OPINION: Presidential imports waivers: For good or bad? – Henry Boyo

Published:12 Nov, 2012

Presidential imports waivers: For good or bad? – Henry Boyo

“The bill gives significant powers to the Customs Service and ordinarily this should not be a bad thing, but it does remove powers from the President and the minister that we think are necessary to ensure that the economic agenda of the country are properly carried out as directed by the President and delegated to the minister.”

The above is an excerpt from the presentation of the Minister of Finance, Dr. Ngozi Okonjo-Iweala, at the public hearing on the proposed amendment to the Customs Act and the democratisation of the President’s powers on import duty waivers by the Senate Committee on Finance.

For the purpose of this article, we will briefly discuss the impact of waivers on industrial growth, social welfare and corruption.

Presidential import waivers are granted seemingly in pursuit of government’s altruistic economic objectives; ultimately, however, our agricultural and industrial base has often become destabilised by such waivers, as capacity utilisation in respective subsectors begin to contract with increasingly failed enterprises and rapidly rising unemployment as collaterals.  Inevitably, the abiding spectre of unemployment has instigated huge security problems, as millions of our youths become jobless and desperate.

Furthermore, selective waivers have generally transfigured markets into monopolistic scenarios.  Consequently, the usual imperfections of a monopolistic market such as price manipulation, excessive profiteering and a parasitic distribution chain would also prevail.  Ultimately, the seemingly ‘altruistic’ social objectives of Presidential waivers become defeated, as beneficiaries of waivers celebrate outrageous returns on their investments, while local industrialists struggle unsuccessfully to maintain market space.

Import waivers may also deplete government revenue; incidentally, the current Senate public hearing is coming on the heels of Nigeria’s loss of about N58.7bn (over 10 per cent of the 2012 Customs revenue budget), as a result of executive waivers this year!  Thus, projected federal revenue will consequently be further reduced by foregone corporate and personal tax revenue from failed businesses and lost employment opportunities caused by presidential imports waivers.

In the same vein, the survival of some other local industries have become jeopardised by the inexplicable lifting of the ban on importation for such consumer goods as fruit drinks, tooth picks, furniture, textiles and vehicles; i.e., those items for which local manufacturing capacity readily exists.  Indeed, the facilitation of such imports has been cited as a major avenue for dumping substandard goods in Nigeria; a development, which would inevitably further constrain industrial investments domestically.  Worse still, it is alleged that import waivers granted by previous administrations were often times used to import other fast moving products to sell rather than the specific products covered by the waiver.

Critics have suggested that such duty and levy waivers are not often driven by altruistic or patriotic objectives, but by an obligation to compensate political cronies, godfathers, associates and friends of government.  Thus, the issuance of waivers has been seen as driver of political inequities and corruption, as well as a veritable obstacle to the true practice of democracy, as the considerable slush funds derived from waiver scams are deployed to influence political patronage and election victory.

Regrettably, allegations of such impropriety with public revenue have largely remained uninvestigated by the security agencies.  Inexplicably, itinerant businessmen, often with shadowy corporate identities, have also been beneficiaries of the huge gains from import waivers; indeed, some of such ‘emergency entrepreneurs’ are alleged to have made billions of naira by simply selling their rights to the waiver to a third-party!  Incidentally, several of our nation’s business icons have at some time or the other also benefited from such waiver scams.

The 2013 budget proposals may have inadvertently, or possibly, deliberately set the stage for another waiver scam next year; the high levy and duty rates for refined sugar (20 per cent duty and 60 per cent levy) and rice (10 per cent duty and 100 per cent levy) will undoubtedly instigate huge price rises for these ‘essential’ commodities.  The intention of such high duties and levies is presumably to support the survival of local production of rice and sugar.  However, it may be unrealistic to expect the products of such investment to come on stream in the next 12 months.  The market will inevitably become under-supplied and the resultant price spiral for these ‘essential’ commodities will undoubtedly lead to a massive public outcry in an economy already severely ravaged by inflation.  As usual, government would step in and ‘altruistically’ grant waivers to its favoured partners for urgent importation of rice and sugar!

Consequently, prices would temporarily fall marginally, while cross border smuggling of rice and sugar will once again become very profitable business with the collateral of further loss of import duty revenue; worse still, government’s efforts to increase local production of rice and sugar may ultimately once again become impractical, as a result of smuggling.  In other words, as it was in the past, so will it be next year.

In the light of the foregoing, the observation of Ahmed Makarfi, Chairman of the Senate Committee on Finance, that “the powers to grant waivers should not be under the prerogative of one person” should be taken seriously.  Indeed, the view of the National Assembly, according to Markafi, is that “such power must not be exercised by any individual, except if the legislature by some legislation or resolution takes a decision about it”.

In reality, the revenue loss consequent upon covert presidential imports waivers is tantamount to robbing the federation account through the back door to bolster the fortunes of some friends of government.  In lay parlance, this is akin to hurting the people while giving away public funds without any parliamentary authority for such ‘disbursement’.

