The Comptroller of the Nigeria Customs Service (NCS), Dera Nnadi, delivered a significant paper at the Finance and Business Online Publishers Association 2024 Workshop, emphasizing the strategic importance of digital infrastructure in import duty collection and accountability. In his address, he highlighted the transformative potential of digitalization in enhancing trade facilitation and the administration of customs processes.
Nnadi noted that the ability to connect people and information has become essential in today’s economy. Governments worldwide are adapting to this technological revolution, with digitalization playing a pivotal role in improving efficiency and transparency in customs operations. The NCS has embraced various technological innovations as part of its modernization drive, aiming to streamline operations and boost revenue collection.
He defined digital infrastructure as the physical and software-based components that work together to relay information and digital products. Nnadi’s paper examined the strategic importance of this infrastructure in improving the efficacy of import duty collection and accountability. The NCS, as a central player in Nigeria’s economy, generates significant revenue through import duties, taxes, and levies, but has faced challenges such as manual processes and delays. To address these issues, the NCS has initiated several digitalization projects aimed at enhancing customs operations.
Among the key projects highlighted were the Automated Customs Processing Systems, the E-Customs Modernisation Project, the Authorized Economic Operator (AEO) program, and the Advanced Ruling System. These initiatives focus on automating documentation processes, facilitating electronic payments, and improving data management, all of which are crucial for efficient import duty collection.
Nnadi emphasized the importance of electronic payment platforms, which enhance transparency and reduce the risks associated with cash transactions. He also discussed the implementation of the Automated System for Customs Data (ASYCUDA), which has allowed the NCS to monitor cargo across borders more effectively. The Nigeria Integrated Customs Information System (NICIS) and its subsequent upgrades have further improved the efficiency of customs operations, facilitating a shift from manual procedures to paperless transactions.
The NCS Modernization Project is expected to generate significant revenue for the Nigerian government over the long term by fully automating customs operations and integrating various stakeholders in the trade ecosystem. This includes deploying e-Customs applications and systems that ensure real-time data access for customs officials, enhancing transparency and accountability in duty collection.
The AEO program, launched in August 2023, aims to enhance supply chain security while facilitating trade, rewarding compliant businesses with expedited clearance processes. This initiative relies on digital infrastructure for real-time compliance verification, fostering trust between customs authorities and the business community.
Nnadi also introduced the Advanced Ruling System, designed to provide predictability and transparency to traders regarding duty assessments, further ensuring accountability in import duty collection. By digitizing these processes, the NCS aims to eliminate uncertainties surrounding duty payments and increase compliance.
He stressed the vital role of digital infrastructure in improving efficiency, transparency, revenue collection, and stakeholder integration within the customs process. Despite the numerous benefits, Nnadi acknowledged challenges such as high initial costs, resistance to change, cybersecurity risks, and a skills deficit that could hinder full implementation.
However, he pointed to ongoing efforts to improve these digital solutions, such as expanding the use of artificial intelligence for risk management, establishing public-private partnerships, and enhancing international cooperation for better trade facilitation.
In conclusion, Nnadi reaffirmed the NCS’s commitment to leveraging digital infrastructure for enhanced import duty collection and accountability, thereby improving Nigeria’s position in the global trade community while managing the associated challenges effectively.