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As informal cross-border trade alone is estimated to account for around 20 per cent of Nigeria gross domestic product (GDP). The borders are also an important source of livelihoods for women, who constitute a major proportion of cross-border traders. In the western and central parts of Africa, 60 per cent of traders who use border access are women. The main traded items are vegetable oil, household items, rice, and other agricultural produce.
Nigeria has four major land borders and these borders lead to four African countries. The country shares borders with Cameroun in southern part in Cross-Rivers. It also has a border with Chad in North-East in the North. Nigeria also has a border with Republic of Benin in the southwestern part of the country.
In Southwestern Nigeria, Seme border is named after the Nigerian border town that links the country to other West African countries via Republic of Benin. It is seen as an important trade channel for better regional integration within the Economic Community of West African States (ECOWAS).
This is because of the prominence of Nigeria, which, with its immense and steadily growing national consumer market, is becoming an attractive trade partner for neighbouring countries.
Most of these countries generate the bulk of their foreign exchange through transit and re-export, thereby creating a large and lucrative market, despite their geographic disadvantage. For Nigerian traders, on the other hand, the Seme border provides access to regional markets to trade agricultural products and locally made fabrics, among other products.
Due to its porousity, Seme border is also a major crossing point for immigrants entering or leaving Nigeria illegally, and for smugglers of marijuana and other illegal goods.
The Seme border is notorious for smuggling of all sorts of goods and human trafficking of Nigerians seeking greener pasture in Europe. Also, West African children recruited to work for low wages on plantations in Central Africa are transported through this border.
In recent time, the border has also become a bedlam of violence between the smugglers, officials of the Nigeria Customs Service, including other law enforcement agents along the road.
CRUX OF THE MATTER
Miffed by the activities of unrepentant smugglers who ply their illicit trade from different border towns, including Seme, the Nigerian government ordered the closure of the border on Wednesday, August 21, after some truckloads of prohibited tramadol and codeine were intercepted in Lagos on August 16.
Subsequently, the Nigerian government announced the commencement of the joint exercise by the security agencies to further secure the land borders across the country. The operation, which is being coordinated by the Office of the National Security Adviser (ONSA), takes place in the four geopolitical zones of the country, including Southsouth, Southwest, Northcentral and Northwest.
The joint security operation called Ex-Swift Response involved the Nigeria Customs Service (NCS) and the Nigeria Immigration Service (NIS) in collaboration with the Armed Forces of Nigeria (AFN), Nigeria Police Force (NPF) and other security and intelligence agencies.
FALLOUT OF THE CLOSURE
Expectedly, with the tighter border surveillance nationwide, Nigerians and others doing businesses in West Africa main commerce corridor have continued to count their losses just as the unwholesome security measures been taken by the government has stalled business deals with other neighbouring countries.
Investigation revealed that prices of rice and other commodities like groundnut oil have jacked up just as perishable items worth millions of naira are currently rotting away as fully armed security agents on constant patrol halt all sorts of movement across borders.
GAIN AND PAIN
In trying to articulate the solution to the smuggling issue at Nigerian borders, simply closing the border does not address the problem. There are issues to be considered in finding a solution to the preponderance of the smuggling of goods.
Although the closure does not affect Nigeria oil exportation, which is conducted almost entirely through the nation's ports and offshore oil platforms, it would most likely affect the economy in terms of inflation, especially in food prices.
Nigeria relies heavily on imports to feed its booming population of over 200 million. Traders and consumers will be largely affected and this would consequently lead to an increased cost of living for Nigerians.
Food items such as rice, tomatoes, apple, frozen foods, and sugar are bound to become more expensive for consumers. While it was illegal to bring these items into the country via land borders even before the border closure, they had often been smuggled.
As for rice, the country's agriculture lobby is loudly supporting the border closure.
Benin imports 1.2 million metric tons of rice annually, against the backdrop of its population of about 11 million people.
This is seriously threatening Nigeria's domestic rice production, which has unprecedentedly spiked with the Central Bank of Nigeria's rice Anchor Borrowers Programme.
As one bright spot in the economic recovery effort, it has helped official rice import from Thailand to plummet from 644,131 metric tons to 20,000 MT annually, as of 2018, said the Minister of Information, Lai Mohammed.
Ade Adefeko, a senior executive in charge of corporate relations with the food giant Olam, said investment in Nigerian agriculture was being hamstrung by the rice trafficking, which is estimated to reach two million tonnes a year.
Olam has the biggest rice-growing business in Nigeria, owning 13 000 hectares (30 000 acres) of cultivable land of which only 4 500 hectares are being used because the sector is not profitable in the face of competition from Asian rice, he said.
But since the border closure, locally-milled rice has started selling, and the entire rice value chain has been positively impacted by the closure, Adefeko said.
He called for the border closure to be maintained until the end of the year, and see how it goes on a longer term.
Undoubtedly, the closure has opened Nigeria's eyes to new economic realities.The authorities have vowed not to reopen the borders until the affected countries learn to conduct themselves responsibly and in line with the principles that undergird the ECOWAS protocol on free movement of goods and services.
The customs chief Ali told reporters there was no time limit¦ It will continue as long as we can get the desired results.
But if the border closure is a boost for domestic growers, it has led to price increases for consumers.
The price of a 50-kilo (110-pound) bag has more than doubled to 20 000 naira, roughly the entire monthly income of a Nigerian living in extreme poverty ” of whom there are an estimated 87 million in the country.
Traders in Lagos Island, a vast market of Made in China textiles and gadgets, say the closure of the borders had crimped supplies via Benin's Cotonou.
Lagos port is too slow and you have to pay too many bribes to get your goods out,said a swimsuit hawker. I have to cut down my margin by half.
The annual inflation rate has edged up to 11.24% in September, while food inflation ran at 13.51%.
FILLING A ROLE
A similar complaint is heard among people in Nigeria's industrial sector, which is already struggling with the country's notoriously poor transport system and electricity shortages.
Trade with neighbours is essential, they say.
The intention of stopping smuggling is praiseworthy but the point is that measures have an impact on us,said a foreign investor who specialises in the import and export of manufactured goods.
As usual in Nigeria, it's all down to a question of strength”you crush first and talk later.
Between 10 and 20% of Nigerian manufactured goods are sold to other countries in West Africa, with many of these items, such as pasta and cosmetics, exported through informal routes, mainly through small sellers who travel around the region.
We need direct investments, we need industries to create jobs in this country, said Muda Yusuf, director of the Chamber of Commerce in Lagos.
Some people can celebrate but while they put their money to the bank, the rest of the people are suffering.