NAGAFF @ 23: A Message of Professional Revaluation and Consolidation

By Dr. Eugene Nweke


While joining the Freight Forwarding Practitioners to celebrate the 23rd Anniversary of the National Association of Government Approved Freight Forwarders – Nagaff, permit me to also convey a MESSAGE OF CONSOLATION to the Freight Forwarding Practitioners in general and the Nagaff Family in particular.


RECALLING THE CUSTOMS LONG ROOM ERA:
It is on record that, on the 29th November, 1999 when the Nagaff was officially inaugurated, the system of importation and its clearance revolves around Pre-shipment Inspection and the struggle towards the migration from Asycuda 1.7 Site to Asycuda 2.3 Site of the Web Fontaine for Customs administration. Later a proxy Destination Inspection was introduced as prelude to full Destination Inspection under direct Customs Administration, hence, the world celebrated regime of Pre-Arrival Assessment Report – PAAR supported by NICIS1 and now NICIS2 Platform ( a central documentation warehouse).

DEPARTURE FROM THE LONG ERA – HIGH AND DAMPENED EXPECTATIONS :
Freight Forwarders expectations has been that through this departure from the Asycuda the new system will prompt a culture of trade compliance in all ramifications, since it was envisaged that the Freight Forwarders and other members of the trading community can electronically submit trade declarations to Customs for processing through this system. Wherefore, upon approval, the declaration is returned electronically to the sender.

IDEALISM OF THE PAAR CONCEPTS:
Ideally, a national trade computer networks or portal is targeted at facilitating communications and operations between the freight forwarders, shipping lines, airlines, customs and other government agencies and statutory ministries and the trad community by means of electronic data interchange ( EDI).
Ordinarily, as obtains elsewhere in other major international trading country with high import trading volume, the system should be seen thriving on the concept of mailboxes, with the NICIS serving as central exchange. That is to say, the moment a declaration is transmitted, it goes to the NICIS Platform inbox, where it is then routed to the mailbox of the relevant government regulatory agencies. The respective regulatory agencies gets mail alerts and on 24/7 process the declarations , after which an approval permit is sent back to the NICIS platform ( PAAR portal) outgoing mailbox for transmission to the freight forwarder, shipper or consignee, who in turn request for the issuance of the import value certificate. In addition, the system should be robust and interactive enough to resolve trade value disputes between the trader or his agent and the Customs.


NOTICEABLE LAPSES:
Unfortunately, the prevailing system is rather unflexable and coercing in application owing to maximum revenue targets of the government to the Nigerian Customs, whereby trade rigidity far overwhelms trade facilitation.
Again, to enhance compliance in this regards, we had expected the Customs to introduce a support systems that will require the trading company ( importer and exporter) to nominate two (2) authorized declarants for processing both import and export declarations and in addition nominate its processing licensed agents. Rather, it resorted to Trader Identification Number – TIN application and agency declaration number.

CONSEQUENCES OF NON PROMPT COMPLIANCE AND SYSTEM DISRUPTION :
The resultant effects is that, the system has not meet the expectations of the freight forwarders, as provable evidence shows that, with the management setting up a presumably an interventionist ad-hoc committees ( now has taken the status of a seeming permanent administrative units) along the delivery corridors and the present regime of multiple alert systems, is a clear indication that, the system ( NICIS) has not provided the expected quest for trade compliance culture. In addition, human contact to cargo is still very high and more imports still goes through the red lane , that is the physical examination of cargo. The unprecedented weekly seizures of concealed and prohibited goods. The cost cargo clearance has gone way up above expectations. Malpractices in the systems thrives without recourse to adequate checks and supervision. Presently, sense of professionalism has been jettisoned to give way for a culture of ” businessmen in and out”.

REDIRECTING PUBLIC POLICY ADVOCACY FOCUS1:
With the World Customs Organization ( WCO) quest for compliance towards the evolution of the ” Smart Borders concept” – a further strengthening of the Simplification and Harmonization of processes and procedures of the Kyoto Convention of 2004 to a seamless integration of processes and operations on the premise of “Secure, Monitor, Automation, Risk management and Transparency amongst its signatory members, the present scenario of cargo clearance and handling operations within the customs ports, simply suggests that much is desirable, especially so along the delivery corridor.
In this regards, @ 23rd anniversary of Nagaff, public policy advocacy should not focus only on the evolution and implementation of the concept via domestication, but rather, advocacy should emphasize that, if the Customs must maintain checks points along the cargo delivery corridor out of the ports, then it must seek for the creation of a special check lane dedicated for this purpose. By so doing it will help alleviate the traffic jam usually caused by the rampant stoppages and interception of cargo leaving the the port to the owner warehouse.

