Business
Bottlenecks worsen vehicles clearance, ease of business
Lagos fixes bottleneck at NNPC junction, Ejigbo, Lagos …yesterday.
• Hundreds of dealers, and agents to be thrown out of business
• Used cars from China, and Europe not captured on the VIN system
• Dealers fear only Nigerian-used vehicles will be on market soon
• Lexus, and Mercedes-Benz are not included in the new valuation system
• Importers abandon older cars due to unreasonable duties
Hiccups in the vehicle valuation system of Nigeria Customs Service (NCS) may hamper the importation of used cars just as thousands of dealers and agents are on the verge of losing their livelihoods, investigations by The Guardian have revealed.
It was learnt that the controversial electronic Vehicle Identity Number (VIN) valuation system, despite having undergone review, is being sabotaged, causing pain to importers who face hurdles in the process of clearing their vehicles.
As the challenges linger, many importers have been forced to abandon their vehicles at the terminals, accumulating demurrages – a situation that has increased the costs of vehicle clearing and purchase.
Recall that the Customs service introduced the VIN Valuation policy in January 2022 to aid trade facilitation and enhance the cargo delivery process. The platform was intended to reduce human intervention and make clearing more seamless.
This was greeted with controversy as agents protested outrageous increases in tariffs due to inaccurate data and the valuation process.
Subsequently, NCS suspended its implementation to review the complaints, triggering a backlog of vehicles awaiting clearing and extreme port congestion.
Two months after the policy was re-introduced, the old complaints remained. Customs had disclosed that the valuation template has been designed with the base model (2013) being used for the new pricing.
Findings revealed that the reviewed VIN valuation policy is discriminatory, as it only works with standard chassis vehicles, while it excludes the non-standard chassis (damaged) vehicles.
It was also learnt that for a 2007 or 2009 vehicle under the non-standard chassis vehicles, the duties are different and not uniform.
Still, vehicles from Europe and Asia have not been captured in the new valuation system, forcing importers to do under-table dealing with clearing officials, compelling them to pay more than required.
Apart from vehicles from Europe and Asia, Mercedes Benz (ML and X-Class), Lexus and Range Rover are excluded from the valuation.
The National Publicity Secretary of the Association of Registered Freight Forwarders of Nigeria, (ARFFN), Taiwo Fatomilola, told The Guardian, “only American vehicles are computed in the VIN valuation platform, although Mercedes Benz and other high-powered vehicles like Lexus, Range Rover are not on the VIN system.”
According to clearing agents, once they apply for duty on such vehicles on the VIN system, it gives an error outcome, which means they have to apply to the Customs Area Controller (CAC) of the command for value identification.
Sources said such applications are processed at discretionary costs with customs officials turning the process into a money-making venture.
To get the valuation done on time, agents and importers pay special fees for fast-track. Otherwise, their vehicles would be delayed unnecessarily while accumulating demurrages. The Guardian learnt that the least amount paid for fast-track is N10,000. Agents also disclosed that they are extorted when vehicles go through physical inspection.
“If you bring N2,000, you wait for three days, but when you bring N5,000, they will take it immediately. Your cash determines when the CAC is available to sign the documents, which will join other documents on the table waiting before the approval will be given. For the processes through the CAC office, it will take you not less than N5,000.
“If you want to go for valuation assessment, cars go for around N7,000 to N10,000, it depends on the value you are bringing forth. If you want a lesser value, you have to pay more than that,” Fatomilola said.
The abrupt reduction of the age limit of vehicles from 12 to nine years has also been blamed for the sudden rise in the cost of vehicle clearance. Older cars already brought into the country are being abandoned, worsening congestion at the port.
This has also reduced the importation of used cars, as findings revealed that many importers have had their money trapped in abandoned vehicles.
Recently, the House of Representatives Committee on Customs and Excise said that even though the VIN Valuation policy is aimed at improving revenue generation and fast-tracking the process of clearing imported goods at the nation’s ports, the workings are illegal.
