Scanners, 100% examination and Nigeria Customs Service

Customs to commerce electronic cargo tracking in 2019- Ali
Comptroller-General of the Nigerian Customs Service, Hameed Ali. PHOTO CREDIT:

From all indications, what gave rise to the recent deployment of another Customs unit, known as Customs Strike Force, to the ports was the perception by the Customs high command that the resident Customs officers were not carrying out satisfactory 100% examination of containers.  The circular that sent the strike force to the ports did not mince words on this, as it is titled: “100% Examination of Cargo at the Seaports”.

Surely, the deployment of the strike force with its overwhelming powers to re-examine, seize or detain already examined containers without hindrance would have been unnecessary had the scanners at the ports been working. So also would the unease and controversy it has generated been avoided.

Apparently, the Nigeria Customs Service prefers 100% physical examination of cargoes to use of scanners. This is because instead of repairing and making the scanners it inherited from the former destination inspection providers to work, and even acquiring new ones, the agency prefers 100% physical examination while passing the buck of scanners not working elsewhere.

As the destination inspection providers –Cotecna, SGS, and Global Scan –were leaving the scene finally in June 2013, it bequeathed five scanning machines to the Nigeria Customs Service. These scanners were located in Apapa Port, Tincan Island Port, Seme and Idiroko border posts. The three scanning companies or service providers had entered into contract with the Federal Ministry of Finance for the provision, installation, operation and management of X-Ray Scanning Machines and computerized management for examination of goods on Build, Own, Operate and Transfer (BOOT) for a period of seven years, from 2006 to 2012. At the expiration of the contract, it was extended for six months, which ended in June 2013. One can also recall that the Federal Government also entered into a transition contract agreement with the service providers for transfer of the scanners to the Nigeria Customs Service (NCS). The government at the same time had constituted the Transition Implementation Committee on Destination Inspection scheme with the specific mandate to ensure a seamless transfer of functional scanners from the Service providers to Nigeria Customs Services (NCS).

It is, therefore, reprehensible that the Service would abandon the use of scanners, which had enhanced the speed of cargo clearance at the ports, and stick to 100% physical examination. Equally reproachable is attempts to shift responsibility to somewhere else.

From the foregoing, it is clear that it is Customs inherited the scanners from the service providers, and operated them till they became decrepit. Before his retirement from service, former CG of Customs, Alhaji Abdullahi Dikko, was working on acquiring new scanners, while hoping to repair the ones inherited from the service providers.

What one cannot understand is why the present Customs leadership and the Federal Ministry of Finance could not pursue the repair of the scanners in line with the Transition Implementation Committee’s recommendation. The committee had made their recommendation based on the report of Smith Detection, makers of the scanners. The manufacturers, after conducting a thorough audit of the hydro-scanning machines in all locations, including Warri, said the scanners could be returned to their original state of delivery with a cost of N769.888 million as at 2013, at the then exchange rate of N220 to the Euro. The manufacturers said they would do an ‘update’ of the scanners, that is, vital refurbishments that would return them to “as delivered state”, an upgrade that will help fight obsolescence and additional features that will bring the machines to the existing technology.

The country would have had all this at such a very low cost. Unfortunately, this proposal and recommendation were ignored. Seven years after, the progress made in cargo clearance time has been reversed, while the security of the nation has been compromised. While the scanners were working, there was effective risk profiling of imports. As the imports arrived, they were routed to scanners or to physical examination. About 80% of the cargoes were going through scanners and were leaving the ports quicker. But today, everything is subjected to 100% physical examination with its attendant delays, high demurrage payment and security compromise. Clearly, the contraband and arms and ammunition that have been coming into the country through the ports would have been intercepted if the scanners had been working.

Nevertheless, last January, the Federal Ministry of Finance disclosed that the Federal Government had acquired scanners to replace the faulty ones at the ports and border stations. According to the Minister of Finance, Hajia Zainab Ahmed, the hi-tech scanners would be deployed to the seaports and airports on Build, Own and Transfer (BOT) basis. Said the minister:

“We have bought some scanners and there are three hi-tech scanners that have been paid for but we are waiting for delivery and the first deployment will be to the major ports. We will buy more and part of the single window process is that there is going to be vendor finance, which implies that there will be a vendor that will provide scanners in all of the major seaports as well as major airports. They will run it on a Build Own and Transfer (BOT) and they will exit.”

For the border posts, she said government was considering purchasing mobile scanners and deploying them in stages to the areas of critical importance, where high revenues are expected. All this is good news to stakeholders.

Unfortunately, the Minister did not say anything about the existing faulty scanners at the ports –whether they will be refurbished or left to rot away forever. This is not surprising, however, in a nation famed for its penchant for wastage of assets and resources, a nation where no one is made to account for wastage of public assets and tax payers’ money.

Seven years after the recommendation by the manufacturers of the scanners, nothing has been done. No doubt, the cost of repairing the scanners now is so prohibitive that outright purchase of new ones becomes the preferred choice.

One thing that is clear from the government’s procurement of new scanners on build, operate and transfer basis is that the return of Destination Inspection (DI) agents or service providers to the ports is imminent. The Service providers were sent out of the ports in 2013. But with the apparent failure of the Nigeria Customs Service to run the scheme successfully, the Federal Government may have been left with no option than to bring back DI service providers. Of course, one cannot expect the operation and maintenance of the newly-acquired machines to be left in the hands of the Customs service which has proved that it prefers 100% physical examination of cargoes to the use of scanning machines.

However, government should exercise a lot of caution in the contemplated BOT arrangement with the service providers. A situation where the country will be holding the short end of the stick with every negotiation or contract agreement should not continue. But this is a topic for another day.