(LIFE AND LIVING) Why Nigeria is witnessing massive drop in importation – Chief Afamefuna Albertino Chukwuma, NAGAFF Dep. Nat;l President
Chief Afamefuna Albertino Chukwuma is the Deputy National President (Seaport) National Association of Government Approved Freight Forwarders (NAGAFF) and the Managing Director/CEO of INTERNATIONAL SUPPLY CHAIN SYSTEMS LTD. He was recently given the Iconic Personality Award by the Naija Police and U organisation. The Nigerian Xpress interviewed him at the ceremony:
What does the recognition mean to you?
The award for me is a sign of appreciation and recognition. I was not expecting any award. I was just working because it’s what I had to do. I have to do my bit and impact society and enhance the goodness of the human race.
So, it came as a surprise to know that some people somewhere were watching. Little did I know that there would be an award. I very much appreciate that and it means a lot to me. However, it goes further to inspire me to do even more than I had done before. So, for me, the award symbolises inspiration to work harder and do more.
One of the striking things about you is that you studied Political Science at the university but have become a guru in the maritime sector. How did that happen?
That is one thing about our educational system. We grew up in a country where you have parents who wanted their children to be lawyers, engineers, or doctors. So, I wanted to study Law but unfortunately, I wasn’t admitted.
So, Political Science became the next alternative for me and I got admission. I was supposed to even change in my second year but I fell in love with the course.
After I graduated, I had to face the reality of the labour market. Luckily, I found myself in the trade logistics environment. While working there, I also saw opportunities in that industry. So, I began to improve my knowledge of the industry. I started studying courses.
I have studied about seven short courses, some in the U.S., in international trade logistics and the maritime before I finally enrolled in the University of Lagos to study Maritime Transportation for my Master’s degree. Currently, I am a Ph.D. student at the World Maritime University, Malmo, Sweden.
Of course, we have ambitions; we know where we are going. I am also a practicing freight forwarder in the industry and I’m not just an anyhow practitioner.
As the deputy national president of NAGAFF, I am in charge of all the seaports in Nigeria – Lagos, Calabar, Port Harcourt, where have you – when it has to do with professional associations. So, God has been kind and I have an in-depth understanding of the industry.
In our days there was no university in Nigeria where you can go and study maritime. There were no short courses anywhere. Even when I went to UNILAG, we were the second set that studied Maritime Administration under the Department of Geography.
That was in 2009. Of course, by now they have created an affiliate institute with the university to run maritime programmes. But up till now, there is no department called the Department of Maritime Studies. The closest you could have is Aquatics. But the trade, the business, and the law of maritime are very versed. So, I’m grounded in both the theories and practice of maritime.
At what point did you establish International Supply Chains Systems Ltd?
I was working with Global Scan Systems Ltd. Global Scan was an inspection and certification company. When Chief Olusegun Obasanjo became president in 1999, the first thing he did for the maritime industry was to reform the port system. So, he removed many operations from the hands of the Nigeria Customs Service and put them in the hands of private firms. We had a company called SGS, a French company; Cotecno, a Dutch company; and then Global Scan.
Three of them were doing the same thing but Global Scan was the only indigenous firm. They had a contract on Build, Own, Operate and Transfer (BOOT) terms. They were to develop technologies, own them and eventually transfer them to Nigeria Customs. So, we were training Customs on the job in the maritime sector.
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Global Scan employed me after my youth service and we started getting training from expatriates. Then the company introduced a scanning machine that could scan between 200 and 500 containers in two hours. The idea was to decongest the ports. Before then, vessels would come to Nigerian ports and spend two to three weeks without even being allocated berths where they would discharge their cargoes. The report went back to foreign countries and nobody wanted to come to Nigeria. They called it port congestion, which was caused by inefficiency and mismanagement.
So, the scanning machine was introduced to ensure that as your cargoes were arriving, they were going through the machines and getting scanned. And I tell you; my team and I were the first team of Nigerians ever trained to operate that machine. I even worked at Seme Border where there was a high level of smuggling and movement of small and illegal arms. We used the machine to detect some of these things.
However, I knew it was a contract that would end someday because it was a BOOT agreement. And the then Comptroller General of Customs, Dikko, was very serious about the Service taking over the job from the private companies.