The Chairman of the Committee, Leke Abejide, during a tour of customs formations in Lagos last week said the ‘Standard VIN and the non-standard VIN’ as being operated by the service is illegal and that the lawmakers might scrap the platform.
A freight forwarder, George Okafor, said the major hitch in the policy was the assessment of non-standard vehicles, whose data had not been inputted into the Customs portal, saying their duty rate is outrageous.
He said brands of vehicles like Mercedes Benz 2003 M model and BMW with 17 digits were yet to be inputted into the system, thereby, making their clearance a herculean task.
Okafor said, on the other hand, in vehicles with 17 digits, which data had been captured in Customs’ portal, there were no issues in their duty assessment.
“This high valuation of vehicles is a result of NCS trying to meet the target given it, also it is trying to plug the gap left by the 20 per cent duty drop.
“The value of Mercedes and Corolla are very outrageous, if you are on 846, they use the new template, from 2003 – 2013 the cost is about N2.8 million, as against the N390,000 – N400,000 and most owners now abandon these vehicles, even though consultations and meetings are ongoing to find a solution to this anomaly.
“A situation where the duty of common automobiles such as Golf, Toyota Corolla and Matrix has gone up from N500,000, to between N1 million to N1.3 million now, is unacceptable as it has made vehicles unaffordable for ordinary Nigerians,” he said.
The Public Relations Officer of Registered Freight Forwarders of Nigeria, Chinedun Ogoke, said the practice where vehicles of the same model, but manufactured in different countries are charged separately frightens importers. He said due to the e-valuation, a vehicle imported at N1 million attracts as much as N2 million to N2.5 million clearing fee.
“We have a situation where two different types of evaluations are used on the same type of vehicle and you find a situation where, for example, you import a vehicle of N1 million and you are supposed to clear it with N500,000. But because of valuation, you are now clearing the vehicle with N2.5 million.
“The age limit for vehicles to be imported into Nigeria is 15 years. But Customs are not allowing that 15 years. They are giving us 10 years and this is also affecting importation. Government needs to look into this,” he said.
The Secretary, Lagos State Motor Dealer Association, Olaniran Adelana, stressed that the introduction of evaluation policies and hike in duty is increasing the price of automobiles in the country coupled with the rise in the cost of spare parts.
He said to clear a Toyota, depending on the model and age, one spends up N1.3 million to N1.4 million, saying: “If you clear these vehicles at such high cost, the selling prices will increase.
“The Corolla we used to sell N1.6 million is now N2.7 million. Same with other vehicles. Everything has escalated. And since vehicles depreciate, dealers decide to sell and get their money and stop car business to go look for other businesses to invest in.”
He said many car dealers have begun to source locally-used cars in the country just to remain in business, instead of waiting for a vehicle bought from America, which takes about two to three months before it arrives and gets stuck at the nation’s seaport.
Acting President of the Association of Nigerian Licensed Customs Agents (ANLCA), Dr. Kayode Farinto, lamented that older vehicles have become more expensive in Nigeria because vehicles above 12 years old now pay about a million naira as Customs duty.
“VIN Valuation doesn’t have values for vehicle models older than 12 years and most 2008 and 2009 vehicles are largely used by Nigerian youths for Uber and other e-hailing services. The implication is that older vehicles will be more expensive in Nigeria. We want the government to review the 12-year policy on used vehicles to 15 years.
“There is also a need to review the levies on used vehicles. While we understand the government’s zeal to realise all possible earnings, it will be appropriate to reduce the levy on used vehicles from 15 per cent to five per cent in a bid to ameliorate the sufferings of Nigerians,” he stated.
Farinto also called on the Ministry of Finance to address the challenge of persistent breakdown in the operations of the National Vehicle Registry (VREG), at the seaports, which average 48 hours every week.
The ANLCA acting president noted that the VREG delays hinder the Vehicle Identification Number (VIN) Valuation system for cargo evacuation, leaving freight forwarders and their importers to suffer demurrage and additional storage charges as a result of the delays.
