Freight Forwarders Raise Questions on 20 Years Customs Concession Contract, $176 bn Revenue Projection, E-Customs Contract
By Onyinye Apeh
Freight forwarders Tuesday demanded explanation from the Minister of Finance , Budget, Economic Planning over ongoing plans by the federal government to concession the Nigeria Customs Service (NCS) over a Public Private Partnership (PPP) arrangement and other e-customs modernization contract.
In a letter by the National Association of Government APPROVED Freight Forwarders, the Minister is being asked to provide the “applicable financial indices and parameters used in arriving at the projected revenue generation to the sum of $176 Billion?” over a 20 year period.
This according to NAGAFF in the letter signed by Dr. Eugene Nweke, was because the
Nigeria Customs makes an average of a yearly revenue of N1Trillion × 20
years = N20 Trillion.
The association said, “ However, it is not clear if the projections are monthly, yearly or daily or 20 year cumulative projection based. We will appreciate if the detail contract terms and conditions be made available to us”.
The association also demanded, “ we want to know “the condition of the one percent CISS under the present concession arrangement. Will the 1% CISS be jettisoned or upheld?
At what point should the trading public and Nigerians expect an enduring
and lasting modernization processes to enhancing process, in the Nigeria
Customs Service. Simply, when will there be an end to perennial
modernization attempts”?
The association also expressed concern about the contract on provision of scanners and demanded the Minister’s explanation.
Part of the letter reads:
“1. What Has Been The Administrative/Supervisory Roles Of Federal Ministry Of
Finance On E-Customs Modernization Process And Its Impact on The Nigeria
Customs Service & The Economy In General, Since 1996 To 2020?
Viz-a-viz:
a. In addressing the inefficiencies that bedeviled the Service in the early 70's,
Pre-Shipment Inspection Scheme introduced in 1979, later was backed up by
legal agreement via Pre-Shipment Inspection Act of 1996 aka Decree No.11
of 1996. – Pre-Shipment Inspection Companies were paid a whooping sum of
$70 million to $75 million yearly for escalating trade malpractices, while the
Service was partly paid less than N1 billion.
b. Within March to September 1999 Destination Inspection was re-introduced,
under a contractual agreement with Destination Inspection Agents (DIAs), the
essence was for a full computerization and interconnectivity of the ASYCUDA
to all stakeholders
c. On 3rd July, 1997 FMOF signed agreement with the Economic Community
of West Africa States (ECOWAS) for the installation of Asycuda in Nigeria
Customs Service Headquarters and Area Offices of Seaports, Airports & Border
Stations. The Objectives of this agreement are hinged on e-customs
modernization.
d. The Contractor/Consultant installed outdated 2.7 site instead of the 3.0 site
paid for, hence the need for upgrade to Asycuda 3.0 site.
e. 5 years after, the Asycuda agreement was not completed, out of the17
sites covered in the contract only 7 sites were installed, wherefore pursuance
to the upgrading into Asycuda 3.0, UNCTAD estimated $2,950,000:00 for its
components, and non UNCTAD components at $66,900:00. Noted that, the
completion of phase 1 of the project between 6 – 8 months at the cost of
$27,805,000:00. WAS THERE ANY SANCTION AGAINST ECOWAS?
3
f. In June, 2001, a Presidential Committee, chaired by Federal Ministry of
Finance was set up to review the Pre-shipment Inspection (PSI) Scheme, The
Committee examined the objectives and mode operations of the PSI.
g. In 2002, Government further commissioned Messrs J.C.E. CONSULTING
ASSOCIATE (CROWN AGENT) to undertake a study on the Comprehensive
Import Supervision Scheme (CISS) and Nigeria Customs Service for the
purpose of disengaging the services of Pre-shipment Inspection Agents and
enhancing revenue.
h. In June, 2002, a Specialized Technical Committee of Stakeholders was set
up to review the Pre-shipment Inspection preparatory to re-introduction of
Destination Inspection – DI.
i. In June, 2003, the Federal Government signed an agreement with Messrs
COTECNA INSPECTION SA on the provision, installation and operation of 14
X-RAY SCANNERS on Build, Operate & Transfer (BOT) BASIS , at prescribed
locations to scan all imports coming through the approved imports entry
points. The 10 year contract also included the yearly training of 50 Customs
officer on the computerized Risk Management System (CRMS), to train 500
officers within the contract period of ten years. Again, the implementation was
marred with several flaws and compromises.
