It was a gathering of who is who in the private and public sector as the Lagos Chamber of Commerce and Industry (LCC) on Tuesday assembled the business community in Nigeria to discuss the impact of the land border closure by the Nigerian government on the economy, trade and business.
The event tagged, “Stakeholders Forum on Border Closure” which was put together by the LCCI with support from Centre for International Private Enterprise (CIPE) had in attention stakeholders drawn from the Manufacturing Association of Nigeria (MAN), All Farmers Association of Nigeria (AFAN), Poultry Association of Nigeria (PAN), Borderless Alliance, Nigeria Customs Service (NCS), Iyaloja General of Lagos, Chief Mrs. Folashade Tinubu-Ojo, Consul General of the Kingdom of Switzerland and many others.
Setting the ball rolling for the discussion, the President, LCCI, Mrs. Toki Mabogunje went down memory lane to recall that the Presidency ordered the closure of Nigeria’s land borders with her neighbours on August 20, 2019, to curtail the smuggling of rice, other staple products, arms and ammunitions and premium motor spirit as well as to strengthen internal security.
Mabogunje who was represented at the forum by the Vice President, LCCI, Mr. Gabriel Idahosa, while observing that the policy action has had positive and negative implications for the economy, also noted that “on positives, we have seen appreciable increase in domestic rice and poultry product production, fuel smuggling to neighbouring countries has reduced, the directive paid off for the Nigerian Customs Service as revenue generated by the agency increased to ₦1.34 trillion in 2019 from ₦1.2 trillion in 2018.”
She continued, “On the flipside, the closure of the land borders has triggered inflationary pressure through rising food prices. Food inflation continues to uptrend, hitting a record 14.7% in December 2019, which is the highest in 20 months. This policy pronouncement has also led to unplanned losses for manufacturers, especially those who export their products to neighbouring countries by road.
“Cross-border trade has been stifled as traders from neighbouring countries can no longer access Nigerian market by road. The border closure has also paralyzed commercial activities in border communities. Trade sector is currently feeling the backlash of this policy. According to official statistics, the trade sector fell into recession in the third quarter of 2019 even as its contributions to the Gross Domestic Product (GDP) dropped by 1% in the same period.”
The President who recalled that the Economic Community of West African States (ECOWAS) recently constituted a committee to assess the impact of the border closure on trade in the sub-region and make recommendations on the way forward, however stated that “this is the question this forum seeks to provide answers to, through the various contributions of our guest speakers, discussants as well as everyone present here today.”
On his part, the Comptroller General of the Nigeria Customs Service (NCS), Col. Hameed Ali (rtd.) noted that the partial closure of the border had so far curbed the smuggling of foreign rice into the country in addition to other prohibited items adding that the series of engagements between the Service and the National Rice Millers Association of Nigeria (NRMAN) since the commencement of the exercise had shown that the border closure had impacted positively on that sector.
Represented by the Zonal Coordinator, Zone A, ACG Kaycee Ekekezie, Col. Ali pointed out that NCS daily revenue collection which before the border closure ranged between N4 billion to N5 billion now ranged between N5 billion to N6 billion daily as a result of increased cargo throughput at the nation’s seaport.
He said, “This will in turn be used to build more infrastructures and develop critical sectors of the nation’s economy. The border drill has also curbed the diversion of petroleum products from Nigeria to our neighbouring countries. NNPC record shows a 30% drop in fuel consumption which means that we have been subsidizing fuel for the neighbouring countries.
“In the area of security, the ongoing exercise has recorded a great number of seizures (arms and ammunitions) and arrests that would have had grave security consequences. Other seized items include: parboiled foreign rice, kegs of vegetable oil, motorcycles, tankers and kegs of PMS, bags of fertilizers for making explosives, containers of Pangolin scales, bleaching re-agents, donkey skin, Pharmaceutical products (in milligrams above the recommended dosage), illicit drugs such as cannabis etc. So many illegal migrants have also been arrested.
“It is important to note that 95 percent of illicit drugs and weapons used for acts of terrorism and kidnapping in Nigeria come in through the land borders. However, since this partial closure, these heinous acts have been drastically reduced. In addition, the smuggling of drugs (across the border) which affects the health and wellbeings of Nigerians have equally been reduced drastically”.
He however assured that through diplomatic channels, government would continue to engage her neighbours on the need to comply with the ECOWAS Protocols on Transit Trade adding that goods that were on prohibition list to Nigeria such as used clothings, poultry products, illicit drugs and vegetable oil among others should not be exported to Nigeria by her neighbours under the cover of the ECOWAS Trade Liberalization Scheme (ETLS) protocols.
“As a result of the closure, Niger Republic circulated an order banning exportation of rice in any form to Nigeria. In addition, the National Assembly is in support of the executive directives on the border closure and the efforts of the security agencies in executing the task”, he added.
