For Nigerian seaports to compete favourably among its contemporaries in West and Central Africa, it has to deploy modern trade facilitation tools like the suspended international Cargo Tracking Note (CTN), YUSUF BABALOLA writes.
Since the stoppage of the re-introduced international Cargo Tracking Note (CTN), by the Minister of Transportation, Rotimi Amaechi, Nigeria has been losing about $20 million annually that would have accrued into the coffers of the federal government.
The CTN scheme was conceived following the 9/11 terrorist attack on the United States of America, which led the International Maritime Organization (IMO) to introduce a security framework for enhancing the protection of international shipping and the prevention of the movements of dangerous cargo and arms shipments in all the maritime regions of the world.
The system, with numerous advantages such as plugging revenue leakages, putting end to under-declaration of cargoes, importation of arms, ammunition, banned drugs among others, was even at no cost to shippers, importers, governments and shipping lines.
How Sierra Leone Nipped Corruption With CTN
For instance, in Sierra-Leone, the government generated $4.1 million from February 2019 from the re-introduction of CTN at the nation’s port operation after the Sierra Leone Ports Authority (SLPA) aligned with the business software solution licenced from Domineum Blockchain Solutions Ltd.
This international CTN deployed by Domineum Blockchain Solutions Ltd is helping the port authority increase security measures, sanitise the business climate of Sierra Leone ports and also increased compliance to contractual terms, without prejudice to the provisions contained therein.
Prior to the engagement with Domineum Blockchain Solutions Ltd, the government and the Sierra Leone Ports Authority carried out an investigation which discovered a revenue shortfall of $11 million (95 billion Leones) between 2015 and 2019 from the contract handled by Transport and Port Management Systems-West Africa Sierra Leone (TPMS-WASL) due to lack of monitoring and operation of a syndicate opposed to government efforts to development and stability.
The actions Sierra Leone President, Dr. Julius Maada Bio and the SLPA havs hoover, increased investors’ confidence, local trust, and government revenues. These actions are also a bold harbinger of the intention of the government to bring change, trust and prosperity to the people of Sierra Leone, the Sierra-Leonean government said.
Nigeria Missing In West And Central Africa
However, stakeholders in the Nigerian maritime industry have also urged the federal government to re-introduce the international CTN to benefit from the numerous opportunities inherent in it.
They opined that Nigeria is the only country among its competitors in West and Central Africa missing in the implementation of the automated system.
The director, Consumer Affairs Department of Nigerian Shippers’ Council, Cajetan Agu, said Nigeria’s competitors such as Senegal, Cote d’Ivoire, Angola, Congo, Cameroon, Benin and Togo have also deployed international CTN to plug revenue leakages in port operations.
He said that it was left for the country to compete with the neighbouring countries in the sub-region or perish, declaring that the re-introduction of CTN would curb the massive influx of illegal arms and banned drugs into the country. Agu, who insisted that CTN would plug revenue leakages, added that it would stop the under- declaration of cargoes by importers and clearing agents.
The Shippers’ Council director who represented the Executive Secretary, NSC, Hassan Bello at a stakeholders meeting on the planned re-introduction of the automated system at the nation’s seaports, said that the “Option is left for us to implement best practices, compete and survive or perish. The purpose of CTN is to check under-declaration, plug revenue leakage, improve security, generate statistics for informed decision-making, and assist the Nigeria Customs Service (NCS) in the profiling of cargo and shippers.
“It will also help to monitor the freight rate trends on major trade routes. During the World Trade Organisation (WTO) round of negotiations, the African groups were in favour of ICTN. NSC believes in best practices. We believe the project will turn around the fortunes of the maritime sector.
He said “Anybody who wants to criticise the system should come up with clear points on why it should not be implemented. Generally, Nigeria has phobia for automation. ICTN is an automated system just like Single Window. He further explained that CTN also called Advance Cargo Declaration in the USA was first introduced post 9/11 attack to forestall the importation of dangerous cargo.
Agu added that the system subjects all cargoes destined to America to a declaration at origin, name, nature, volume, value, origin, freight paid, the consigned addresses and telephone number.
Enhancing Supply Chain, Maritime Security
Similarly, the director of training, Council for the Regulation of Freight Forwarders in Nigeria (CRFFN), Alban Igwe also described the CTN as a security system that will stop importation of unwholesome cargoes into the country, noting that it has the potentials to reduce the entire time spent along the supply chain and also reduce the hassles various stakeholders have to pass through.