He warned that, if the system failures with VREG continue, ANLCA would be forced to collate the fiscal losses occasioned by the delays and institute a legal process to get compensation from the finance ministry and the technical partners responsible for VREG.
Unarguably one of the most exceptionally unique amazons ever produced by the African continent, the story of Ibukunoluwa Abiodun Awosika is intriguing in many ways. Despite being raised in a male-dominated society, she shines as a star, defying all barriers to become a global force in banking, entrepreneurship, and mentorship.
The Founder of The Chair Centre Group, former Chairperson of First Bank of Nigeria, co-founder and past chairperson of Women in Management, Business and Public Service (WIMBIZ), Awosika, is a trailblazer and an outstanding motivation to the African girl child that no barrier exists where there is a will. With a net worth of over $18.6 million, according to estimates from Forbes Africa as of 2012, the 61-year-old is worth more than her monetary value, especially when measured by the impact she’s made as an author and motivational speaker.
Awosika, a recipient of many awards from reputable global brands, was a guest on Channels Television’s Amazing Africans programme, during which she shared her journey from ordinary to extraordinary.
Enjoy some excerpts from this interesting interview!
In The Beginning…
I’m very proud of my entire experience at Methodist Girls High School. First, it was a school that had a lot of culture and a lot of values and sought in many ways to influence our minds in an all-round way. I was very active in sports. I was in the school’s relay team from my second year in school. I was pretty fast, as my friends used to call me ‘The Rabbit’. I was very involved in school plays and I used to debate to represent my school in debates and all of that. So, you had a full life; all the other things to do were fun and we were mixed backgrounds so it wasn’t just an elitist school. It was girls from every kind of home but we all got into the class because we were smart and so you learned from each other so it was a good community.
I have a quote here: ‘Seeing my drive as a young entrepreneur, my father used to say I have given birth to this one and if anything happened, he was always present to assist me even if it meant selling his house to pay up any debts’. He never discouraged you and I’m sure that had a great influence on what you felt you were capable of doing when you don’t have to go against your parents you have their full support.
I am a daddy’s girl, no doubts and no apologies. In many ways I think I had a special relationship with my dad, my siblings always say that he was a hardworking man, he believed in the value of working hard but he was also a very simple man in many ways. My father was in many ways the epitome of contentment. A man who worked hard, and pursued his goals but was happy with his estate in life and was comfortable sitting with the President and can sit the next day with the mechanic and have a gist and talk about it.
When we were young if my father’s driver was driving us to school or somewhere, you didn’t have the right to say, ‘My driver’, because you would get told: ‘You don’t have a driver. My driver doesn’t belong to you’. My dad will tell you: ‘He is my driver and you just have the privilege of being driven’.
I didn’t understand when people asked me later in my 20s: ‘Oh you did something, weren’t you afraid it wasn’t a thing that a girl could do? I didn’t understand it because I grew up in a home where we were mainly girls. My dad had mainly girls. Well, they had three boys in their lifetime and one passed and so I have two brothers and there were five girls. So, we were mainly girls and my dad never told us there was something we couldn’t do. Rather, it was about that we could do anything we wanted to do and we got all the support and encouragement to do that.
My mother was the same in many ways. She had left her Cameroonian home at a very young age, she was about 18 when she left to marry the guy she had met. I think my dad had gone on some Man O’ War thing to Cameroon and they met. She had been betrothed to another king or something; her father was the king of their community. She came to Nigeria and they got married. My dad went to England to further his education and my mom was pregnant with me. She had my brother, she was pregnant with me and was waiting to have me when my dad left for school in England and so she waited, had me, and after I think barely a year, she left my brother and myself with my grandmother and she went to join her husband in England.
You’ve described your father as ‘non-traditional’ in more ways than one. He’s also non-traditional when it comes to maybe even viewing women would you say?