The CGC therefore called on Nigerians to be patriotic by patronizing the Nigerian made goods and agro products as this would help Nigeria in reaching self-sufficiency in local food production, create jobs and boost the economy as well while equally calling on the business community to see the ongoing border drill as an opportunity to create a conducive environment for genuine local and international businesses to thrive in the interest of national security and development.
Also speaking, the Director General of the Manufacturers Association of Nigeria (MAN), Mr. Segun Ajayi-Kadiri while appreciating the Nigeria Customs Service (NCS) on the numerous steps it had taken to curb business of smuggling, he opined that the business of smuggling had been the bane of manufacturing industry in Nigeria adding that smuggling had seen the closure of many textile industries, led to a lot of job loss and had been of serious negative impact on manufacturing.
Ajayi-Kadiri who was represented by the Director Corporate Affairs, MAN, Mr. Ambrose Oruche, maintained that in as much as MAN agreed with the issue of curbing smuggling, it felt that the border closure was not sustainable on the long term.
“For instance, most of our manufacturers that export manufacturing products to the neighbouring countries, take for instance Mali, previously take those goods out through the Niger border to Mali within seven to eight days but what happens now is that they will containerize it, take it to Lagos port and then take it Cote’ D’Ivoire and then take it Mali and that takes up to eight weeks. You will agree with me that that has cost implication on that product. You can also agree with me that we are in a globalized economy; no country is an island on its own. Mali is also importing these products for the benefit of the citizens from other countries. Now, if the product from Nigeria even though we may say we have comparative advantage of that product but cost implication becomes uncompetitive when it comes to other West African countries.
“I also want to us to agree with me here that without trade there will be no development. Trade brings development, so, we must encourage trade. What we are saying is let us find a way of controlling smuggling like other countries are doing without shutting down the border. So, what we are saying is, let us find a way of encouraging trade among ourselves. We are saying that trade among ECOWAS countries is very low 11% to 12% and then with this border closure, we bring it down to 7% and we are saying that we need it to increase. Let us trade among ourselves; this border closure will hinders us from trading among ourselves.
Adding his voice to the debate, the Trade Advisor, Borderless Alliance, Mr. Caleb Omoyiola listed the positive effects of the border closure to include; increase internal revenue of the government, increase consumption for local products, reduction in the rate of smuggling of contraband items which goes into the country such as foreign used vehicles, Tokunbo vehicles, illicit drugs, small arms and light weapons, foreign parboiled rice, foreign frozen foods, petroleum products, vegetable oil and used clothes and so on, improved internal security of the country leading to total reduction in the activities of terrorists and armed banditry since the border closure exercise, protection of domestic farmers from the cheap importation of food stuffs among others even as he submitted that Nigerian farmers were happy with the border closure because it had boost their market and provided employment in the country.
“However, there are negative effects of border closure; it has led to the breach of ECOWAS protocols, rules of integration and free movement of persons, goods and transport within the region, impact of AfCFTA – the closure of the Nigerian border goes against the spirit of the African Continental Free Trade Area agreement signed by Nigeria to promote single market among African states. AfCFTA aspires to create a continental market, free movement of persons, capital, goods and services. Nigeria defies the provisions of the AfCFTA which it committed to only a few months ago, defy regional and international trade treaties.
“Nigerian border closure demonstrate the implementation ground that continues to exist between the test of the regional and/or international trade agreement and the actual measure that some African governments have adopt, harbouring conflicts among neighbouring countries- in the course of the border closure, Ghana Union of Traders’ Association (GUTA) has started shutting down Nigerian owned businesses and Ghana officials went as far as closing 70% of businesses belonging to Nigerians in Accra, declining Nigerian products- the ECOWAS has started declining Nigerian products possibly in retaliation of the Nigerian border closure, reduction in cross border trade activities along the region, the consumer demands and private sector investment will remain weak and rise in inflation – it has resulted in rise in prices of commodities in Nigeria”, he stated.
Photo: L-R: Advisor, Borderless Alliance, Caleb Omiyiola; Chairman, Lagos Chapter, All Farmers Association of Nigeria, Shakin Agbayewa; Assistant Comptroller General, Nigeria Customs Service, Kaycee Ekekezie; Vice President, Lagos Chamber of Commerce and Industry (LCCI), Mr. Gabriel Idahosa; Director, Corporate Affairs, Manufacturers Association of Nigeria, Mr. Ambrose Oruche and Consul General of Benin Republic, Posset Didier during a Stakeholders’ Forum on Border Closure organised by the Lagos Chamber of Commerce and Industry at Commerce House, Victoria Island, Lagos.
Send your news, press releases/articles to augustinenwadinamuo@yahoo.com. Also, follow us on Twitter @ptreporters and on Facebook on facebook.com/primetimereporters or call the editor on 07030661526, 08053908817.
