their cars to ‘kabu kabu,’ some others have resorted to doing menial jobs far away from where people would recognise them.
SHIPS&PORTS DAILY investigation shows that a large portion of them are confused and stranded as they were not prepared for this sudden reversal of fortunes. “One of them told SHIPS&PORTS DAILY “I fear for my people. You know agents now! Many of them did not go to school and it is only this job they know how to do. Now that the jobs are no longer coming, how are they going to survive? My fear is that some of them may turn to crime.’’
President of the National Council of Managing Directors of Licensed Customs Agents, Lucky Amiwero, said recently that many customs agents had lost their jobs and relocated to their hometowns. According to him, many offices have closed down and those who have not relocated cannot even afford the transport fares to come down to the ports anymore.
“This is an import-dependent country; so, the restriction of forex for the importation of 41 items by the central bank has really affected port activities. We hope the government eventually reviews the restriction. This last quarter has not been impressive”, he lamented.
Apapa Chapter spokesman of Association National Licensed Custom Agents (ANCLA)  also harped on fears that some agents may turn to crime if something is not done fast by the government. He said that the policies introduced so far by the government have been unfriendly so far. “Is it not to create hardship in the country? Are they saying that imports are much and they want to discourage it or what? Everybody knows that few people are importing now so do they want to kill the economy finally.
“I believe there is a con game going on that we don’t know. There are people that are eating from these things and this is why the regulators are not talking,” he declared.
“One thing is clear; a lot of people moving around at the ports are self-employed people who manage to renew their licenses yearly. Now there are scarcely imports and you introducing more charges. The truth is that most of these people may be forced out of the ports into crime and the country will be the worse for it. This why I believe that the government should do something fast.”
Emma Agubanze, NAGAFF Lilypond chapter chairman, said that clearing agents are badly hit by the present economic crisis and that many of them have been forced to take hard decisions to stay afloat.
“Import is still very low due to a combination of factors which has to do with the state of the economy. Forex level is still very high. At N400 per Dollar who will import at that rate. If you import where will you sell. There is also global slowdown in the economy of nations.
“What we are experiencing now is very bad. The economy is suffering as the level importation is a litmus test to the vibrancy of the economy. Our economy import driven. In the market there are no foods and to worsen the matter there is no money.
“Freight forwarding is about cargo movement from origin to destination. If there is no cargo, no shipping, no freight forwarding. Now the economy is on downward slide, cargo is down and it has affected freight forwarders badly. You don’t need to be told what the people are going through”, he declared.

Analysts have variously alerted that activities at the ports, particularly Lagos are gradually coming to a screeching halt as the foreign exchange restrictions announced last year by the Federal Government continues to put pressure on the nation’s economy. This situation they lament had made clearing agents and even some importers wasting away with no much to do and open to use by the devil.
Majority of clearing agents told SHIPS& PORTS DAILY point blank recently “We just come here daily to while away time. There is really nothing to do and the situation is getting worse and we don’t see any hope from anywhere.”
Analysts think that since clearing agents play major role at the ports, the government should find a way to reverse this ugly trend before it becomes explosive. But the danger alert is not coming from freight forwarders alone. Recently the Zonal Coordinator in charge of Zone ‘A’ of the Nigeria Customs Service, Assistant Comptroller General, Charles Edike expressed concern over the inability of commands in the Zone to realize their revenue target due to the Central Bank of Nigeria (CBN) forex restriction placed on some 41 items.
Edike said the zone contributes the largest part of the overall customs revenue but since the restriction of forex placed on the 41 items, it has significantly affected customs revenue.
“The customs revenue for this year is not doing well as we would want to and that is because of certain policies that are in place like the 41 items removed from the foreign exchange transactions. Those items would have generated revenue for customs but they have been removed from accessing forex and cannot participate in forex transactions. That is basically hampering our customs duty collection,” he said.
He explained that due to the negative impact the policy was having on Customs revenue, the Service has now shifted attention to more excisable goods such as cigarette and alcohol to generate its revenue.
The Nigerian Ports Authority in a recent report of its performance, the immediate past Managing Director, Habib Abdullahi, said the number of ocean-going vessels that called at the ports had declined by 8.1 per cent.
He said a total of 5,090 vessels “called at the ports in 2015, which is a decrease of 8.1 per cent when compared to the 5,541 recorded in 2014.”
This drop has also affected the NPA’s revenue as it generated N11.9bn in 2015, indicating a drop of 1.7 per cent from the N12.1bn generated the previous year.
Also Tin Can Island Command of the Nigeria Customs Service, one of busiest port in Nigeria reported a decline in revenue of N2.7bn for the first quarter of 2016.
The outgoing Command’s spokesman Chris Osunkwo, said, “About N58.9bn was generated in the first quarter of 2016, while N61.6bn was generated for similar period of 2015.”
Also Chairman, Shipping Association of Nigeria, Mr. Val Usifo, whose association represents the international companies handling container trade in Nigeria, said that members of the group were feeling the pressure of low imports. “All aspects of the economy are interrelated and these heavy restrictions are causing more uncertainty,” he declared.
The Comptroller-General, NCS, Hameed Ali, recently said that the entire NCS had a revenue shortfall of N230bn in the last quarter of 2015.
While stakeholders lament the hardship, there are those who praise the restrictive policy by the CBN.   Some of them said although the recent decision by the Central Bank of Nigeria (CBN) to bar banks and bureau de changes from extending foreign exchange to importers of 41 restricted items may be considered an unpopular policy by stakeholders in the import sector, it is by all intent, one of the most strategic steps so far taken by the management of the apexbank in the bid to halt the massive erosion of the nation’s foreign reserves now hovering around $29billion.
This development they noted is coming at about the same time lessons of the Eurozone countries are steering us in the face, as they were to resolve their issues with Greece over its default in repaying the $1.6billion debt owed the International Monetary Fund (IMF).
They believe that the reason for Greece’s inability to honour its obligation cannot be separated by government’s inactions in handling its prolonged economic challenges over the years, adding, ‘’Today that government is being forced to implement far more reaching policies including capital controls where citizens are now compelled to withdraw a maximum limit of 60 Euros per day to run their homes.’’



Copyright Ships & Ports Ltd. Permission to use quotations from this article is granted subject to appropriate credit given to www.shipsandports.com.ng as the source.

..