Nigeria – Huawei, Smiths Detection, Bionica win concession for $3.1bn Customs modernisation project

The Federal Executive Council (FEC) on Wednesday ratified the $3.1 billion anticipatory approval by President Muhammadu Buhari to concession the modernisation project of the Nigerian Customs Service (NCS) to a consortium named Messers E.Customs HC Project Limited. The concession is for 20 years.

The consortium is made up of Bionica Technologies W.A. Limited, Huawei, Smiths Detection, Nuctech of China, Larsen & Toubro Group, and Paramount Group.

The Minister of Finance, Budget, and National Planning, Zainab Ahmed, while briefing State House correspondents at the end of the virtual FEC meeting presided over by President Muhammadu Buhari at the Council Chamber, Presidential Villa, Abuja on Wednesday, said the project will be at zero cost to the Federal Government since the $3.1 billion being proposed for the project will be sourced by the concessionaire.

She said, “The Minister of Finance, Budget, and National Planning presented a memo, which is for the ratification of Mr. President’s anticipatory approval for the contract for the Customs modernisation.

“The purpose of the memo we presented to Council was for a project that will enable the complete automation of the Nigeria Custom Service processes and procedures using the application and information and technology in all aspects of Customs administration in favour of a firm known as E. Customs HC Projects Nigeria Limited For a concessionary period of 20 years.

“The main objective of this project is to completely automate every aspect of the Customs business and to institutionalise the use of smart and emerging technologies that will enhance the statutory function of the Nigeria Customs Service in the areas of revenue generation as well as trade facilitation and enhancement of security. The total cost of the project is in the sum of $3.1 billion. The consortium, the PPP group that has been approved are led by Messers Y Technologies with four other members.

“The committee that led this process also looked at the National Trade Impact process that has been going on for years and confirmed that the Nigerian e-customs project is a subset of the National Trade Impact and would prefer the Nigeria Customs to play its role in the national trading platform.

“The Bionica Technologies West Africa Limited, Bargain Securities and Supplies Nigeria Limited, these are lead sponsor and co-sponsor. We also have The Africa Finance Corporation (AFC) as the lead financier and Huawei Technology as a technical service provider.

“So, the council today, ratified Mr. President’s approval for the PPP concession for a 20-year period to Messers E. Customs HC Project Limited as a concessionaire for the delivery of customs modernisation project. This is a project that will not have an immediate cost to the government, the investors are providing all of the financings and this revenue will be deployed in three phases in the concessionary period of 20 years.

“The Nigeria Customs currently has some level of automation services but it is not all of its serves that are automated. This is an end-to-end automation of all of Nigeria Customs Service processes and it’s going to bring huge value to the country. So this investment of $3.1 billion is broken down into capital investment of $1.2 billion which will be done in three phases over 36 months by these investors and $1.1 billion is our projection of the operational cost over the 20-year period of the implementation of the project.

“This project has the potential to yield up to $176 billion of revenue and the consortia that are providing this investment are going to be paid over time according to the schedule that is negotiated for their investments including their profits and cost.

“So this is the best possible way for Nigeria to roll out an important capital project using funds from the private sector and providing service for the use of Nigerian people and the government.”

Asked if with the project Customs would overtake petroleum as a source of revenue for the country, the Minister said it was part of the diversification plan of government.

According to her, “We hope that at some point those revenues from oil will begin to be insignificant compared to revenue from the non-oil sector in the Nigerian economy. That is our aspiration and that is the true meaning of diversification.”

The Minister of Information and Culture, Alhaji Lai Mohammed in his explanation said, “The key point is that it is not costing the Federal Government one thing, the $3.1 billion being proposed will be sourced by the sponsors and the partners.”

15 companies were pre-qualified and were all invited to make presentations on their solutions to enable Nigeria realise its vision of attaining complete automation of its Customs operations and enthroning best practice methods as obtained in advanced countries.

Bionica Technologies W.A. Limited was the preferred bidder after a rigorous evaluation process. Bionica presented its bid together with a consortium namely, Huawei, Smiths Detection, Nuctech of China, Larsen & Toubro Group, and Paramount Group. The Africa Finance Corporation (AFC) is both an equity investor and the Mandated Lead Arranger (MLA), which will facilitate loan syndication with foreign and local banks.

