Long cargo dwell time, high demurrage as importers require 79 signatures to clear goods

For an importer to take delivery of his or her consignment from any of the nation’s seaports, the person requires a minimum of 79 to 100 signatures from government agencies involved in cargo clearing procedure, said a recent Corruption Risk Assessment (CRA) report released by the Independent Corrupt Practices and other related offences Commission (ICPC).

This not only results to long dwell time of cargo at the port but also leads to high demurrage and storage charges that Nigerian importers pay to shipping companies and terminal operators for not taking delivery of their consignment as at when due.

According to the report, the long list signature required for cargo clearing is one of the major reasons why the cost of doing business at Nigerian seaports has remained high seven years after the Federal Government ceded cargo handling operations to private operators.

BusinessDay findings disclosed that terminal operators and shipping companies in Nigerian ports give limited storage and demurrage free days to importers, thereby the delay from government agencies enables them to make huge profits from rent-seeking. Currently, Nigerian ports have three free storage days and five free demurrage days as against seven to 11 days that is obtainable in ports in neighbouring countries like Cotonou, Ghana and Togo.

These government agencies that include Nigeria Customs Service (NCS), Standards Organisation of Nigeria (SON), National Agency for Food, Drug Administration and Control (NAFDAC), National Drug Law Enforcement Agency (NDLEA) among others involved in cargo clearance capitalise on this to delay an importer, who refuses to part with money.

“It takes 79 signatures to process a cargo in some ports, while in other ports it takes up to 100 signatures. This shows that the cargo clearing process in Nigerian ports is not harmonised and it gives rise to corruption”, said Constantine Palicarsky, one of the consultants to the CRA study who presented the report to stakeholders recently in Lagos.

He also blamed rationalisation as one of the reasons why corruption persists at the port, adding that people rationalise corrupt practices, giving excuses why they should not be held culpable.

He, however, said that ineffective administrative practices and weak institutions are the major causes of corruption in the nation’s ports. Other causes of corruption in the system, according to the report, include: widespread poverty with over 70 percent of Nigerians living below poverty line, serious security problems and lack of independent institution where corruption occurring in the ports can be reported.

CRA study was carried out by ICPC in the six major Nigerian ports including the Lagos Port Complex (LPC), Apapa; Tin Can Island Port; Port Harcourt Port, Onne Port, Warri Port and Calabar Port as a prevention tool which interrogates processes and procedures in the port system, in conjunction with the Technical Unit on Governance and Anti-Corruption (TUGAR) and the Bureau of Public Procurement (BPP) with the support of United Nations Development Programme (UNDP).

The report, which identified huge discretionary powers enjoyed and exercised by officials of government agencies as a major source of corrupt practices at the ports, also identified lack of standard operation procedure by government agencies as a major hindrance to port operations thus giving rise to corruption in the system.

Ekpo Nta, ICPC chairman, said that the effort of his commission is aimed at battling corruption at the nation’s seaport and not to join the multitude of government agencies constituting nuisance in the cargo clearance process.