Because of space consideration, the WEBB FONTAINE Contract with the
government, still on e-customs modernization to install the optic server for the
use of the Nigeria Customs Service Asycuda project will not be mentioned in
detail, due to several noticeable intricacies.
j. In December 2003, the Federal Executive Council set up a Presidential
Committee on the Implementation of Destination Inspection and Asycuda,
under the Chairmanship of the Honorable Minister of Transport.
k. In year 2012 to 2013, the Nigeria Customs Service self nurtured, developed
and commenced the Pre Arrival Assessment Report -PAAR regime, and it
received global commendations, even the World Customs Organization
attested it as a model for Africa. Subsequently, the Republic of Ghana took a
cue and adopted same model. Since then, it has been a success story; all that
was required was prompt consolidations and supervision. Today PAAR has
since been upgraded to NICIS 2.
l. On the 16th November, 2019 at the graduation ceremony of the senior
course three of the Nigeria Customs Service at the Command and Staff
College, Gwagwalada, Abuja, the CGC Col. Hameed Ali (Rtd) announced that,
the President has approved the development of electronic based Customs
4
known as e-customs. Ostensibly, implying that previous e-customs
modernization efforts inspite of the huge public fund deployed in it, is of no
recourse. There is need for a proper definition of the term, e-customs
modernization.
m. On the 20th December, 2019 the NTA reported you as saying that, the
Federal Executive Council has approved the award of $10 Billion contract to
Messrs Fore -Core Technology Solutions Limited under a PPP/ BOOT
arrangement to manage the automobile registration automation and the
issuance of exports/imports exemption certificates, under the auspices of the
Federal Ministry Of Finance, Budget & Economic Planning. The firm is
expected to earn 10% of the revenue to enable recoup its investment. We are
wondering why such Customs functions cannot be integrated nor find a place
in the NICIS 2 platform, instead of contracting it out. We think that this
singular contract seemingly casts questions on the integrity of relevance on
NICIS 2 e-Platform?
n. On the 8 th of December, 2019, the suspension of the then controversial
$300 Million Proposed contract for the e-customs modernization was reported.
The noticeable intrigues was greeted by a public outcry that trailed the
proposed contract, especially on the conflicting imputed contract values, and
integrity of the promoters of the scheme, was overwhelming.
2. What Is The Functional Interplay (Link) Between The Contract Award Sum
Of $18.12 Million & #3.255 Million To Messrs Airwave Ltd For The Acquisition
Of RAPISCAN CARGO MOBILE SCANNERS And The Concession Contract
Award Sum Of $3.1Billion To Messrs E-CUSTOMS HC PROJECT LIMITED ?
Viz-a-viz:
a. In a situation where the Federal Government will be acquiring RAPISCAN
CARGO MOBILE SCANNERS, operationally cargo scanners are integral
component of e – automation /seamless integration for customs purposes.
Since the Federal Government is acquiring RAPISCAN SCANNING MACHINES
with public funds, we care to know what is the E-CUSTOMS HC PROJECT
LIMITED be bringing to the table of reasonable value services?
b. Again, there is no attached milestone concession investment and
recoupment plans, as concessions are meant to attract foreign direct
investment (FDI). It is pertinent for us to ask, if this concession merited being
classified under the FDI status?
c. What are the applicable financial indices and parameters used in arriving at
the projected revenue generation to the sum of $176 Billion? Presently the
Nigeria Customs makes an average of a yearly revenue of N1Trillion × 20
years = N20 Trillion. However, it is not clear if the projections are monthly,
5
yearly or daily or 20 year cumulative projection based. We will appreciate if
the detail contract terms and conditions be made available to us.
3. With reference to items "a to o", we want to known:
a. The condition of the one percent CISS under the present concession
arrangement. Will the 1% CISS be jettisoned or upheld?
b. At what point should the trading public and Nigerians expect an enduring
and lasting modernization processes to enhancing process, in the Nigeria
Customs Service. Simply, when will there be an end to perennial
modernization attempts?
c. How does the FMOF reconcile the impact of financial loss in the face of
default and non performing contracts?
d. In specific terms are there evidences of sanctions or recovery for default or
non performing contracts?.
Honorable Minister, your clarification of these agitating issues, will go a long
way in setting the records straight, perhaps give rise to careful future
administrative considerations and indirectly setting standards.
Please note, our clarifications request is without prejudice, but a commitment
towards good governance, especially that which is predicted on accountability,
transparency and trust”.
We want to thank you for your attention.
Accept the assurances of our patriotic collaborations always.
Thanks.
