- Customs generated N2.2trn revenue in 2022
- Customs generated N2.2trn revenue in 2021
- Customs generated N1.56trn revenue in 2020
- Customs generated N1.34trn revenue in 2019
- Customs projected to generate N3trn revenue in 2023 (projected)
Nigerians should stop celebrating the always records-breaking revenue of Nigerian Customs. Yes, yearly, we are informed that the Customs has generated another huge revenue. Good People, there is nothing to celebrate for those numbers.
As I have written here since about 2017 when I came back fully to LinkedIn, there is a clear correlation between increase in Customs revenue and de-industrialization rate in Nigeria. In other words, that P&G will fold its factories in Nigeria, and then begin to export to Nigeria, making it possible for Customs to “earn” more fees, does not make us a better country. When Michelin folded in PHC, it did not stop us from using Michelin tyres. What happens now is that we have to import the tyres – and as that happens, our Customs revenues will go up!
Left and right, Nigerians must ask tough questions: are we better increasing Customs revenue targets or do we want to produce things within Nigeria, and reduce imports?
This post is not about the men and women working in Customs. For one thing, I commend them for being super-efficient to even collect this money, and the new team seems amazing.
As a teacher, I am asked to speak to company Boards and they do pay to cover amala, nkwobi and zobo. I was trying to examine the economy, focusing on de-industrialization in the nation. I am using ten indicators to make my point (you need to offer something amazing to be invited next year) and one is the growth on Customs revenue. Follow me: the agency has a monthly target of N307 billion monthly: “I am delighted to announce that we have consistently exceeded the monthly target collection of N307 billion, marking a remarkable departure from previous performances”, noted the Comptroller-General of Nigeria Customs Service recently.
As I write, the Customs has improved revenue remarkably: “the service collected an average revenue of N202 billion in the first half of the year , but by October, the monthly revenue collected had reached N333.9 billion, showing a 65.5 per cent increase.” In other words, the Customs was collecting about N202 billion in say May 2023, but now collects about N334 billion monthly. They are doing great and kudos to the team.
The newspapers and TV pundits hailed that for the nation. Yet, if you look deeper, you will notice one thing: Nigeria is becoming a trading hub as companies shift to export instead of make in Nigeria, since the Customs revenue is not coming from exports as ships are still leaving our ports largely empty. Also, these are not equipment and machinery; these are basic imports of household and business consumables which ought to be made in Nigeria.
Again, we commend the Customs team but we must not celebrate these huge numbers. For everything, the double digit growth we’re seeing in the customs revenue will remind us that Nigeria is being de-industrialized!
The Revenue will keep going up
We are learning from Leadership that henceforth, the Customs will be using an exchange rate of N951.941 to a dollar. Simply, more revenue is coming.
“The federal government has increased the Dollar exchange rate, from N422.30 to N589.45, then to N770.88. In November, it was moved to N783.174 ans now, we are at N951.941 to a dollar. What it implies in simple terms is that, if clearing agents have a Debit Note that has not been paid on the system or Pre-Arrival Assessment Results (PAAR) or they have given you the value and you have not captured, it has affected you directly.
“We just believe that maybe with time, we will see low exchange rate and it will become beneficial to the importers as well because once there is a change in the portal, there is nothing anybody can do about it. But if you have captured or accessed your work, you are good to go and your consignment would be released for you if you don’t have any infraction.”
She explained that only clearing agents that had done the capturing of their consignments would pay with the old exchange rate.
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