CUSTOMS TO GENEARATE N5.079 TRILLION THIS YEAR—CGC
The Nigeria Customs Service is expected to generate N5.079 trillion this year. The Comptroller-General of the service, Adewale Adeniyi, MFR disclosed this today in a press briefing.
He also stated that the service generated a total of N.3,206,603,417,315.47 last year. marking a noteworthy 21.4% increase from the preceding year’s total revenue of NGN
2,641,616,673,501.83. This growth aligns with the NCS’s consistent upward
trajectory, as evidenced by a 17.88% revenue increase in 2022. The consecutive
expansion in revenue underscores the Service’s sustained efforts in optimizing
revenue collection for the Federal Government and exemplifies our ability to
adapt to dynamic economic conditions.
This CGC said this achievement is particularly remarkable given the challenges within the operational environment. Operational challenges such as lower transactionvolumes, compliance issues, inadequate infrastructure, and capacity gaps were compounded by delays in policy implementation and socio-political factors.
The anxiety associated with a major election year, the prolonged cash crunch linked to the introduction of higher denominations of the new Naira bills, temporarily impacted purchasing power and overall economic activities. The transition of power to the President Tinubu-led Administration brought about new policy direction, including the removal of fuel subsidy, the floating of the exchange rate, and the closure of Nigeria’s Northern borders with Niger Republic, adding
another layer of complexity.
According to him, these challenges led to a revenue shortfall of NGN 532 billion in the first half of the year, falling short of the projected revenue target of NGN 1.84 trillion.
However, a positive transformation occurred in the later part of the year,
following my appointment as the Comptroller-General in July. This was
accompanied by a merit-based reconstitution of the management team, resulting in a significant shift that enabled the Service to exceed monthly revenue targets by 6.71% for the first time in 2023. Monthly revenue collection for the latter half of the year averaged NGN 332.9 billion, a substantial increase from the initial
NGN 201.7 billion recorded in the first half of the year. This positive trend can
be attributed to strategic measures, including the immediate establishment of a Revenue Review Recovery Team and the dissolution of existing Strike Force
Teams, streamlining enforcement under the Federal Operations Unit (FOU).
Additionally, strategic reassignments of Customs Area Controllers, the creation
of an ideas bank, and extensive stakeholder engagements collectively contributed to this impressive resurgence.
The improved revenue collection in the latter half of 2023 played a crucial
role in significantly reducing the revenue shortfall by 10%, decreasing from NGN
532 billion to NGN 478 billion by year-end. This calculation is based on the
government’s projected revenue collection by the Nigeria Customs Service (NCS)
of NGN 3.684 trillion and the actual collection of NGN 3.206 trillion.
Moreover, the deficit in NCS revenue collection can be ascribed to deliberate government initiatives and incentives designed to foster the growth of various sectors within the economy. Specifically, the government approved a concession of NGN 2 trillion, incorporating select dutiable items under the new Tariff heading Chapter 99. This policy shift resulted in the exemption of duty payments on certain dutiable goods, previously falling within a duty range of 5% to 10%. The overarching objective of these granted waivers and concessions was twofold: to stimulate development across diverse economic sectors and to bolster the nation’s overall peace and security.
The NCS sustained its vigorous campaign against smuggling and illicit trade, culminating in 3,806 seizures with a Duty Paid Value totalling NGN 16,049,023,262.
CG said these confiscations encompassed a diverse array of contraband, including Arms and Ammunition, Artifacts and Antiquities, illicit drugs, expired food produce, and endangered species of flora and fauna. Remarkably, the NCS achieved 52 convictions, with 11 specifically linked to the illicit trade in Animal/Wildlife. Noteworthy is the international acknowledgment garnered for the Service’s efforts in combating this illicit trade in Animal/Wildlife. This steadfast commitment underscores the NCS’s dedication to protecting Nigerian society, maintaining a resolute stance against smugglers, and diligently dismantling their operations.
He said, going forward, numerous strategic initiatives are poised to positively
impact the Service’s performance in the coming months. These initiatives include the introduction of the Advanced Ruling system, aligning NCS operations with global best practices and meeting the recommendations of the World Trade
Organization Trade Facilitation Agreement (WTO TFA). Additionally, the
inauguration of a Steering Committee on the Implementation of Authorized
Economic Operators (AEO) for Compliant Traders underscores our readiness to
transition from Fastrack 2.0 to the AEO concept. Engagements with the
international community, such as those with the World Customs Organization
(WCO), JICA, and Japan Customs, focused on key areas is expected to lead to
the implementation of the Customs Laboratory, adoption of geospatial
technology, and the conduct of a Time Release Study. Collaborative efforts with
the Customs Administration of the Republic of Benin, the revitalization of zonal structures, and integration of Customs institutions into the administrative framework all contribute to NCS’s commitment to efficient service delivery and positive stakeholder relationships.
The NCS also responded to changes in legislation, engagement with the National Trade Facilitation Committee (NTFC), initiated Corporate Social Responsibility projects, integrated efforts with the Federal Road Safety Corps (FRSC), enhanced personnel welfare programs, and
introduced the Work-Life Balance (WLB) initiative. In the upcoming week, the
NCS is set to inaugurate an electronic auction (e-auction) platform, strategically
designed to enhance transparency in the auction process. These collective actions
signify NCS’s dedication to enhancing staff welfare and sustaining optimal performance.
