The week ahead – Offering time

President Muhammadu Buhari has asked the Executive Chairman of the Federal Inland Revenue Service, Babatunde Fowler, to explain the discrepancies in tax collected by the agency since 2015. Fowler, whose tenure expired on Saturday, was asked to explain the differences between the budgeted collections and actual collections for the four-year period from 2015 to 2018. In the query stamp-dated 8 August, the Chief of Staff to the President, Abba Kyari, said the presidency “observed significant variances between the budgeted collections and actual collections for the period 2015 to 2018.” The FIRS under Fowler never meet collection targets, a stark contrast to the trend from preceding years. The breakdown of the collections showed that 2015, FIRS set a collection target of ₦4.7 trillion but only booked ₦3.7 trillion in actual collection. In 2016, 2017 and 2018, the target collections were ₦4.2 trillion, N4.8 trillion and ₦6.7 trillion but the actual collections were ₦3.3 trillion, ₦4.0 trillion and N5.3 trillion, respectively.

Many people and vehicles were left stranded on Wednesday after the major border crossing between Nigeria and the Republic remained closed on 21 August without notice. The Seme Border, the busiest land crossing in Nigeria, was shut on 20 August following the interception of some truckloads of prohibited tramadol and codeine in Lagos on 16 August. The closure, which affected both sides, continued on Wednesday morning, with Nigerians streaming towards the country’s border from the Benin Republic hoping they would be allowed home. Traders from Benin who had entered Nigeria to supply goods in Lagos were also stranded and prevented from returning to their country by Nigerian soldiers that manned the border. A spokesperson for the Nigeria Customs Service, Joseph Attah, said that an ongoing joint security exercise has caused the disruption.

Two major-generals and a colonel who were overseeing the Nigerian Army’s 5 Brigade have been sent to the Training and Doctrine headquarters as part of the latest shuffling of commanders overseeing the Boko Haram war. The removal of BA Akinroluyo and CG Musa, major-generals, and IA Ajose, a colonel came less than a week after the brigade was attacked in Gubio, Borno. At least four soldiers were killed and a large number of weapons carted away when the insurgents entered the brigade on 10 August. The attack also left large swathes of territory without military control across Borno, the heartland of the decade-long insurgency. Akinroluyo was the theatre commander of Operation Lafiya Dole, while Musa was the theatre commander of Sector 3 Operation Lafiya Dole, overseeing northern Borno and Sector 3 Multinational Joint Task Force. The 5 Brigade in Gubio falls under Sector 3 Operation Lafiya Dole. Ajose was the commander of the brigade when it was sacked by insurgents.

17 sailors, nine Chinese and eight Ukrainian, were abducted from two ships that were attacked while they were anchored off Douala port in Cameroon. The attacks took place on Thursday, making it the latest act of piracy in the Gulf of Guinea. A Cameroonian security official said that Cameroon’s security forces had launched a search for the kidnappers. Russian news agency TASS quoted a statement by Russia’s foreign ministry saying that three of the kidnapped sailors were Russian nationals. Many Ukrainians also hold Russian citizenship. The Gulf of Guinea, whose coastline stretches in a huge arc from Liberia to Gabon, is notorious for piracy as well as oil theft, illegal fishing and human and drugs trafficking. According to Noel Choong, a spokesman for the International Maritime Bureau, one of the ships was a multipurpose German-owned ship that flew the flag of the Carribean nation of Antigua and Barbuda. The other vessel was a Liberian-flagged bulk carrier managed in Greece with a Greek owner.

Commentary

• Observers, including SBM Intelligence, had pointed out that the claims of the government of unprecedented levels of tax revenue should at best be viewed as data devoid of key context and at worse, efforts in political propaganda. President Buhari’s query, as well as Fowler’s response, affirmed this. He responded to Kyari’s letter the day after the leak, saying that the recession experienced by Nigeria’s economy in 2016 and lower oil prices affected revenue realised by the agency collections over the period in question. This opinion is in line with economic logic. The crux of the matter is this – tax revenue is a function of the performance of the many economic actors within the country and it was unreasonably optimistic to expect that metric to grow while the economy faltered.
• We wonder why a seizure of banned goods should result in a border closure, one of the continent’s busiests, no less. It is a classic case of killing an ant with a sledgehammer and is in character with Nigerian law enforcement thinking. In most cases, law enforcement believes it has to be disruptive to be seen as working, irrespective of the economic loss and social chaos such disruptions create. It is also clear that the directive comes from high up, and just like the recent presidential instruction to the CBN to restrict FX for food imports, came without a proper assessment of possible consequences. It appears there is more of an interest in pulling show of force stunts than tackling the root causes of issues, and it deals another blow to the ease of doing business drive. Nigeria needs a better approach.
• The actions of the COAS seem to be dealing more with the symptoms of the problems the army is confronting at the frontlines than with the root causes – the poor state of equipment the soldiers have to fight with, low morale, the less than ideal conditions they are fighting under, and a culture of denial as evidenced by the army’s reaction to the capture of Gubio and Magumeri on Wednesday. Both towns, multiple sources confirm, have fallen to ISWAP, but the army denies that this has happened, sparking some anger. It is not enough to demand that soldiers should stand, fight and not lose equipment to the terrorists. The soldiers have to be properly equipped and motivated to fight. The problems of poor equipment, long deployments leading to fatigue, late payment of allowances and poor conditions of service need to be sorted out to ensure that the military is on a sure footing to put up a good fight against the insurgents.
• Like we have noted in at least two previous commentaries, the Gulf of Guinea continues to be one of the most dangerous areas for maritime trade and shippers as over half of piracy attacks globally this year take place in the region. Over the last ten years, 555 incidents of piracy and armed robbery have occurred in West African waters, according to the Global Integrated Shipping Information System. In June, India, the world’s largest purchaser of Nigerian crude issued a restriction banning all Indian nationals from working in vessels in Nigeria and the Gulf of Guinea.There is now a clear economic imperative for the countries of the region to intensify and coordinate policing activities to ensure that the trade route is free of pirates.