Although Dr. Okonjo-Iweala earnestly favoured the retention of waiver powers by the President and the Minister of Finance, she however, pleaded that her ministry should be represented on the proposed new Customs and Excise Board.  Incidentally, the Central Bank of Nigeria Governor, Lamido Sanusi, similarly called for the inclusion of the apex bank on the governing board of the Customs Service.

In view of the public revenue issues involved, these requests should be considered appropriate.  But it is paradoxical that these same public officers, who recognise that their representation as board members of a new Customs board would enhance transparency and accountability, would move heaven and earth to resist any attempt to accommodate such principles in their own management of public funds.  For example, the CBN obviously has no qualms about transparency and accountability of its current 12-member board with 10 CBN internal staff!

– Henry Boyo (lesleba@lesleba.com)

Related Posts

Recent Posts

Troops Recapture Northeast Border Town of Gamboru Ngala

Nigeria’s army said it recaptured the northeastern town of Gamboru Ngala, which borders Cameroon,from Boko Haram Islamist militants. “Troops are now busy with clearing and mopping up,” the army said on its Twitter account Tuesday. The Nigerian army said in July there was no area in the northeastern state of Borno that was still under the control of Boko Haram, after a regional military push. Read More: bloomberg

Presidency Reacts To PDP’s Criticisms On Buhari’s 100 Days In Office

The Presidency has advised the Peoples Democratic Party (PDP), to stop what it describes as a pathetic effort to play-down President Muhammadu Buhari’s achievements in his first 100 days in office. Reacting to the PDP statement claiming the economy is going down under the APC-led administration, the Senior Special Assistant to the President on Media and Publicity, Mallam Garba Shehu, blamed the PDP for the state of the economy. He said under the PDP administration,...

Dangote Meets Mugabe On Investment Approval

Alhaji Aliko Dangote has met with the Zimbabwean President Robert Mugabe on the need to speed up the necessary approval for his investment in power, mining and cement industries in the southern African country. Dangote who paid a courtesy call on President Mugabe reminded the President at his state House yesterday that he was awaiting the relevant approvals to set up the group’s investments. He said, “We have already decided on multimillion investments in Zimbabwe...

Boko Haram: FG Tasks Immigration Boss On Border Security

The federal government Tuesday ordered the  new Comptroller General of the Nigeria Immigration Service (NIS) Martins Kure Abechi to swiftly deploy more personnel to all air, water and land borders in the country so as to consolidate on the gains of  ongoing anti-terrorism campaigns. Permanent Secretary in the Ministry of Interior, Abubarkar Magaji conveyed this message while decorating Abechi with his new rank in Abuja.? Magaji said government would not in anyway tolerate ineffectiveness or...

Lawyer Sues Buhari Over Appointments

An Abuja-based lawyer, Dim-Udebuani Marcel, has sued President Muhammadu Buhari over recent appointments made by the president. In a suit filed on August 31, with number FHC/ABJ/CS/732/2015, Mr. Marcel accused the president of marginalizing the South East geopolitical zone, which has not received any appointment from the Buhari government yet. The president and the Federal Character Commission are joined as defendants. Mr. Marcel’s counsel, Jude Ifesemen, said the plaintiff wants the court to determine...

Adeyemi Adedokun: Road accidents, Speed Limiter Device and The Federal Road Safety Commission of Nigeria

The Federal Road Safety Corps of Nigeria (FRSC) in collaboration with the Standard Organisation of Nigeria (SON) is set to begin the enforcement of Speed Limiter Device on commercial motorists from today 1st September 2015, in an attempt to reduce road accidents in the country. The Commission confirmed during an interview that the enforcement on commercial motorists is the first phase of the process, which means it might sooner or later be...

The Secret To Losing Belly Fat

A study in the International Journal of Obesity revealed that when compared to women who cycled at a consistent pace for 40 minutes, women who worked out for 20 minutes, but alternated between eight-second sprints and 12 seconds of low-intensity cycling, lost more belly fat after 15 weeks. Work out half as long and lose more fat? Sounds good to me! You can do intervals with virtually any type of activity. Here are some ways to...

American Clerk Still Refuses To Issue Same-Sex Marriage Licenses

A county clerk in Kentucky has again refused to issue marriage licenses to gay couples, invoking her religious beliefs and God's authority, this time in defiance of a U.S. Supreme Court ruling against her. On Tuesday morning, Rowan County Clerk Kim Davis' office denied the licenses to at least two couples. At first, Davis was in her office with the door closed and blinds drawn. But she emerged a few minutes later, telling the couples...

Real Madrid: We Did Everything Necessary In De Gea Transfer From Man Utd

The Spanish outfit has stated that they did as much as they possibly could to sign the goalkeeper before the national deadline closed on Monday. Real Madrid have claimed they did everything possible to sign goalkeeper David de Gea from Manchester United. The £29 million deal to sign the Spain international would have seen Keylor Navas go in the opposite direction for around £10m, but the necessary paperwork was not completed before Monday's midnight CET deadline. In...