Yours Faithfully,
DR EUGENE NWEKE RFF, KSM.
Freight forwarders Tuesday demanded explanation from the Minister of Finance , Budget, Economic Planning over ongoing plans by the federal government to concession the Nigeria Customs Service (NCS) over a Public Private Partnership (PPP) arrangement and other e-customs modernization contract.
In a letter by the National Association of Government APPROVED Freight Forwarders, the Minister is being asked to provide the “applicable financial indices and parameters used in arriving at the projected revenue generation to the sum of $176 Billion?” over a 20 year period.
This according to NAGAFF in the letter signed by Dr. Eugene Nweke, was because the
Nigeria Customs makes an average of a yearly revenue of N1Trillion × 20
years = N20 Trillion.
The association said, “ However, it is not clear if the projections are monthly, yearly or daily or 20 year cumulative projection based. We will appreciate if the detail contract terms and conditions be made available to us”.
The association also demanded, “ we want to know “the condition of the one percent CISS under the present concession arrangement. Will the 1% CISS be jettisoned or upheld?
At what point should the trading public and Nigerians expect an enduring
and lasting modernization processes to enhancing process, in the Nigeria
Customs Service. Simply, when will there be an end to perennial
modernization attempts”?
The association also expressed concern about the contract on provision of scanners and demanded the Minister’s explanation.
Part of the letter reads:
“1. What Has Been The Administrative/Supervisory Roles Of Federal Ministry Of
Finance On E-Customs Modernization Process And Its Impact on The Nigeria
Customs Service & The Economy In General, Since 1996 To 2020?
Viz-a-viz:
a. In addressing the inefficiencies that bedeviled the Service in the early 70's,
Pre-Shipment Inspection Scheme introduced in 1979, later was backed up by
legal agreement via Pre-Shipment Inspection Act of 1996 aka Decree No.11
of 1996. – Pre-Shipment Inspection Companies were paid a whooping sum of
$70 million to $75 million yearly for escalating trade malpractices, while the
Service was partly paid less than N1 billion.
b. Within March to September 1999 Destination Inspection was re-introduced,
under a contractual agreement with Destination Inspection Agents (DIAs), the
essence was for a full computerization and interconnectivity of the ASYCUDA
to all stakeholders
c. On 3rd July, 1997 FMOF signed agreement with the Economic Community
of West Africa States (ECOWAS) for the installation of Asycuda in Nigeria
Customs Service Headquarters and Area Offices of Seaports, Airports & Border
Stations. The Objectives of this agreement are hinged on e-customs
modernization.
d. The Contractor/Consultant installed outdated 2.7 site instead of the 3.0 site
paid for, hence the need for upgrade to Asycuda 3.0 site.
e. 5 years after, the Asycuda agreement was not completed, out of the17
sites covered in the contract only 7 sites were installed, wherefore pursuance
to the upgrading into Asycuda 3.0, UNCTAD estimated $2,950,000:00 for its
components, and non UNCTAD components at $66,900:00. Noted that, the
completion of phase 1 of the project between 6 – 8 months at the cost of
$27,805,000:00. WAS THERE ANY SANCTION AGAINST ECOWAS?
3
f. In June, 2001, a Presidential Committee, chaired by Federal Ministry of
Finance was set up to review the Pre-shipment Inspection (PSI) Scheme, The
Committee examined the objectives and mode operations of the PSI.
g. In 2002, Government further commissioned Messrs J.C.E. CONSULTING
ASSOCIATE (CROWN AGENT) to undertake a study on the Comprehensive
Import Supervision Scheme (CISS) and Nigeria Customs Service for the
purpose of disengaging the services of Pre-shipment Inspection Agents and
enhancing revenue.
h. In June, 2002, a Specialized Technical Committee of Stakeholders was set
up to review the Pre-shipment Inspection preparatory to re-introduction of
Destination Inspection – DI.
i. In June, 2003, the Federal Government signed an agreement with Messrs
COTECNA INSPECTION SA on the provision, installation and operation of 14
X-RAY SCANNERS on Build, Operate & Transfer (BOT) BASIS , at prescribed
locations to scan all imports coming through the approved imports entry
points. The 10 year contract also included the yearly training of 50 Customs
officer on the computerized Risk Management System (CRMS), to train 500
officers within the contract period of ten years. Again, the implementation was
marred with several flaws and compromises.
