COMMUNIQUE OF THE COUNCIL MEETING OF THE LAGOS CHAMBER OF COMMERCE AND INDUSTRY [LCCI] HELD 7TH FEBRUARY 2018
The LCCI Council meeting took place on Wednesday 7th February, 2018 under the Chairmanship of its President, Mr Babatunde Paul Ruwase, FCA. The meeting deliberated on the impact of heightened insecurity on businesses across the country as well as a range of other business and economic issues. The following are some of the conclusions of the meeting.
INDISCRIMINATE VALUATION QUERIES OF INVOICE OF IMPORTED ITEMS BY NIGERIA CUSTOMS SERVICE
The Council expressed concern over the indiscriminate valuation queries of invoice of imported items by Nigeria Customs Service (NCS), apparently in a bid to improve revenue generation. There should be a credible ground to dispute the value of invoice on imports. Most of the prices are global prices and are easily verifiable online. In many of the instances, the actions of the NCS have no bearing with these global prices. Prices vary across different regions of the world. Regrettably there is no dependable dispute resolution framework in place to ensure speedy resolution of such disputes.
The Council urged the Presidency, Minister of Finance and Comptroller General of Customs to look urgently into this issue. There should be an independent dispute resolution mechanism in place that could resolve valuation disputes within 48 hours because of the cost implications to importers of the delays. These include demurrage, penalties, interest costs on loans etc. The current arrangement whereby appeals are made to the customs headquarters is not consonance with the principle of natural justice. The Nigeria Customs should not be a judge in its own case.
Executive Order Five
The Council welcomes the latest Executive Order issued by the federal government which is aimed at encouraging local content and initiatives. The executive order tagged Executive Order 5 is to improve local content in public procurement with science, engineering and technology components. We request the government to extend local content order beyond the scope of science, engineering and technology, improve “visa-on-arrival” processes and ensure better transparency in the issuance and compliance monitoring of the expatriate quota.
However, council notes that the quality of implementation of this and previous directives is what will make the real difference in the outcomes and impact. For instance, the procurement policy for the MDAs which prescribes that patronage of made in Nigeria products should be prioritised in government expenditure is yet to be effectively implemented. The Cabbotage Law which was meant to create opportunities for indigenous players in the maritime sector is yet to have the desired impact.
SECURITY OF LIVES AND PROPERTIES
The growing level of insecurity across the country is of great concern to businesses and investors. Incidence of criminality, such as terrorist activities of Boko Haram in the North East, Herdsmen attacks and destruction of farms, kidnaping, armed robbery and cultism are impacting adversely on businesses.
This has the following implications for businesses and the economy:
- The security crisis has implication food security in the country, food inflation, shortage of local raw materials for agro-allied businesses, poor investors’ confidence, global perception issues for the country, investment and job losses in the near term.
- Cost of providing alternative security such as the provision of private security, escorts, and protection facilities /equipment by businesses in some sectors have increased by 12% over the last four years.
ABSENCE OF BOARDS FOR SOME MDAS
The Council noted that the board of some Ministries, Departments and Agencies critical to the smooth functioning of the economy are yet to be constituted and this have been undecided for some time.
For instance, the Central Bank of Nigeria (CBN), suspended its first Monetary Policy Committee (MPC) meeting in 2018 scheduled for 22 – 23rd January due to the bank’s inability to form a quorum as a result of non-confirmation of the newly appointed MPC members by the Senate. Also, the board of NAICOM and PENCOM are not in place. This situation is beginning to take its toll on the economy. Council urged the Presidency and the National Assembly to put the interest of the economy above their differences and constitute board for all the MDAs without further delay.
LAGOS CHAMBER OF COMMERCE AND INDUSTRY