Source: Ships and Ports, September 2002

Nigeria – President cautions Customs and Port authorities over Dry Port facility

Kaduma Dry Port

On Thursday, 4 January 2018, Nigeria’s President, Muhammadu Buhari, inaugurated the Kaduna Inland Dry Port and warned the Nigeria Customs Service and port officials against frustrating the effective use of the facilities. Inaugurating the facilities in Kaduna, Buhari said the customs and the port officials must make the facilities work and not to frustrate business, commercial and industrial enterprises with unnecessary bureaucracy.

It remains for Customs and Ports officials to make these facilities work and not to frustrate business, commercial and industrial enterprises with unnecessary bureaucracy and inflicting on them delays and hardships, thereby defeating the object of the whole exercise as has happened in the past.

According to him, the hinterland business community has waited for too long for such facility that has tremendous potentials to ease the way of doing international business for the interior based importers and exporters. He said that the development of Inland Dry Ports was an important factor in the nation’s economic development efforts.

As Ports of origin for exports and ports of destination for imports, the Inland Dry Ports will accelerate the implementation of our economic diversification policy. “The concept of Inland Dry Port has gained widespread importance with the changes in international transportation as a result of the container revolution and the introduction of door-to-door delivery of cargo.

It provides importers and exporters located within the nation’s hinterland, especially industrial and commercial outfits, access to shipping and port services without necessarily visiting the seaports. “It also enables them to process clearance of their import cargo and take delivery of their raw materials and machinery close to their places of business.

President Buhari also said that the Dry Ports would provide exporters the much-needed facilities to process, package, consolidate and forward their exports to their customers all over the world without having to physically be at the seaports. According to him, this replicates the port economy in the various centres where the Dry Ports are located inland thereby generating employment and contributing to the ease of doing business.

He said in addition to the Kaduna Inland Dry Port, six other Inland Dry Ports in Ibadan, Aba, Kano, Jos, Funtua and Maiduguri, which had also been gazetted, were at various stages of completion. He congratulated the Kaduna State Government, the Federal Ministry of Transportation, Nigerian Shippers’ Council as well as the hinterland importers and exporters on the inauguration of the facilities.

The president also commended the initiative of Nigerian Shippers’ Council towards promoting the provision of these modern transport infrastructural facilities. He, however, urged the Concessionaires of the other six Dry Ports to emulate the Concessionaires of the Kaduna Dry Port by accelerating work on theirs so as to ensure speedy completion of the projects.

He said that with the full complement of the seven Dry Ports, congestion at the seaport and traffic gridlock in the port complex would be eliminated.

“Consequently, the cost of transportation and cost of doing business will be reduced,’’ he said. He lauded the efforts of the Kaduna state government for facilitating the establishment of Kaduna Inland Dry Port.

According to him, the provision of access roads and other utilities to the Dry Port by Kaduna State Government is worthy of emulation by the other Dry Ports host State Governments.

He urged relevant stakeholders across the public and private sectors, particularly Nigeria Customs Service, Nigerian Ports Authority, Nigerian Railway Corporation, Shipping Companies and Agencies, Seaport Terminal Operators, Clearing and Forwarding Agents, Road Haulers and importers and exporters to utilize the facility optimally. Source: article originally published by Vanguard (Nigeria), 4 January 2018

Customs reform in Nigeria continues after the termination of the Destination Inspection service

Secretary General Mikuriya during a courtesy visit paid to the President of the Republic of Nigeria, Mr. Goodluck Jonathan (WCO)

Secretary General Mikuriya during a courtesy visit paid to the President of the Republic of Nigeria, Mr. Goodluck Jonathan (WCO)

At the invitation of the Comptroller-General of the Nigeria Customs Service (NCS), Mr. Abdullahi Dikko Inde, the WCO Secretary General Kunio Mikuriya visited Nigeria on 17 and 18 February 2014 to observe Customs transformation activities after the termination of Destination Inspection contracts on 1 December 2013.

In Lagos, the Secretary General went to Apapa Port, Nigeria’s major port, to see Customs operations and also to visit the Customs Training Centre for a mentorship talk with young officers: the NCS has recruited many recent university graduates and trained them in computer and other necessary skills.

Secretary General Mikuriya also presided over a Stakeholder Forum to interact with the private sector. The business community were supportive of the ongoing Customs transformation programme that was enhanced by an improved communication strategy for Customs, the use of information technology – the Nigeria Trade Hub – and the implementation of modern Customs methods, such as risk management.

The private sector also suggested better use of a database for risk management purposes, including valuation, and expressed their hope for the introduction of coordinated border management and a Single Window to simplify the multiplicity of regulations and inspections at borders.

