A concession agreement was recently signed between the Nigeria Customs Service Modernisation Project and Trade Modernization Project Limited, with Huawei Technologies as the technical partner and Africa Finance Corporation as the lead financiers.
The concessionaire for the automation of the operations of the Nigeria Customs Services and other technical partners have said they would be investing $3.2 billion in a venture that is expected to partly diversify the Nigerian economy and contribute to development of the non-oil sector.
In a statement that was issued yesterday, the concessionaire said the Customs Modernisation Project will fully automate the Nigeria Customs Service businesses processes, both operational and administrative. “It will usher in a new era of fully computerized and paper customs for Nigeria. This will enhance the profile of the country as a foremost facilitator of trade, an important global development practice, in line with the requirements of the World Customs Organisation (WCO)” it stated.
The Concessionaire and its technical and financial partners will invest a total of $3.2 billion to fully automate the Nigeria Customs Service, in Phase. In essence, the federal government will pay nothing to the concessionaire and its partners.
from 2022 to 2025. Other aspects of the project will be deployed in Phase 2 and Phase 3.
The concessionaire said the investment will be spent in areas that plug the current loopholes in the operational and administrative functions of the Nigeria Customs Service. “By plugging the loopholes, the consortium and the Federal Government have projected that revenue that will accrue to the Federal Government will be at least $176 billion. Clarifying this, the Managing Director, Dr. Jummai Umar-Ajijola said that this is a conservative estimate.”
Nigeria began implementation of WCO guidelines on Customs automation, but the current system deployed has now become a legacy system, that requires total overhaul, to meet new demands of the Nigeria Customs Service.
Nigeria Customs Service has said that the project will require that all its personnel become computer literate and this is a major aspect of the project. The capacity building aspect of the project, will include comprehensive training of Nigeria Customs personnel in technology adoption and deployment, including becoming certified programmers for the successful running of the project when the Concessionaire hands over.
The Customs modernisation projects are being implemented around the world as part of efforts to harmonize global trade regimes and simplify trading across borders. Many countries are complying with WCO requirements and standards and if Nigeria is to benefit from global trade expansion, the country must move in tandem with the rest of the world.
The statement said the project has the major advantage of ensuring significant growth in the revenue profile of the federal government. The project will generate in excess of $176 billion to the federal government over the life of the concession.
“The project will bring Nigeria at par with the rest of the word in the deployment of technology to facilitate international trade. The economic diversification activities of the Federal Government will receive a strong boost by providing further ease of cross-border trading,” it stated.