N750bn goods smuggled yearly into Nigeria from Benin – World Bank

World Bank Vice-President, Afr

A report by the World Bank on the level of illegal imports into Nigeria has said that, on the average, goods worth $5bn (N750bn) are smuggled into the country from the Republic of Benin on a yearly basis.

Besides, it said up to 15 per cent of Nigeria‘s total imports are smuggled into the country through Benin.

The report, which incorporates some aspects of other West African countries‘ trade trends, said, ”There is enough evidence that over $400m or more than one quarter of the current revenues collected by the Nigerian Customs Service could be collected on top of the current revenues, if the trade restriction would be adjusted to the current practices (for a limited number of products) in the sub-region.”

The report is titled, ”How Nigeria‘s Trade Policy Facilitates Unofficial Trade and Impacts Negatively Nigeria‘s Customs Efficiency and Economy.” It was anchored by two leading experts of the World Bank, Gaël Raballand and Edmond Mjekiqi, both of the African Transport Unit.

The report, which is believed among business and commerce chieftains in the country to have formed the basis of the Federal Government‘s recent action of lifting the ban on the importation of some classes of goods into the country, stressed that opening Nigerian borders to imports would raise revenue generated by the Customs from import tariffs by as much as $400m.

Although the report admitted that there were still difficulties as regards knowing the value of unofficial trade within the West African sub-region, it said information exchange and data cross-checking had helped tremendously in revealing what the trend was, especially as regards imports in Nigeria.

The report noted, ”It remains difficult and complex to assess the magnitude of smuggling activities to Nigeria. However, by cross-checking information, using various approaches, and by using data from public officials and representatives from the private sector, it is possible for us to have a range, which is already useful to demonstrate the impact of the current (ban) trade policy.

“Officially, 13 per cent of Cotonou port traffic originates from or is destined to Nigeria. However, unofficially, 75 per cent of the containers that land at Cotonou port are estimated to be headed for Nigeria and around the same amount for bulk products.”

It added, “Based on current traffic, and if we subtract official imports data, 3.5 million tonnes would then end up in Nigeria through smuggling (since exports through Cotonou from Nigeria are negligible).

“If we assume a minimum $140,021 for a tonne of cargo, up to $5bn of cargo would be smuggled to Nigeria from Cotonou only, which represents 1/6 of Nigeria‘s total imports.”

The report, which was obtained exclusively by our correspondent in Lagos on Wednesday, said, ”While the current system itself also feeds ports‘ traffic diversion and delays in port clearance, the current restrictive trade policy and tariff differentials with neighbouring countries create strong incentives for traders and importers to smuggle goods from neighbouring countries, such as Benin, to fulfill the current demand and induce a non-compliant and non-transparent culture among traders, thus aggravating the occasional corrupt behaviour of Customs officials.”

Source:http://www.punchng.com/