PROFRSSIONAL REDIRECTION TOWARDS THE ENHANCEMENT OF SCOPE OF FREIGHT FORWARDING PRACTICES:
You recall that, the Free Trade Zone acts as a transhipment hub. As such the diving force and effectiveness of a Free Trade Zone – FTZ , rests on the shoulders of the freight forwarders. This is because in the FTZ of any country, freight forwarders can easily move, transfer, consolidate, break bulk, mix, store and repack goods without documentation or customs duties. This is convenient for not only the freight forwarders, but also for shipping lines, airlines, importers and exporters as well.
Good a thing the government has classified and approved several free trade zones even though much is desired.
In the strength of the above, the Nagaff should equally redirect its public policy advocacy drives towards the official designation and upgrade of all the inland container depot to a Free Trade Zone areas. It is no longer news that, only goods leaving the FTZ need documentation to clear the centralized customs and security checkpoints. Security is tight in all FTZs, as goods must be thoroughly screened and inspected by designated security personnel and customs officials.
Regretably, only few freight forwarders understands that thjs is their professional bits, so many sees it as business for the foreign operators or manufacturers alone. Some others, thinks that, the concept of the FTZ mainly tilts towards oil and gas. Therefore there is urgent need to joint collaboration with the professional regulatory council ( CRFFN) to revist its professional specialty certification program.
May I emphasize that, the Freight forwarders must be encouraged to widen their professional scope other than the present crowding of the seaports terminals , bonded terminals, airports terminals, etc.
Most importantly, the concept of the FTZs will aide and fast track the professional practices and participation of the Freight Forwarders in the on going implementation of the Africa Continental Trade Agreement – AfCTA regime, most especially, with the existing inland container depots upgrade to the dual status of Free Trade Zone areas.

THE DYNAMICS AND IMPACTS OF SHIPS AND PORT DESIGNS:
Also recall that, with the changes of port administration – a migration from public or state owned enterprise(SOE) to private owned enterprise in 2006 via concession agreements. Sixteen years after, it was discovered through the revalation by the NPA managing director, that port concession agreement was skewed against the nation’s interests, whereby given credence to the Freight Forwarders earlier position and outcry of an “Unstructured Port Concession “. Today, the government cannot boldly boast nor confidently lay claims that its core aims and objectives of this concession policy has been achieved by 50%. However, it doesn’t foreclose the fact that, some of the private operators invested reasonably and squared up towards the discharge of the concession agreement, as some pointed at the government agency of not meeting up or discharging its own bargain of the agreement. In this instance, the apapa gridlock becomes a handy instance.
The true picture of our port scenarion shows that, there are noticeable inconsistent tracking in relation to the turn around time of vessel, cargo dwell time in the ports and turn around capital and trip of the Forwarders cum truckers, which are considered as being high and unrateable. Cost of clearing good or doing business very high, ridden with arbitrariness and defiling the government canvass for ease of doing business templates. Then comes the reign of uncompetitiveness in the ports , with every apology to the popular gridlock.
The worst treatment against the average Nigerian Shippers is to set up a committee to blatantly forward stem or reallocate their imports to the bonded terminal without recourse tomthem and in defiance to the established and extant contract of affrightment with the carrier, contract terms covering freight earning based on a named port of origin to a named port of destination.
Not withstanding, the freight forwarders were not promptly represented nor requested to advance a position paper during the cumulative performance reevaluation and concession agreement renewal process.
Going forward, hope for an even port competition bekons with the coming on board and commissioning of a deep sea port at lekki epe, Lagos and other deep sea ports under construction.
Public policy advocacy drives should be chanelled towards constructive engagements with the concerned authorities to stem the tidy of difficulties and financial losses incurred by the Shippers for stemming their imports to the bonded terminals many of such ar not adequately regulated nor has adequate cargo handling facilities in them. Public policy advocacy drives should also embrace partnership to seek for redress in a matter of charges without cost functions and arbitrary acts without recourse to written agreements .

NEED FOR UPPING THE SERVICES PROVIDERS ROLES OF THE FREIGHT FORWARDING PROFESSION:
Today, freight forwarders can be classified as :
a). Freight Forwarder or Cargo Agent.
b). Third Party Logistics Providers ( 3PLs
c). Integrators/Express Operators,
d). Forth to Tenth Party Logistics Providers ( 4PLs to 10PLS).
e). Warehousing Facilities Operators.
This development arosed from the fact that, the Freight Forwarders now assumes various roles in addition to freight forwarding to offer one stop service to their clients. In a competitive environment coupled with high quality service expectations from the customers, it then means that , a freight forwarders must consistently upgrade his or services in order to retain their businesses.
Most importantly to note, there is no room for error or poor services in a service driven industry. Today Shippers pays attention to the Freight Forwarder’s management expertise, labor skills of the staffs, level of technology application, quality of facilities, organizational network, financial status, reliability and credibility.
Let me also state clearly, It is the duty of the freight forwarding professional associations to initiate a process of formalizing procedures, probe every information technology system, articulating toward industry average with regards to pricing, handling and environmental issues, for onward considerations.
Unfortunately, there exist a gross missing professional gaps and misgivings inherent in the present scenario. From available reports, we have more of businessmen and women parading themselves as freight forwarders than the real professional freight forwarders, this reports has to be revisited.

It is on this note that, I wish the Nagaff cum freight forwarders a happy 23rd anniversary.

Fwdr ( Dr) Eugene Nweke Rff, Fnis, Fpta, Ksm.
Former National President of Nagaff.

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