Nigeria Must Not Miss Polio Free Certification In 2017- Buhari

President Muhammadu Buhari yesterday warned that nothing must stop Nigeria from being certified polio-free by World Health Organization (WHO) in 2017. He has ordered the agencies involved to increase tempo of the fight against the virus. He gave the order at the Council Chamber of the State House, Abuja while receiving polio high level advocacy team. The Permanent Secretary, Federal Ministry of Health, Linus Awute?, told State House correspondents at the end of the closed-door meeting, that “the President...

El-Rufai Raises Alarm About Fraudsters Impersonating Him

The Kaduna State Governor, Nasir el-Rufai, on Monday raised the alarm that fraudsters are using his name to defraud job seekers in the state. The Governor warned those applying for employment in the State Civil Service or contracts to be wary of such unscrupulous elements. In a statement he issued through his Special Assistant on Media and Publicity, Samuel Aruwan, Governor El-Rufai said that security agencies were on the trail of the fraudsters. According...

White House Responds To Kanye West’s Presidential Bid

A representative from the White House has responded to Kanye West's recent announcement that he will run to be the US President in 2020. Responding to West's statement of intent, White House Press Secretary Josh Earnest told Billboard that he looks "forward to seeing what slogan he chooses to embroider on his campaign hat". The news follows West's recent backing of Hillary Clinton for the Democratic nomination for the 2016 Presidential campaign. Read More: nme

Video: Runtown Ft. Wizkid – Bend Down Pause

Here comes the official video to the trending single titled “Bend Down” by Eric Manny frontman “Runtown” featuring starboy “Wizkid” and (Major Lazer). The Video was shot in malibu by “Jay Will” Watch, Download & enjoy!!! Watch “Bend Down Pause (Official Music Video) – Runtown ft. Wizkid & Major Lazer” https://youtu.be/ovhX7LUzhPs

Court Grants Dasuki Bail On Self Recognition

A Federal High Court, Abuja, on Tuesday granted bail to former National Security Adviser (NSA), retired Col. Mohammed Sambo Dasuki, arraigned before the court for illegal possession of firearms. The News Agency of Nigeria (NAN) reports that Justice Adeniyi Ademola granted Dasuki bail on self-recognition, after he pleaded not guilty. However, the judge directed Dasuki to submit his passport to the Deputy Chief Registrar of the court. The Department of State Service (DSS) arraigned...

Watch Jackie Chan Speak Pidgin, Yoruba, Igbo & Hausa

You probably might have seen this movie, " Dragon Blade", starring Jackie Chan, John Cusack, among others; but you have to see Jackie Chan speak  Pidgin, Yoruba, Igbo and Hausa in the bid to promote the movie to Nigerians. Watch clip below: https://www.youtube.com/watch?v=dBDD7S_bmGw Credit: FilmOne Distribution/ YouTube

Woman Allegedly Killed Her Infant Daughter, Kept Her Body For Months

Christina Colantonio, 28, has been charged with second-degree murder after police found her baby's dead body in her apartment. It is believed that Colantonio, who was living alone in the Batavia, New York, apartment, killed her daughter shortly after she was born three months ago. According to The Daily News, police responded to a call from an acquaintance of Colantonio's reporting a "suspicious condition" at Colantonio's apartment. "Batavia police detectives were...

Video: Banky W – “High Notes”

Banky W continues to prove his versatility as he premieres his first official single in 2015 titled “High Notes”. The video is finally out and we are super excited about it. Produced by Cobhams Asuquo, this RnB number has an infectious pop twist which sees Banky displaying his incredible vocals while teasing us with a rap verse. The video for “High Notes” was recently shot in South Africa...

Army Issues 7-Day Ultimatum To Community To Produce Killers Of Soldier, Policeman

Military authorities in Rivers State have given a one-week ultimatum to eight communities in Emohua Local Government Area of the state to fish out and surrender the gunmen, who allegedly ambushed and shot dead a soldier and police officer, while they were on duty along the Emohua-Kalabari Road in the area. Niger Delta Voice gathered that the incident occurred last week, and both the army and police in the state were furious....

I Have Not Been Approached, Caitlyn Jenner Opens Up On Dating

In the latest episode of "I Am Cait," Caitlyn Jenneropens up about her future and if that includes dating. "It's been, like, a month or two now that I've been out," she said at the time of taping for Sunday night's episode. "So I honestly haven't even thought or been approached or been tempted in any direction," she added according to People magazine's recap. Read More: GoodMorningAmerica

9 Best Compliments You Can Give A Woman

1. A Sweet Thought "'I want my daughter to turn out like you.' Told to me by two different men, one of whom I consider my professional mentor and one of the main reasons I got into the line of work I did. This was in my early 20s, when I was earnest, relatively vice-free and full of promise. The daughters in question were young teenagers. Haven't heard it lately, but I always thought of this...

Kris Jenner, 59, Shows Off Bikini Body

At 59 years old, it's safe to say Kris Jenner's still got it! The Kardashian matriarch showed off her enviable physique while walking on the beach in St. Barts during the family's annual vacation, sporting a little black bikini. Check out the mother-of-six's impressively flat stomach above. Read More: ETonline