6 February 2018

Nigeria: Land Border Ban - Vehicles Importation Through Seaports Rises By 13 Percent

The federal government's ban on importation of vehicles through the land borders has started yielding positive fruits as vehicles arriving Nigeria through the nation's seaports have increased by 12.8 per cent, one year after implementation of the policy directive by the Nigerian Customs Service (NCS).

LEADERSHIP investigation shows that the seaports have become busy following the intensive enforcement of the directive which has seen the Customs Service engaging smugglers to the extent of impounding illegally imported vehicles without import duty receipts at car dealerships and all illegal routes from the borders.

The federal government had in December 2016 placed a ban on importation of vehicles through the land borders citing loss of revenue. The ban has seriously affected the operations of vehicle importers who have seen different models of their vehicles imported into the country through illegal routes being impounded.

According to data exclusively made available to LEADERSHIP by the PTML Command of the Nigeria Customs Service, Apapa, Lagos, 108, 538 vehicles were imported into the country from January - December, 2017 as against 96,222 that were imported in 2016.

A whopping 131,994 were imported in 2015 before the government implemented the 70 percent tariff on imported new vehicles and 35 percent on used vehicles. The tariff increment ‎however brought the vehicle down to 96,222 in 2016.

According to the data made available by the public relations officer of the Command, Yakubu Muhammed, all vehicles that passed through the command in 2017 was 108, 538. It was gathered that 27,083 was imported from January to March while 34,216 was imported from April to June 2017 while 47, 239 were imported from July to December 2017.

The number was 12,316 higher than what was imported in 2016 when the policy was not enacted. While 96,222 was imported through the seaport in 2016, 131,994 was imported through the nation's seaports in 2015.

Although, industry stakeholders said high import tariffs on imported used and new vehicles was one of the reasons why the policy has been slowly having effect, they noted that with the exit of Nigeria from recession, access to foreign exchange by importers and businessmen, and restoration of investors' confidence, Nigerian seaports will witness an increase of vehicles importation through the seaports.

Recall that President Goodluck Jonathan had imposed 70 percent on importation of new vehicles and 35 percent on used vehicles with the aim of boosting local production. The tariff even though it reduced the number of vehicles brought into the country, has however been slow in boosting local production but instead fuelled smuggling from neighbouring Benin Republic.

Speaking to LEADERSHIP on vehicle ban through land borders, president, Association of Nigerian Licensed Customs Agents (ANLCA), Prince Olayiwola Shittu, advised the government to reduce the tariff on brand new vehicles and maintain tariffs on used ones to boost quality and durability of vehicles brought into the country.

He said Nigeria is a victim of smuggling as so many people are bringing vehicles into the country through unapproved routes, adding that such is not good for a developing economy. "The greatest incentive is to reduce tariff on newer vehicles and increase tariff on old vehicles. If you go to West African coast, the newer your vehicle, the lower your tariff but when a brand new vehicles pays 70 percent and someone doing assemblage pay 20 percent, that is what stops people from importation.

"Also, because people are using unapproved routes to bring in their vehicles, there are no records of how many vehicles have entered into the country through those unapproved routes and that is not good for the economy. It also means that the locally assembled vehicles which government has supported so much has not impacted on the vehicles production.

"If the price of locally assembled vehicles are cheaper enough, there won't be any need of going abroad to bring in vehicles especially accidented vehicles even though it gives jobs to our local artisans but it is not good for a growing economy like ours. Government needs to have a deliberate policy on how to stop vehicles importation through the land borders," Shittu said.

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