For the fiscal year 2024, the NCS has been allocated a new revenue target of NGN 5.079 trillion, aligning with the government’s economic objectives. This
target signifies the government’s confidence in the NCS’s capabilities and
underscores the Service’s important role in contributing to the nation’s fiscal
wellbeing.
The strategic initiatives detailed above, alongside other operational
reforms, are anticipated to play a crucial role in achieving this revenue goal. As
the NCS addresses the challenges and opportunities in 2024, the Service is
steadfast in its commitment to implementing these strategies and exploring practical approaches to meet the heightened revenue target. This commitment aligns with the NCS’s ongoing dedication to efficiency, excellence, and positive contributions to Nigeria’s economic landscape.
Notwithstanding these concerted efforts, NCS is also conscious of the topical trends and issues that will impact the Service operations in 2024. They include:
a. Alignment with Government Policy Direction. The President Bola Ahmed Tinubu Led Administration has identified eight priority areas, including food security, poverty eradication, growth, job creation, access to capital, inclusion, rule of law, and fighting corruption. In addition to these priority areas, NCS has identified 21 relevant areas outlined in the Policy Advisory document. These areas will continue to shape NCS’s operations throughout 2024, aligning with the broader policy goals of the government.
b. African Continental Free Trade Area (AfCFTA). Nigeria’s pivotal leadership role is underscored by its distinction as the largest and most populous country in Africa, boasting a significant industrial presence. Notably, Lagos alone contributes substantially, accounting for 80% of
Africa’s Cultural Services export. The inception of the Guided Trade Initiative (GTI) on October 7, 2022, saw over 30 countries participating, with Customs assuming a leading role in the implementation of the AfCFTA. As the driving force behind AfCFTA execution, Customs holds a central position in shaping government trade policy. The NCS is resolutely committed to actively contributing and playing a pivotal role in aligning its operations with the dynamic facets of AfCFTA.
c. Customs Modernization. NCS recognizes the constant evolution of its operating environment, influenced by technological advancements shaping customs operations. These trends will be integral to NCS activities, and the service is committed to staying abreast of
technological changes, ensuring continuous modernization to enhance
efficiency and effectiveness.
d. Border Management. The zero-tolerance approach towards smuggling, especially of petroleum products out of the country, will be rigorously enforced. NCS remains resolute in addressing border management challenges, balancing security concerns with trade facilitation.
e. Leveraging on NCS Act to Implement Modern Procedures. The NCS Act, signed in May 2023, provides a platform for modernizing operations, enabling initiatives such as the AEO program and the Advanced Ruling System. NCS is committed to leveraging this act to
explore further areas for enhancing the trade experience in Nigeria, ensuring efficiency and effectiveness.
f. Stakeholder Engagement. The year 2024, dedicated by the WCO to Engaging Traditional and New Partners with Purpose, underscores the importance of collaboration.
Building on the foundations laid during the just concluded Comptroller-General of Customs Conference in December 2023, a joint declaration by NCS and stakeholders commits to working more effectively. NCS will rigorously pursue these engagements based on timelines and deliverables.
g. Intensive Capacity Building Initiatives. With the imminent departure of over 50% of our management staff, who have rendered meritorious service for up to 35 years, the NCS foresees a substantial turnover. This impending change, combined with the dynamic global trade environment influenced by advancements in Artificial Intelligence and Data Analytics, underscores the necessity for an ongoing enhancement of the workforce’s skill set. Recognizing these imperatives, the NCS is resolutely dedicated to executing intensive capacity-building initiatives.
These endeavours are designed to uplift the capabilities of younger officers, ensuring a seamless transition without disruptions to activities and
operations. The Service remains committed to effectively managing this
transitional phase, complemented by the ongoing training of officers in data analytics and other Customs operations as part of the continuous skill upgrade process.
h. Exchange rate effect. A notable factor influencing NCS operations is the fluctuation in exchange rate. The Service acknowledges the impact of currency exchange variations on trade dynamics and revenue collection. NCS aims to address this challenge proactively by considering strategies to mitigate potential adverse effects. One of the key strategies is to regularly update the exchange rate in line with the going market conditions. This approach is geared towards ensuring optimal revenue performance in the face of currency fluctuations and maintaining adaptability to changes in our operational environment.
As we advance in 2024, the NCS is committed to strategically charting its
course for the future. The global and national trends, including the AfCFTA and
WCO theme, will shape Customs operations. The focus remains on aligning NCS activities with government policy, enhancing stakeholder engagements, and
fortifying operational preparedness through technological advancements and
capacity building.
The NCS will continue to adapt to emerging challenges, foster collaborations, and uphold its commitment to integrity and administrative procedures. The outlined strategies, coupled with ongoing initiatives, are poised to facilitate the achievement of the newly set revenue target of NGN 5.079 trillion for the fiscal year 2024. The Service invites all stakeholders to actively participate in this collective journey towards a more efficient, transparent, and revenue-optimized Customs operation for the benefit of the nation.
The CGC said, in the face of these goals, I must emphasize that the NCS will maintain a zero-tolerance stance towards indiscipline and non-compliance in the year 2024.
It is imperative for all officers and stakeholders to adhere strictly to established procedures and regulations. Maximum cooperation is expected from every stakeholder in the customs operations.
The success of our collective efforts depends on the discipline and commitment of each member. Let this be a year where every action is aligned with the principles of efficiency, transparency, and
revenue optimization with the overall aim of contributing meaningfully to the
economic prosperity of our nation.
Thank you for your attention.