Controversy trails National Single Window over exclusion of Shippers’ Council, Customs

By Steve Agbota                                    [email protected] 

A major controversy has erupted over the recent launch of Nigeria’s National Single Window (NSW) initiative, a project heralded by President Bola Tinubu as a game-changer for the nation’s economy. Designed to streamline trade processes and reduce inefficiencies at Nigeria’s notoriously congested ports, the NSW has instead become a flashpoint for industry unrest due to the federal government’s decision to exclude the Nigerian Shippers’ Council (NSC) and the Nigeria Customs Service (NCS) from key roles in its implementation.

The omission of these two critical agencies—both with extensive expertise in trade facilitation—has raised alarms across the maritime and trade sectors. Instead, the government has designated the Federal Inland Revenue Service (FIRS) and the Nigerian Sovereign Investment Authority (NSIA) as the lead agencies for the initiative. This move has ignited widespread concern, with many experts warning that the decision could undermine the very goals the NSW was intended to achieve.

A controversial decision

The NSW was conceived as a pivotal reform to address the chronic delays, corruption, and bureaucratic red tape that plague Nigeria’s ports, which are estimated to cost the country a staggering $4 billion annually. By automating and integrating various trade processes under a single platform, the NSW was expected to enhance transparency, reduce costs, and improve the overall efficiency of trade operations in Nigeria. However, the exclusion of the NSC and NCS, agencies deeply entrenched in the intricacies of trade facilitation, has led to fears that the initiative may be doomed from the start.

Industry stakeholders have not minced words in their criticism of the federal government’s decision. Dr. Kayode Farinto, a former Acting National President of the Association of Nigerian Licensed Customs Agents (ANLCA), was particularly vocal, declaring the initiative “dead on arrival.” Farinto emphasized that in successful implementations of Single Window systems worldwide, Customs agencies are invariably at the forefront due to their specialized knowledge and experience in trade and revenue collection. “Excluding Customs from a leading role in this process is a grave mistake. The FIRS may be adept at tax collection, but trade facilitation is beyond their expertise. The NSW, under this current arrangement, is bound to fail,” he warned.

Economic implications

The stakes in this controversy are exceedingly high, especially given the dire economic consequences of Nigeria’s current port inefficiencies. The $4 billion annual loss attributed to corruption, delays, and bureaucratic hurdles at the ports represents a significant drain on the nation’s economy—one that the NSW was specifically designed to plug. However, with the NSC and NCS sidelined, many stakeholders are now questioning whether the NSW can deliver on its promises.

Dr. Eugene Nweke, a maritime expert, echoed the widespread concerns, arguing that the federal government’s decision is fundamentally flawed. He pointed out that the core objective of a Single Window system is to facilitate trade, not merely to generate revenue. “The whole essence of the National Single Window is to simplify and automate trade processes, not to turn it into a revenue-generating scheme. This move contradicts global best practices as outlined by the World Trade Organization (WTO) and the United Nations Conference on Trade and Development (UNCTAD),” Nweke remarked.

Nweke further lamented Nigeria’s declining stature in regional trade, noting that the country, once a leader in trade initiatives, now risks falling behind its neighbors. “Countries like Ghana, which once looked to Nigeria for guidance in setting up their own Single Window systems, are now far ahead in reaping the benefits. Nigeria’s failure to get this right could turn us into a regional laughingstock,” he warned.

Stakeholder backlash

The decision to place the FIRS and NSIA at the helm of the NSW has not only drawn criticism from experts but has also sparked outrage among key stakeholders in the maritime sector. Mr. Babatunde Mukaila, former National Secretary of the ANLCA, expressed his deep disappointment, accusing the government of prioritizing revenue generation over the efficiency of trade operations. “By appointing FIRS as the lead agency for the National Single Window, the government has effectively killed trade facilitation in Nigeria. This decision reveals that they care more about money than the smooth functioning of trade,” Mukaila asserted.

Mukaila also highlighted the potential chaos that could arise from this decision, pointing out that FIRS, primarily a tax agency, lacks the expertise to manage the complex trade disputes that are bound to occur with the NSW’s implementation. “It’s absurd to think that a tax agency should have the final say in critical trade matters. This will only create more bottlenecks and add to the uncertainty in the system,” he warned.

Frank Ogunojemite, President of the African Association of Professional Freight Forwarders and Logistics of Nigeria (APFFLON), was similarly critical. He questioned the wisdom of placing FIRS in charge of the NSW, noting that even with more relevant agencies involved, the system has struggled to function effectively. “If the government thinks that FIRS, an agency focused on tax collection, is better suited to manage a system designed to facilitate trade, then they are gravely mistaken,” Ogunojemite stated.

A divergence of opinions

Despite the widespread criticism, not all stakeholders are opposed to the government’s decision. Dr. Segun Musa, Deputy President of the National Association of Government Approved Freight Forwarders (NAGAFF), offered a different perspective. He suggested that a neutral agency like FIRS might actually prevent the system from being compromised by entrenched interests.

“The critical stakeholders agreed that Customs should not be the leading agency for the Single Window. In this context, the government’s decision to appoint FIRS as the lead might be the right one,” Musa stated.

However, this view remains in the minority, as the majority of stakeholders continue to voice their concerns over the exclusion of the NSC and NCS. The growing discontent has reached a boiling point, with clearing agents now preparing to escalate the issue by submitting a formal protest letter to the Minister of Finance and the Presidency. This letter is expected to outline their grievances in detail and demand the reinstatement of the NSC and NCS as lead agencies in the NSW’s implementation.

Looking ahead

As Nigeria stands at this critical juncture, the future of the National Single Window initiative hangs in the balance. The federal government faces a choice: either reconsider its approach and reintegrate the NSC and NCS into the project or proceed with a plan that many believe is destined to fail. The coming weeks will be crucial in determining whether the NSW can be salvaged and whether Nigeria can reclaim its leadership role in regional trade facilitation.

The stakes could not be higher. If the government fails to address these concerns, the National Single Window, instead of being a catalyst for economic growth, could become a symbol of yet another missed opportunity in Nigeria’s quest for modernization and efficiency in trade.