In many ways. I had the liberty of expression, that’s the word I would use and I think that went for myself and all my siblings. My dad was strict in terms of values. He was strict especially because we were mainly girls but as he was strict in terms of making sure he kept us on the straight and narrow path, he was a very supportive, liberated parent in terms of expressing ourselves.
It’s not only your parents who passed on some important life lessons, your grandmother also has played a significant role in your life. Could you let us know how she also lent herself to your trajectory and success?
Well, I think my grandmother had the most influence in nurturing my early years because my grandmother was responsible for me until my parents came back from England by the end of ‘68, early ’69, when I was about 6 or 7 years old or thereabouts. So, the early years of my life were my grandmother’s to nurture. They used to call her by my name ‘cos she had only boys and I was the girl she raised. She had a little shop in our family compound area in Ibadan. My family is from the capital of Oyo State in Ibadan and my grandmother used to sell salt. She had this little shop where she used to sell salt and little things. I think maybe my first exposure to business was sitting in my grandmother’s little store and joyfully handing over products to customers.
I had things figured out so when you follow the trail, you will see just how much the hand of God played in my life you know. When I was in secondary school, I thought I wanted to become a doctor and then I found out that Medical School involved working with real dead bodies and I quickly changed my mind. It was that simple for me, I couldn’t imagine myself playing around with dead bodies so I gave up on being a doctor. Then I thought I wanted to be an architect. Anyway, I ended up in the university to study Chemistry but by the end of my first year in Chemistry, I realised I didn’t love it. I could pass Sciences but it wasn’t a love for me and I wasn’t enjoying it. So, I then thought okay I’d like to be a lawyer because everybody thought I’d make a great lawyer. After all, I used to debate so well and I thought they might just be right. I remember going to sit outside the office of the Dean of Law every day for many days until his secretary said to the man: ‘Look you have seen this young lady, she’s been coming here every day’. And then, this elderly professor, he is dead now. He asked me to come in and asked me: ‘What can I do for you young lady?’ And I said: ‘Sir, I’d like to transfer to law next session.’ The man looked at me and had a good laugh and thought: ‘I like your guts. You know if I only take one person next session it will be you but you must pass very well’. I said, ‘Yes sir’. However, that would be my problem because once you pass very well my department will never release me to him and if I didn’t pass well enough, he wouldn’t take me. I had a Catch 99 Situation. Anyway, I resolved the situation myself because by the end of the session, I changed my mind about wanting to be a lawyer. I now decided I would like to be a Chartered Accountant so I could go and work in a bank.
During my youth service, I was a very rich corper because I was very busy; I was presenting a programme on CTV in Kano. They had some commercial programmes that I used to present. I was doing voiceover and commercials. I was running aerobics classes for private clients because I was an athlete even up to my university level. So I was doing everything to open up myself and I was making money doing that.
From Auditing To Furniture-Making
When I decided I didn’t want to do the audit anymore, I came back home and when I came back I didn’t want to sit down. I had been making my own money and now I didn’t want to go back to my parents to start asking for allowances or anything so I wanted any job I could find first. So, the first job I could get was in a Furniture Company, one week after I came back from Youth Service. Now, I just wanted something to kill time I still had my eyes on going to work in the bank and I only lasted three and a half months in that company. First, I realised whilst there why I had thought about studying Architecture ‘cos all the creative part of me came alive and I realized I was in my element in terms of what I was doing there but I didn’t like the value system of the company and the way they did their business.
I realised working there that when they hired the carpenters, they came with their tools, and that the expensive machinery, there were smaller versions of them, and you could rent the use of those machines without even buying them and there are places where you go and do pay-as-you-go for them to process things for you. There were different factors of production available in this space and all I had to do was think of how to bring them together with three carpenters, two sprayers and two upholsters that was the team.