He wanted to prove that Customs could do it. So, I started asking myself: If we hand over to Customs, what would I be doing? There were my colleagues who Customs called and employed and they became Customs officials to date. But I didn’t want that. I chose to do my thing. I didn’t want a situation where I would be posted out of Lagos and I would go and start lobbying to be retained. So, I had to start my firm. I resigned from Global Scan even before the expiry of the contract. To the glory of God, it was a worthwhile decision.
What have been the contributions of the firm to the sector since its inception?
Like every normal business, you have to go through developmental stages when you start. I had strong plans before I left Global Scan but it was not easy. I told a friend recently that two maxims could have discouraged me from forging ahead with the bold step. My seniors in the office were telling me that ‘A bird at hand is worth more than 1000 in the bush’ and that ‘Half bread is better than none’. But I kept telling myself that the contract would end someday.
When we started, I was the managing director, secretary, and everything right in my house. Through the friendship I developed with Customs officers when they came for training at Global Scan, I was able to get my licence. We later left my house to rent an office at Cele, along Oshodi-Apapa Expressway.
When our client base started increasing, we moved to Ibru House, Apapa. God kept being faithful and from Ibru House we moved to where we are today. We came here as tenants, occupying the entire first floor but after two years or thereabout the landlord negotiated with us and today we are the owners of that property.
So, it has been one success story to another. But the most important is that the knowledge about the industry is there. My background as someone who was trained to train the Customs helped me a lot.
I brought that knowledge into the industry and I’m even using it to help the Nigerian government in formulating its policies.
My opinions are highly appreciated by the Fiscal Policy Committee of the Ministry of Finance when it comes to making fiscal policies about the maritime sector, especially in my capacity as the deputy national president of NAGAFF. We have gone to the National Assembly to make presentations. They look forward to our memo every January before they finalise their policies on the industry.
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Given your deep understanding of maritime issues, how would you assess the sector in Nigeria?
The sector has not been fully tapped or developed. The sector still has a lot to achieve when you compare it with other countries of the world, largely because of the normal Nigerian attitude. However, it’s in every sector; it’s not peculiar to the maritime sector. So, with that understanding, I can say we are not fully developed.
But this sector is the second largest revenue earner for the Nigerian government after oil. It is the sector that generates the highest IGR for the government through taxes, duties, levies, and what have you. After NNPC, the next in line concerning revenue generation is the Nigeria Customs and then the Federal Inland Revenue Service (FIRS).
And even 50 per cent of the revenue generated by FIRS comes from Customs. When you are paying your duty, there is a column for 7.5 per cent VAT, which goes to the FIRS through the CBN. So, the FIRS reports income generated through the Customs; of course, they (FIRS) have the ones they collect directly from companies.
So, it is a very important sector that the country cannot toy with. If tomorrow they say that oil has dried up in Nigeria, it is the maritime industry that the Federal Government will turn to. They are already turning to it. Any decline in that sector affects the government.
The good thing is that it is a sector that will last forever and always feed the nation. Do you know why? We are an importing nation. Eighty per cent of what we use in this country is imported; we are just a set of consumers. However, the good thing is that when we get the economy right and fix the problem of importation, export will take over immediately.
And it will still pass through the ports. That’s why I said the sector will last forever. It is a sector that no meaningful government can ignore; you cannot even do without it. But, unfortunately, the government is not doing enough to sanitise and give support to the industry.
For instance, the port access roads. Let’s take Lagos ports as a case study. When was the last time you drove your car from Mile 2 to Victoria Island? Before now, people don’t go through Orile to Victoria Island but through Apapa because it’s shorter. But in the past 10 years or thereabout, people have not been able to do that. Now, what is the problem? Is it that the money is not there?
The government does not need to get money from external sources to fix the port access road. If the government can put only one per cent of the money they make from the port system back into the port community for its development, that place would be like any other place in the world.
You spoke about ‘Nigerian factor’ as part of the problems hindering the development of the country’s maritime sector. What are these factors and how can the government deal with them to enable the country to reap the full benefits of the sector?
The factor of corruption; the factor of lack of patriotism; the factor of self before the nation; the factor of it is their thing, not my thing, and the factor of an indifferent attitude towards government properties. There is no commitment. I don’t know how many Nigerians are willing to die for the country they love so much.