Because of space consideration, the WEBB FONTAINE Contract with the
government, still on e-customs modernization to install the optic server for the
use of the Nigeria Customs Service Asycuda project will not be mentioned in
detail, due to several noticeable intricacies.
j. In December 2003, the Federal Executive Council set up a Presidential
Committee on the Implementation of Destination Inspection and Asycuda,
under the Chairmanship of the Honorable Minister of Transport.
k. In year 2012 to 2013, the Nigeria Customs Service self nurtured, developed
and commenced the Pre Arrival Assessment Report -PAAR regime, and it
received global commendations, even the World Customs Organization
attested it as a model for Africa. Subsequently, the Republic of Ghana took a
cue and adopted same model. Since then, it has been a success story; all that
was required was prompt consolidations and supervision. Today PAAR has
since been upgraded to NICIS 2.
l. On the 16th November, 2019 at the graduation ceremony of the senior
course three of the Nigeria Customs Service at the Command and Staff
College, Gwagwalada, Abuja, the CGC Col. Hameed Ali (Rtd) announced that,
the President has approved the development of electronic based Customs
4
known as e-customs. Ostensibly, implying that previous e-customs
modernization efforts inspite of the huge public fund deployed in it, is of no
recourse. There is need for a proper definition of the term, e-customs
modernization.
m. On the 20th December, 2019 the NTA reported you as saying that, the
Federal Executive Council has approved the award of $10 Billion contract to
Messrs Fore -Core Technology Solutions Limited under a PPP/ BOOT
arrangement to manage the automobile registration automation and the
issuance of exports/imports exemption certificates, under the auspices of the
Federal Ministry Of Finance, Budget & Economic Planning. The firm is
expected to earn 10% of the revenue to enable recoup its investment. We are
wondering why such Customs functions cannot be integrated nor find a place
in the NICIS 2 platform, instead of contracting it out. We think that this
singular contract seemingly casts questions on the integrity of relevance on
NICIS 2 e-Platform?
n. On the 8 th of December, 2019, the suspension of the then controversial
$300 Million Proposed contract for the e-customs modernization was reported.
The noticeable intrigues was greeted by a public outcry that trailed the
proposed contract, especially on the conflicting imputed contract values, and
integrity of the promoters of the scheme, was overwhelming.
2. What Is The Functional Interplay (Link) Between The Contract Award Sum
Of $18.12 Million & #3.255 Million To Messrs Airwave Ltd For The Acquisition
Of RAPISCAN CARGO MOBILE SCANNERS And The Concession Contract
Award Sum Of $3.1Billion To Messrs E-CUSTOMS HC PROJECT LIMITED ?
Viz-a-viz:
a. In a situation where the Federal Government will be acquiring RAPISCAN
CARGO MOBILE SCANNERS, operationally cargo scanners are integral
component of e – automation /seamless integration for customs purposes.
Since the Federal Government is acquiring RAPISCAN SCANNING MACHINES
with public funds, we care to know what is the E-CUSTOMS HC PROJECT
LIMITED be bringing to the table of reasonable value services?
b. Again, there is no attached milestone concession investment and
recoupment plans, as concessions are meant to attract foreign direct
investment (FDI). It is pertinent for us to ask, if this concession merited being
classified under the FDI status?
c. What are the applicable financial indices and parameters used in arriving at
the projected revenue generation to the sum of $176 Billion? Presently the
Nigeria Customs makes an average of a yearly revenue of N1Trillion × 20
years = N20 Trillion. However, it is not clear if the projections are monthly,
5
yearly or daily or 20 year cumulative projection based. We will appreciate if
the detail contract terms and conditions be made available to us.
3. With reference to items "a to o", we want to known:
a. The condition of the one percent CISS under the present concession
arrangement. Will the 1% CISS be jettisoned or upheld?
b. At what point should the trading public and Nigerians expect an enduring
and lasting modernization processes to enhancing process, in the Nigeria
Customs Service. Simply, when will there be an end to perennial
modernization attempts?
c. How does the FMOF reconcile the impact of financial loss in the face of
default and non performing contracts?
d. In specific terms are there evidences of sanctions or recovery for default or
non performing contracts?.
Honorable Minister, your clarification of these agitating issues, will go a long
way in setting the records straight, perhaps give rise to careful future
administrative considerations and indirectly setting standards.
Please note, our clarifications request is without prejudice, but a commitment
towards good governance, especially that which is predicted on accountability,
transparency and trust”.
We want to thank you for your attention.
Accept the assurances of our patriotic collaborations always.
Thanks.
Yours Faithfully,
DR EUGENE NWEKE RFF, KSM.