Building A Transgenerational Business
When I was 31 years old and going on 32, I had my second child. I decided then that I would like to build the business to the highest possible level but I wanted to have a life and in wanting to have a life, I made up my mind that the business must be able to survive without me and I wanted to do it in my lifetime and not when I’m dead so I decided that by 50 I was going to be out of running my business every day. By 48, I had a firm come in and consolidate all my businesses as they were into the Group and then picked people to manage the business in different levels. I have the title of CEO (but) right now I just tell them to refer to me as the founder because I don’t run the business. I have a COO who has the CEO responsibilities, running the entire business and she’ll get his title soon enough. For the past so many years now, I have kept my eye on the business. I’m responsible, I’m focused on helping them in terms of trying to identify the right strategy and if we want to get into new businesses but I’ve allowed the Group to try and find its way without me and I’ve always shunned any temptation to go back.
Why?
Because if you really want a business to outlive you it has to be able to live without you.
Bitcoin surpassed the $50,000 mark on Tuesday, marking its highest value in over two years.
Investor optimism surged as anticipation grew regarding broader trading approval in the US, with hopes riding high on potential green lights for cryptocurrency exchange-traded funds (ETFs).
Despite an initial dip following Washington’s approval signal last month, Bitcoin has rebounded impressively, boasting a 25 percent rally since January 22.
As of the latest data from Bloomberg, the cryptocurrency peaked at $50,328, underscoring the resilience and upward momentum in the crypto market, leaving observers optimistic about its future trajectory.
“Enthusiast buyers bring in more enthusiast buyers pushing prices further up,” Fadi Aboualfa, of Copper Technologies, said.
“The cryptocurrency has momentum on the back of several green weeks and has a large chance of going up further when markets see weekly movements upwards of 10 percent (as we saw last week).”
By 0330 GMT Tuesday, bitcoin had dropped slightly, to $49,950.
While Bitcoin has made an impressive recovery, currently standing above $50,000, it still lags significantly behind its peak value of nearly $69,000 in 2020. This rally signals a bounce-back for the cryptocurrency, which faced turbulent times marked by high-profile scandals and collapses within the crypto industry.
Last year, FTX, the world’s second-largest crypto exchange, suffered a dramatic downfall, with its CEO, Sam Bankman-Fried, now confronting potential consequences. Prosecutors have characterised the situation as “one of the biggest financial frauds in American history,” and Bankman-Fried faces the looming threat of up to 110 years in prison.
In November, Changpeng “CZ” Zhao resigned as CEO of Binance, the world’s largest crypto exchange, following both his and the company’s admission of guilt in extensive money laundering violations.
Bitcoin’s upward trajectory is further fueled by optimism surrounding potential interest rate cuts by the US Federal Reserve this year, as inflation appears to be easing. The cryptocurrency’s value is also influenced by an anticipated supply crunch next year, attributed to the recurring event known as “halving.”
Bitcoin, earned through intricate problem-solving by powerful computers in a process called “mining,” experiences a reduction in reward every four years. With the next “halving” scheduled for April, the limited supply dynamic continues to be a driving force behind Bitcoin’s value surge.
Microsoft joined Apple on Wednesday as a three trillion dollar company, as its big bet on artificial intelligence continued to impress Wall Street.
Now second to Apple as the world’s biggest company by market capitalization, Microsoft’s shares were up 1.31 percent at $404.
Apple remains narrowly in first place at $3.02 trillion after reaching the $3 trillion market capitalization mark for the first time in January 2022.
But it has fallen below the milestone, even briefly losing the pole position as biggest company on the markets when Microsoft briefly overtook the iPhone maker earlier this month.
Microsoft more than any other tech giant is riding the wave of excitement over AI.
The Redmond, Washington-based group has a major partnership with OpenAI, creator of ChatGPT, that is reportedly worth $13 billion.
Since the arrival of ChatGPT, Microsoft has launched several products enabling companies and individuals to use the capabilities of generative AI, notably via its Bing search engine and Copilot virtual assistant.
Since the launch of ChatGPT in early November 2022, Microsoft shares have gained some 67 percent, with Apple’s up by about 40 percent.
Microsoft publishes its results on January 30.
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