Nigeria Loses $23.6bn over Non-Monitoring of Crude Export



IN the last 20 months, Nigeria has been exporting its oil and non-oil products without documentation. As result, the country lost a whooping sum of over N23.6 billion expected to be repatriated proceeds of the export within the period.

These revelations were made on Monday, February 20, during an investigative public hearing organised by a Joint Committee of the Senate Committees on Finance, Trade and Investment, Gas, Petroleum Upstream, Banking, Insurance and Other Financial Institutions, Judiciary, Human Rights and Legal Matters, and Customs, Excise and Tariff.

In addition to this loss, the Senate also alleged discovery of over $850 billion supposedly earned by the country between 1996 and 2014 from its crude oil export proceeds, which was not repatriated to the country by the Joint Venture Companies, JVCs.

The red chamber noted that these developments were in total contravention of Nigeria’s Pre-Shipment Inspection of Export Act and Article 26 of Export Policy Guidelines and procedures for crude oil, gas and non-oil goods.

The theme of the public hearing was “Need to Investigate Pre-Shipment Inspection of Export Activities in Nigeria.” The public hearing was prompted by a motion moved on the floor of the Senate by Senator Abubakar Yusuf (APC, Taraba Central) in July 2016, where he alleged that there had been gross violation of the Pre-shipment Inspection of Export Act by certain institutions of government.

Usman Ndanusa, deputy director in the federal ministry of trade and investment, who represented the ministry at the investigative hearing, posited that the country had, since June 2015, been exporting its oil and non-oil products without measurement and documentation.

He said the development was sequel to the disengagement of pre-shipment inspection agents at the various export terminals in the country and their subsequent replacement with agents who were merely asked by the federal government without legal and constitutional backing to carry out the pre-shipment work at the terminals.

The development, he noted, left the country at the mercy of the agents. He also disclosed that the country had no control of measurement of its oil and non-oil export commodities, noting that most of the terminals across the country had no comprehensive metering systems.

Declaring the public hearing open, Senate President, Bukola Saraki, noted with dissatisfaction the refusal of the JVCs to repatriate crude oil export proceeds of over $850 billion between 1996 and 2014. He warned the companies against flouting the laws of the country, stressing that those found wanting in the development would be made to face the wrath of the country’s law.

“It is, therefore, worrisome as revealed in the motion that the Joint Venture Oil Companies have refused to repatriate crude oil export proceeds of over $850 billion between 1996 and 2014 which is in total contravention of the Pre-shipment Inspection of Export Act and Article 26 of Export Policy Guidelines and procedures for crude oil, gas and non-oil goods. If the country is good for doing business, it simply means the laws of the country must also be respected. Whoever is found culpable will be brought to book, no matter how highly placed, because the monies involved is enough to tackle the infrastructural challenges all over Nigeria.

“Section 11 of the Pre Shipment Inspection of Export Act clearly states that “an exporter of goods, including petroleum products, shall open, maintain and operate a foreign currency domiciliary account in Nigeria into which shall be paid all exports proceeds corresponding to the entire proceeds of the exports concerned. It is the responsibility of the Central Bank of Nigeria to monitor the repatriation of all export proceeds.”

The President of the Senate, while noting that Nigeria was faced with challenging economic recession at the moment, charged senators to do everything necessary to sanitise the system.

In his remark, Senator John Enoh, chairman of the Senate Committee on Finance, who was also the chairman of the joint committees, said the hearing was pursuant to the mandate of the Senate to carry out a holistic investigation on the pre-shipment of exports activities in Nigeria. The committee is expected to come up with recommendations that will strengthen Senate’s operations and capacity with positive impact on the national economy.

— Mar 6, 2017 @ 01:00 GMT


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