By Uzor Odigbo
The recently introduced B’Odogwu Customs Modernisation project will only land the country into more debt as previous experience achieved nothing but unnecessary filtering away of needed government funds.
This brutal insight was unveiled in a Paper presented by the Pioneer Chairman, Council for the Regulation of Freight Forwarding in Nigeria, Chief Tony Nwabunike at a National Discourse in Lagos .
Nwabunike recall Nigeria’s journey toward modernization and being the only customs broker and only freight forwarder member of the then Presidential Taskforce on ASYCUDA.
“I recall that the Nigeria Customs Service began with the Automated System for Customs Data (ASYCUDA) in the early 1990s under the auspices of the United Nations Conference on Trade and Development (UNCTAD).
“The system later evolved with the introduction of the Nigeria Integrated Customs Information System (NICIS), which was subsequently upgraded to NICIS II. Through NICIS II, the Nigeria Customs Service achieved multi-trillion-naira revenue collection and emerged as one of the most modernized customs administrations in West and Central Africa.”
The former President of ANLCA revealed that he recently came across information about the “B’Odogwu” modernization programme, which aims to replace NICIS II with a $3 billion, 20-year modernization phase.
He said: “With the existing systems in place, I question the need to plunge a resource-limited country into further debt under the guise of modernization.
“The B’Odogwu project, in my view, is unnecessary and will result in the waste of scarce resources. Even if the Nigeria Customs Service excels at revenue collection, the proposed modernization is unjustifiable as it risks squandering government earnings on unproven initiatives”.
According to him, “If we convert the $3 billion modernization cost over 20 years into naira at the current volatile exchange rate, the implications become even more worrisome. I raised my concerns during the tenure of Col Hameed Ali Rtd, as Comptroller-General of Customs, and my position remains unchanged: this proposal is unnecessarily extravagant.
“I assert, without hesitation, that we are on the brink of undertaking the most expensive customs modernization project in the world. With all due respect to differing opinions, I challenge anyone in the maritime industry to provide an example of any other country that has spent $3 billion on modernizing a single government agency—especially one that has been evolving since the 1990s”.
In retrospect, he said, “Let us look back ten years. While the Nigeria Customs Service has made strides in revenue collection, the impact is debatable. In 2014, NCS collected N977.09 billion against a target of N1.2 trillion. That figure appears larger today due to inflation, with N3.21 trillion collected in 2023.
“However, the naira-dollar exchange rate in 2014 averaged N168 to $1, while in 2024, it averages around N1,670 to $1. When adjusted for inflation, the N977 billion collected in 2014 would be equivalent to N8.35 trillion today. Thus, the so-called revenue growth is an illusion, masking the erosion of real value.”
Chief Nwabunike’s text reads thus:
“We must ask: What value does the B’Odogwu project offer that could not be achieved by upgrading NICIS II? Moreover, has any developing or developed nation earmarked such massive funds to modernize a single government agency?
“Even if we argue that the funds will not come from the government’s budget, the Nigerian government will still bear the costs over the 20-year period. Customs revenue under the Comprehensive Import Supervision Scheme (CISS) and other funds meant for productive purposes will be siphoned off.
“I have personally known the Comptroller-General of Customs, Wale Adeniyi, for over three decades as a result-oriented officer. He excelled as the Customs Public Relations Officer for many years and made significant seizures of undeclared cash during his tenure at the Murtala Muhammed International Airport Command. I hope that reason will prevail in this matter.
“Currently, many licensed customs agents are facing delays or disruptions in their operations at the ports due to the implementation of the B’Odogwu program. While the Customs Service may still collect revenue from these transactions, importers and agents will suffer income losses and higher operational costs from delays.
“The Nigerian Ports Authority (NPA), as the landlord of the port area, has set a goal to achieve full port automation by the end of 2025, in line with the International Maritime Organization (IMO) deadline. However, I have not heard any public statement from the new Managing Director on this matter. You will agree that every step counts, especially since neighboring countries are our rivals in international trade. We cannot afford to lag behind.
Nigeria still has significant work to do in streamlining its port operations to attract more business. Many Nigerian importers and shippers prefer using ports in Ghana, Togo, and Benin Republic due to faster, more efficient processes.
“It is important for Nigeria to conduct a peer review of these neighboring countries to understand why, for example, Benin Republic operates an automated port system with almost no complaints, while Nigeria continues to struggle with delays, extortion, multiple agency checks, unnecessary alerts, and other bottlenecks.
WAY FORWARD
1. Expert-Driven Port System: The federal government should allow the port system to be driven by experts. A sustainable blue economy requires robust public-private sector collaboration.
2. Technology Procurement Without Patronage: Technology procurement should not be used for political patronage or as a means to reward loyalists. Given the fragility of the economy, repeating old mistakes will not yield better results. The B’Odogwu project should be reconsidered before further implementation.
- Integration of Automation into the NSW: Port automation and technology must be integrated into the National Single Window (NSW) system with the involvement of key industry stakeholders. Training programs for port users at various stages are essential.
- Use of Non-Intrusive Technology: Scanners, drones, CCTV surveillance, and other non-intrusive technologies should be deployed without resorting to expensive and exploitative contracts.
- Inter-Ministerial Coordination: An inter-ministerial working group should be established to coordinate all port-related agencies. This group should be supervised by the Secretary to the Government of the Federation (SGF) or the Vice President to prevent resource wastage.
CONCLUSION
Nigeria is the giant of Africa in many respects, and our blue economy is a crucial area for economic diversification.
Incorporating technology into the mix presents an opportunity to accelerate our transition from a developing to a developed country. We must improve on past efforts to make the most of this opportunity.