MAN Laments Return of FOB Levy

The reintroduction of the four per cent Free on Board (FoB) levy has continued to cause a stir in the port community, with manufacturers warning that the spike in the cost of clearing may have huge consequences for general prices, their continued operation and job creation.

In a statement yesterday, the Director-General of the Manufacturers Association of Nigeria (MAN), Segun Ajayi-Kadir, expressed concern about the reintroduction after the Federal Government promised manufacturers and importers that it had been suspended.

With the Nigeria Customs Service (NCS) claiming that it has not been officially informed about the suspension and the government being silent about its enforcement, the status of the charge is a matter of speculation.

Ajayi-Kadir said the levy would have huge consequences for the operation of manufacturers.

He also lamented about the prolonged glitch in B’Odogwu platform, which he said had rendered the process of clearing goods at the ports comatose.

He said that manufacturers had incurred losses running into billions of naira while they continue to carry heavy demurrage, just as some firms are suffering from low stock in their factories.

Ajayi-Kadir, while appealing for the stoppage of the implementation of the FoB charge, noted that the notion that the fee streamlines previous multiple charges and reduces the cost of cargo clearance was false.

The MAN DG said the FoB charge on the value of imports under the prevailing tough economic conditions is not industry-friendly and certainly not growth-oriented.

Ajayi-Kadir regretted that Customs did not dialogue with stakeholders on the new charge, and there were no clear directives regarding the processes, procedures, cost implications and compliance requirements of the FOB charge.

He noted that the charge had generated anxiety among importers while causing major disruptions in the supply chain.

MAN also claimed that the NCS is yet to conduct a proper assessment to ascertain the implications of the charge on inflation and the cost of living of Nigerians, as well as the struggling manufacturing sector.

“Most disturbing is the fact that the B’Odogwu platform is yet to be integrated with other relevant trade facilitation agencies of the government.

“This breeds inefficiency and further causes delay in the cargo clearance process, as well as promoting rent-seeking activities, all of which combine to increase the cost of doing business in Nigeria,” he said.

The Federal Government had said the National Single Window (NSW), which is expected to serve as a one-stop platform for trade facilitation, hosting all relevant agencies, would take off in the first quarter of next year.

Managing Director and Chief Executive Officer (CEO), FAE Limited, Funmilayo Bakare Okeowo, also lamented the grinding to a halt of the B’Odogwu platform, which has been on and off since June when it was re-launched.