The Secretary General also travelled to Abuja, Nigeria’s capital city, and was joined by three heads of Customs from neighbouring countries, namely Benin, Ghana and Niger, who wanted to learn from NCS’s experience and obtain Nigeria’s support, as well as that of the WCO, for terminating contracts with inspection companies in order to regain ownership of core Customs functions.

The Secretary General also paid a courtesy visit to the President of the Republic, Mr. Goodluck Jonathan.  As a former Customs official early in his career, the President talked fondly of his visit to the WCO to attend the 2012 Council Sessions and particularly noted the WCO’s strong and inspirational leadership. He also acknowledged the economic and social contribution of Customs to the nation, and promised to continue to support Customs reform in Nigeria and provide guidance and influence at the regional level. Source: WCO

Finance Ministry approves transition of destination inspection service from scanning providers to Nigeria Customs Service

NigerianCustoms-BadgeThis is a landmark and very brave decision by the Nigerian Government. All countries operating Build Operate Transfer (BOT) X-ray cargo scanning services should watch this development with interest.

Following the expiration of the Destination Inspection Contract Agreements between the Federal Government of Nigeria and Scanning Service Providers (SSPs), the President, Commander in Chief of the Armed Forces has directed the transition of Destination Inspection Service from contracted SSPs to the Nigeria Customs Service.

Accordingly, effective from 1st December 2013, Nigeria Customs Service has taken over full processing of all import transactions to Nigeria in accordance with the amended Import Guidelines of the Destination Inspection Scheme. Pursuant to this, all Scanning Service Providers (Cotecna, SGS and Global Scan) shall cease to approve new Form M, issue Risk Assessment Report (RAR) or perform Scanning operations for goods imported into Nigeria.

In international trade several destination countries require Pre-shipment inspection. Pre-shipment inspection, also called preshipment inspection or PSI, is a part of supply chain management and an important and reliable quality control method for checking goods’ quality while clients buy from the suppliers.

After ordering a number of articles, the buyer lets a third party control the ordered goods before they are dispatched to him. Normally an independent inspection company is assigned with the task of the PSI, as it is in the interest of the buyer that somebody not connected with the deal in any way verifies the amount and quality. This way the buyer makes sure, he gets the goods he paid for. Wikipedia

The SSPs shall handover all valid Form Ms and existing Valuation Database to the Nigeria Customs Service. However, the contract for provision of ICT infrastructural back up for the scheme currently being executed by Webb Fontaine is extended for a period of 18 months to ensure a smooth takeover by NCS.

As we enter this era, the Federal Ministry of Finance urges stakeholders and all Nigerians to give the Comptroller General of Customs and his team all the support necessary to manage a smooth and successful takeover. While no effort was spared in the build up to this process, we should all bear it in mind that transitions of this magnitude may throw up some implementation challenges. It will require the understanding of all Stakeholders to manage whatever initial challenges that may arise before the process fully stabilizes.

As part of the take-over plans, Help Desks and Dedicated Hotlines have been provided to enable Stakeholders and the general public channel complaints, observations and suggestions on the process to the Nigeria Customs Service. Help Desks are provided at Customs Headquarters, Abuja and other Commands across the Country. Such feedback can also be channeled directly through the following dedicated numbers: 09 4621597, 09 4621598 and 09 4621599.

The Ministry will like to convey the appreciation of Mr. President and all Nigerians to the Scanning Service Providers for services rendered to the Nation since the beginning of the Destination Inspection scheme in 2006.

Source: Businessnews.com.ng

Nigerian Customs to host Single Window Feasibility Conference

Single-Window-SystemThe Nigeria Customs Service (NCS) has concluded plans to hold a conference on Single Window feasibility study findings where the national single window roadmap, implementation plan and key recommendations will be analysed.

The conference will occur in Lagos from 11 to 12 December, 2012, during which organisational, financial and cost benefit analysis for the proposed single window solution will also be analysed. The conference will address issues in areas such as business process, data harmonisation, ICT readiness of stakeholders, legislation, stakeholder relations and change management.

Feedback from all stakeholders is also expected to be collected and validated at the forum for the conclusion of the feasibility study. Furthermore, the conference is designed for policy makers, government officials, business managers, analysts, service providers, representatives of international agencies working in the field of trade facilitation, members of the academia as well as experts in trade and e-business. Source: Leadership (Abuja)