I don’t know how many Nigerians are ready to go the extra mile to play their hearts out for our dear nation. I don’t know how many Nigerians will stop other Nigerians who are doing the wrong things because they know we have no other country than this.
We must come to a point where we will treat our country the way we treat our families. That is what is lacking.
So, we need a complete change in attitude. But then I agree with the school of thought that says for this to happen it must start from the top, sincerely. If the man at the top gives direction not just by saying it but also by attitude, in truth and spirit, others will follow.
We must say enough is enough; it’s time to fix this country. We must do away with corruption, selfishness, and personal interest before national interest. Let us stop collecting bribes and build this country.
Why would a Customs officer collaborate with people who engage in sharp practices to shortchange the Federal Government? Why would a police officer or an NPA official at the port collect money from importers to allow what he/she should stop? Why would the people in power not use the money collected for the common good?
A uniformed man once asked me: ‘Why do you want to pay 100 per cent duty to the Federal Government when you know that when that money gets to that purse, it would be looted?’ So he said to me, ‘give them little; give me my own, take your own so that the country will be moving forward. Such orientation is what has kept us where we are and it must change. We pray that one day we will have a leader that will deliver us.
What are your ideas towards checkmating the activities of pirates on Nigerian waters because that is one of the problems bedevilling the port system?
When I speak about the Nigerian attitude, it cuts across everything we do. If I condemn the maritime sector without taking into cognisance the attitude of the Nigerian leadership, then I am not being fair to the sector because it’s not as if we are better elsewhere.
Pirates are just like common thieves. If I say the government has not been able to curtail the activities of pirates on our waterways, then what do I say about banditry and kidnapping on our roads?
What do I say about our airports where we see cows blocking our aircraft from taking off? So, it’s still the general security problem of Nigeria.
We are looking at a situation where we will have a Chief of Naval Staff that will be able to bark and bite; that will deploy not just men of the Nigerian Navy but also enough technology to even detect from their control room that people are moving on the waters. Because they could not do that, they had to hire Tompolo to secure our waterways and oil pipelines. So, the Navy has failed.
The Nigeria Police has a Marine Unit charged with the responsibility of securing our waterways. Even the Customs has a Marine Unit that patrols the waterways with their speedboats. So, the police and Customs ought to be there before even the Navy comes with warships. But what do we have?
They are only interested in what they can get from the port system. They are busy chasing containers that are moving on the roads and fleecing importers while pirates are striking.
But as I said, I will not take this as exclusion because I know the security situation of the country. So, if we can fix the security of the country, we would be able to tackle the menace of pirates on our waterways.
Would you say that the problem of port congestion has been finally addressed?
Well, I think the Obasanjo reform was a turnaround. We now see a turnaround time of 48 hours as against the two to three weeks that we used to have. So, the situation has tremendously improved coupled with the drop in trade.
Recently, there has been a massive drop in trade because of the scarcity of foreign exchange. We are in a situation whereby businessmen cannot plan; they cannot predict. Business revolves around the ability to predict; ability to project and plan.
If the exchange rate keeps fluctuating especially the dollar to naira, it’s very difficult for any businessman to trade or invest. The best thing they do is to be cautious because if the exchange rate goes down suddenly, you can also become a poor man overnight.
What is going on is that if you bought goods at an exchange rate of N700 to a dollar, when you finish selling those goods with a little profit margin and want to replenish your stock and the exchange rate has risen to N800 to a dollar, you have to use all the profit you have made and even look for money from other sources to be able to re-stock your goods.
So, you have made no business. If by the time you finish selling your new stock and the exchange rate has gone up again, you add again. That has been going on. Now the problem is not that it’s high. Everybody is afraid that it’s going to hit N1000 to a dollar. If it’s N1000 per dollar, there is no problem.
The worst that can happen is that there will be inflation. But let the system is stable. That is what people are clamouring for.
The situation now is that if you used N10 million to buy $100,000, you will need N20 to N30 million to buy the same N100,000. But $100,000 remains $100,000 abroad.
So, instead of bringing two units, you will be able to bring one because your capital base can no longer afford it not for any fault of yours but due to policy issues and exchange rate fluctuations. That is where we have found ourselves and that’s why we don’t have port congestion now. The trade volume has dropped significantly.
