The outburst over export waivers to Dangote and BUA, both gigantic cement manufacturers, has revived the debate over the imperativeness of the land border closure policy. Though reports said the ‘selective waivers’ were discriminatory, the fact that the border closure became a threat to these established companies shows how the government’s policy, imposed since August 2019, is adversely affecting diverse industries in Nigeria.
Mr Atedo Peterside, a renowned banker and businessman, brought this issue to the mainstream on his twitter handle last week. He said, “Allowing legitimate exporters and importers to move their goods across the border should be a no-brainer. Why refuse everybody else and allow only one company (Dangote)? This is why some of us argue that the Nigerian economy is rigged in favour of a handful of well-connected persons. I have since learnt that BUA Group was also allowed to export goods through Nigeria’s ‘closed’ land borders. The federal government should please accept that what is good for the goose is also good for the gander. When will the federal government consider small honest businesses that are not so well-connected?”
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At the time government closed the borders last year, it provided two objectives for its action. First, it was meant to curb the deluge of foreign goods, especially rice, into Nigeria through land borders, in order to preserve the market for locally produced rice. Secondly, the land border closure was to halt the smuggling of petroleum products from Nigeria to neigbouring countries, where they are sold at higher prices by smugglers who reap undue benefits of Nigeria’s petrol subsidy. Government had subsidized rice production so heavily that it has boasted about the country’s food self-sufficiency. Also, it claimed that in spite of increases in the prices of petroleum products, fuel was still being subsidized.
On the flip side, land border closure has negatively affected goods export, as manufacturers are stuck with jam-packed warehouses with unsold goods meant for export to neighbouring West African countries and beyond. It is for this reason that Dangote and BUA would seek government’s waivers to push the goods from their factories into neighbouring countries. As export is a crucial source of foreign exchange, the more Nigerian companies export manufactured goods, the more Nigeria earns forex to boost its economy. Viewed from this perspective, the land border closure hurts the economy more than it heals it.
Incidentally, land border closure has led to inflation and hardship in Nigeria as the cost of consumer goods has risen astronomically. Nigeria is one of the countries with the highest inflation rate in the world and this affects consumer goods in no small measure. Nigeria shares this negative economic indicator with countries like war-torn Yemen (10 per cent); Zambia (9.8 per cent); Guinea (9.47 per cent); Malawi (9.3 per cent); and Myanmar (8.63 per cent). The situation is compounded by the devaluation of the Naira and the constant jerking up of the prices of petroleum products, which have spread hardship widely across Nigeria’s social strata.
In view of the negative consequences of the closure of land borders, we call on government to reverse the policy and reopen them. What is required of government is to equip the Nigeria Customs Services to conscientiously carry out their responsibility of policing our land, air and sea borders. Government cannot inflict hardship on Nigerians simply because an executive arm has failed to perform its constitutional roles in securing the country’s borders. Apparently, it is time to modernize the NCS and ensure that they use technology in manning and protecting the borders.
It is shocking that in spite of the closure of land borders, bandits, kidnappers and terrorists enjoy a thoroughfare, entering into Nigeria at will, abducting vulnerable rural population, negotiating ransom, collecting them, and repeating the circle of criminality again and again, without being stopped. Also, the policy has not halted the activities of smugglers who have continued to defy the Customs and Immigration to import contraband items and sell at exorbitant prices in Nigeria.
No doubt, the continued closure of our land borders is senseless and self-destructive. It is time to re-open them.
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