Trade facilitation is the process of simplifying and harmonizing a country’s international trade procedures in line with current best practices and globally accepted standards. Such practices benefit all users although they can be most beneficial for agribusiness, which often deals in perishable products that need expedited clearances. When such practices are in place the importer and exporter can reliably predict shipment and delivery times and even more importantly keep border processing costs competitive. Such simple and transparent practices are particularly necessary for the successful integration of the small and medium sized agribusiness companies (SMEs) into the international arena. When trade facilitation practices are implemented, the number of players and commodities expand, competitive pricing factors are in play, and the consumer’s purchasing power increases. Reforms also generally improve tax revenues as loopholes for evasion are decreased due to the increased effectiveness of controls based on modern practices such as intelligence based risk analysis.
Trade facilitation requires a national strategy that incorporates all aspects of the trade chain but has Customs modernization as a key pillar. Action items must be prioritized taking into account the agency’s ability to absorb change and limited resources for implementation. Strong sustained political will at the highest level, sufficient technical assistance and a high degree of partnership with the private sector are vital for success.
Currently in Nigeria, the international trading process is inefficient and costly. Procedures are complex, regulations lack consistent application and fees remain high, particularly for imports. Nigeria is not adhering to WTO rules in areas such as valuation and import/export restrictions. Nontransparent valuation with continued use of arbitrary reference price lists and multiple changes in policy and procedures are obstacles to the realization of trade facilitation goals.
Although import tariffs have been reduced, levies are still among the highest in the region. The cost of compliance represents a substantial burden on the trade community. The overall import/export procedures must be simplified, redundancies eliminated, and overlapping border agency responsibilities streamlined to achieve significant trade facilitation improvements.