He said, “The CTN is a very useful instrument especially now that we are in a terrorist regime as there is crisis all over the world today. We cannot afford to ignore anything that will enhance maritime security and beyond maritime we are looking at the supply chain security.
“The CTN has the potentials to reduce the entire time spent along the supply chain and this also reduces the hassle that various stakeholders have to pass through. Even anxiety can be a big problem by causing a lot of delay.
“But if we can attain a level of accuracy to predict by having a profile of every shipment, it expedites the way we handle things and the process enhances the turnover which brings immense benefits in business in general terms.
“So, we ought to know what CTN is, we ought to know the objectives of this CTN. The objective is to improve the security and safety of supply chain and help us see the profile of products we are bringing in.
“It will help us know the origin and destination of cargoes and help us know our enemies. Our enemies may be far away and stockpiling, with the CTN we are able to fish out these anomalies. I think the CTN’s re-initiative is a welcomed development,” he said.
Igwe who is also the deputy national president, Chartered Institute of Transport and Logistics (CILT), further stated that the CTN like the shipping Act of the United States, strengthens internal security and transmission of data and documents to Customs and port authorities before the arrival of the vessel.
Trade Facilitation
He said it simultaneously strengthened security, reduces fraud, and facilitates trade. The electronic CTN is in line with the spirit of World Trade Organisation’s (WTO) trade facilitation, because of the almost instantaneous transmission of data and documents to customs and port authorities of the destination country, well before the arrival of the vessel, according to the CRFFN director.
He remarked that the Nigerian Shippers Council has started well to engage a number of stakeholders, although, there is more work to be done to ensure that this CTN initiative succeeds this time.
“The fact that the system failed and was cancelled five years ago should give the Shippers Council some warning signs. Shippers Council should put all diligence to ensure that this noble cause of the CTN is achieved.
“I can say it is a noble cause because I have done some research, read and studied the CTN. We must make sure we douse every contrary opinion with evidence and this means we must make sure we do in-depth research and ensuring the CTN is electronic and educating the stakeholders.
According to him, the freight forwarders and custom brokers must be carried along sufficiently so that we can have a smooth sail. “I think the NSC is on track and with regards to the timing; there is no better time to reinitiate the CTN than now.”
Need for Inter-agency Cooperation
Stating the benefits, he said, the benefits of the CTN include Asset Tracking, On Board Status monitoring, Gateway Facilitation, Freight Status information, Network Status information, etc.
Igwe advised that it is paramount that the Nigerian Shippers Council ensures a degree of collaboration amongst key stakeholders such as Nigeria Customs Service, Nigeria Ports Authority, Standards Organization of Nigeria, Nigeria Manufacturers Association of Nigeria, the Import and Export community as well as freight forwarders to effectively implement the CTN.
The CRFFN will be positively disposed to facilitating a round table early this year towards achieving this noble objective, he said.
Other Benefits
A clearing agent operating at the Onne port, Port Harcourt, Rivers State, Chukwudi Henry has said that the CTN will uncover the alleged fraudulent declaration of vessels dead weight tonnage by some international shipping companies so as not to pay the correct three per cent gross freight rate due to the Nigerian Maritime Administration and Safety Agency (NIMASA) and pay the Nigerian Ports Authority (NPA) the correct pilotage service fee.
A dead weight tonnage (DWT) of a vessel according to him, is a measure of how much mass a ship is carrying or can safely carry. And therefore, it is an important determinant of how much of the three per cent gross freight rate that the Nigerian Maritime Administration and Safety Agency (NIMASA) collects and that of other services NPA renders to them on call at the nation’s ports.
He said, “So, the correct dead- weight tonnage of the vessel can only be determined by tracking and so the CTN will be able to determine the exact dead weight tonnage of vessel. You cannot alter this. Now, they only estimate the value and so it is subject to manipulation.
Anybody can short-change the government by giving any figure which is not accurate. But with CTN, accuracy of the vessel dead weight tonnage is determined from the port of origin on sail.
“In the past, federal government was losing huge revenue from this. The shipping lines connive with government officials to underpay the government. So, CTN guarantees transparency because it tells you what the vessel is coming with,” added Henry.
