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Maritime
Friday, December 13, 2013
National Mirror www.nationalmirroronline.net
‘FG lacks political will to enforce new auto policy’ The new National Automotive Policy, which led to the imposition of 35 per cent duty on imported used vehicles has generated serious controversies. President of National Association of Government Approved Freight Forwarders (NAGAFF), Chief Eugene Nweke in this interview with FRANCIS EZEM insists that just like previous similar policies, the government does not seem to have the political will to enforce the policy as lofty despite the good intentions. Minister of Transport, Ailaji Idris Umar is two years in office, could you assess his performance? I have accessed his performance in the past and I cannot continue to do that. But be that as it may, he is a politician and like many other politicians, he has come to make one impact or the other in the areas that catch his attention. I believe he has made one impact or the other in the area that fascinated him. But in the overall, if he has made impact only in the area of the transport sector that fascinated him, the question one asks, is where is the commitment in developing the sector? That is why some of us in the past insisted that since the government has started segmenting the transport sector, we made a case for the creation of a Railway Ministry so that rail transport system will be given adequate attention. The government should not tie it to the Ministry of Transport, which is already too wide spread to cover maritime just like they succeeded in transferring road to the Federal Ministry of Works and air transport to the Ministry of Aviation and also that of pipeline to the Ministry of Petroleum Resources. The government should expand more by creating the Ministry of Maritime as presently constituted under Transport to cater for shipping and inland water transport while the Rail Ministry caters for rail transport. We have an overbloated system and until we un-bundle it, we may not be able to address the challenges inherent in the system. But it is either we unify it and have different departments or un-bundle in order to achieve result. What do you think about the cost implication of having three or four ministers? You cannot be talking about cost implications since those running the current system do not think about cost because there are currently too many agencies under the present system so the problem is not about cost. If the issue is cost, we should have one Ministry of Transport but with departments such as rail, maritime, aviation, pipeline and road under experts. Also if you are talking about cost, you also do not consider the existence of multiple agencies saddled with various functions and taxes, which can actually be unified as one. What is your take on the new automotive policy, which many believe will bring more hardship to the people and causing temporary loss of jobs? Well, I am not thinking the temporary loss of jobs or its economic implication because those should be left for students of economics but as a freight forwarder, I want to look at the new policy whether it is masses-oriented or is for the elites. I ask this question because in the last 20 years I do not know how many Nigerians that can afford
brand new cars. So if the larger percent of the people can only afford used vehicles in the different brands, then it shows that government has not really balanced the scale. It also shows that past efforts of the government through national transport policies in creating or establishing automobile firms under the MoU arrangement that under 10, 15 or 20 years, to the extent that after assembling in Nigeria that by now technology would have been transferred and that we should be boasting of made in Nigeria automobile but as at this moment, I have not seen any vehicle made in Nigeria, which 80 percent of the components are sourced locally. You now begin to ask yourself question, has such automobile policies yielded fruits in the past? Can Peugeot Nigeria sing a song of success? Can Volkswagen Nigeria tells a success story and exploit in Nigeria to the benefits of Nigerians? Can Land Rover Ibadan, Styer Bauchi, ANAMMCO Enugu say the same thing? The essence of setting up these plants was to create jobs for Nigerians. How many Nigerians are working there today? It is either that they are retrenching or downsizing. Similarly, is there any machinery put in place by the government to regulate the prices of these vehicles? What is the indices to measure the amount of waiver they have collected from the government? That is why NAGAFF said in its recent statement that it will beam its searchlight on the Federal Ministry of Finance so that we begin to take statistics of every single waiver given to importers of these brand new vehicles or any other company for that matter. Government gives revenue target to the Nigeria Customs Service, which now claims that the waiver granted stalls its ability to meet these targets. Now we are not talking about rice but vehicles, which are fast moving equipment and many of them come through unapproved routes. Do Customs have what it takes to cover the totality of the nation’s borders? Has the government equipped the service to really police these borders? Government should look at the policy again because from experience, it might be one that will trigger massive smuggling of vehicles from unapproved routes.
Nweke
That is why we have suggested that what government needed do was to introduce high duty rate on used vehicles and low tariff rate say fiver percent on brand new vehicles so that they will be cheaper in the long run. Government cannot tell us with certainty that after 15 years that we will not come back to where we are now. You will recall that Minister of Finance, Dr. Ngozi Okonjo-Iweala, when she was minister of state under Nenadi Usman imported Peugeot cars under which Peugeot 307 were given to senior officers while the 206 model was given to the junior offers. Why were those vehicles not assembled here? That is policy summersault. I quite commend the President for initiating a policy of growing the local automotive industry because that shows he is thinking. But that should be done in such a way that it does not promote smuggling and boost the economies of neighbouring African countries, who are re-positioning to take advantage of the policy because by the time the policy comes into effect next year, in three months, the volume of cargo and ship traffic especially for specialised ports like the Roll-OnRoll-Off (RORO) operation will drop and firms like the Grimaldi Group, which runs the Ports Terminal Multiservice Limited (PTML) will begin to downsize. Government imposed the National Automotive Council Levy on imported goods,
THE PORT SYSTEM SHOULD BE AUTOMATED AND THAT IS WHY WE ENCOURAGE CUSTOMS TO ACTUALISE THE SINGLE WINDOW NETWORK THAT WILL WORK SIDE BY SIDE THE TRADE HUB SO THAT EVERYBODY WILL HOOK UP TO REDUCE HUMAN CONTACT
allegedly designed to grow the local industry. More than 20 years after, has this vision has been achieved? Government is in the habit of dishing out figures and statistics. They will tell you that they have spent over N400bn on vehicle importation but they will not tell you the total amount of the two per cent NAC Levy they have been collecting over the years. Where did they invest it? Thank God President Olusegun Obasanjo cancelled it. Eight years after port concession, it still takes over 21 days to clear cargo. What is the way out? Two things are involved, first is the problem of compliance to international best practices and secondly, we need to be ICT compliant. The port system should be automated and that is why we encourage Customs to actualise the single window network that will work side by side with the trade hub so that everybody will hook up to reduce human contact. It is only when we do that that we will have efficient system because port operators should also be able to plan. There is something called port planning and spacing, which is a daily activity under port management that will give an added edge towards efficient port operations. If your ports are not planned and structured and you receive different types and sizes of cargoes, you cannot achieve efficiency. If after eight years of port reform I cannot sit in my office and track my cargo, having received the bill of laden, we have not achieved anything. 48-hour cargo clearance is achievable when we have collapsed cumbersome procedures, which is what Customs is working towards-simplified procedures. We need to collapse so many structures then create an arrangement that represents one-stop shop. That is the only way out.