Effects Of Smuggling Of Petrolum Products In Nigeria

Of late, Nigerian  Customs Services have been fighting the act of smuggling taking place at the Nigeria’s  borders with the neighbouring countries. Smuggling of petroleum  products and  other goods out of Nigeria is a threat to local consumption of any product produced locally. Smuggling has done more harm than good to Nigerians and Nigeria as a country. The rate at which petroleum products are smuggled out of Nigeria is alarming. Smugglers always re-strategise to beat the customs officers on duty and have their ways through the borders. Yes, it was revealed few years ago, that the borders of Nigeria with other countries are so porous, that smugglers have easy escape routes to other countries. Today, petroleum products are not sufficient to sustain the internal needs of most Nigerians. If smuggling be allowed to continue without check, it will lead to severe economic crisis.
Smuggling is a serious menace to the economic development of Nigeria. It is a name synonymous with petroleum products.  Nigeria, being a major player in oil industry in the world, is seriously facing uncontrollable smuggling activities by smugglers. Inspite of the efforts of the Customs and the Immigration Services at  working hard to curtail the excesses of smugglers,  corruption in the oil sector seems to have provided a thriving ground for  smuggling activities to remain unabated. Few weeks ago, Nigerian Customs  apprehended smugglers with over two thousand Jerry cans loaded with petrol in Nasarawa State. The product was confiscated and taken to a filling station where it was sold at a cheaper rate of five hundred naira, per litre.  Some time it is difficult for seizure of smuggled products to take place because of corruption.
Smugglers are strategists who can maneuver through the borders, not minding the penalty of the offence. Activities of smugglers lead to high cost  of commodities in the markets. It gives room to quick gains, thereby giving room for skyrocketed price of  smuggled goods. Again, the activities of smugglers lead to scarcity of products that should be available in the country. The land and water border towns are where smugglers move the products to other countries. Sometimes high level compromise frustrates the combat against smuggling of products. The network of smugglers is so sophisticated to burst. Some of them are highly connected to those in authority, thereby making the war against smuggling a fruitless one. Smuggling activities are undermining even circulation of some locally produced goods in Nigeria.
According to AI overview, smuggling of petroleum products can have significant negative effects including: substantial loss of government revenue from taxes, depletion of natural resources, destabilisation of activities, fuel shortages in the exporting  country, environmental damage due to improper storage and transportation, and potential for price distortions in receiving markets due to influx of cheap smuggled fuel. Indeed, weak border control  is another  problem of poor border security and inadequate monitoring systems can facilitate smuggling activities. And another factor that promotes smuggling is price disparities. When there is a large price difference between a country producing petroleum and neighbouring countries, it stimulates smuggling.
Other social impacts; funding criminal activities; profits from petroleum smuggling often fund organised crime networks and terrorist activities. Corruption is not left out. Smuggling often involves collusion with corrupt officials undermining public trust in institutions. It is also dangerous to the environment. For instance, smuggled petroleum products are often stored and transported in substandard conditions, increasing the risk of spills and leaks, causing environmental contamination. Illegal pipeline tapping is another dangerous trend; in some cases, smuggling can involve tapping into oil pipelines, which can lead to significant environmental damage.Indeed, governments lose significant income from taxes on legally sold petroleum products when they are smuggled out. Again, smuggling can disrupt the normal supply and demand dynamics of the petroleum market, leading to price fluctuations and shortages.
It undermines fuel subsidy programme. When a country like Nigeria subsidises fuel, smuggling can exacerbate the issue by allowing people to buy subsidised fuel at a low price and sell it at a higher price in other countries Hence, there is need for the governments to combat and eradicate smuggling in the petroleum sector. Strengthening border controls; increasing border controls implementing advanced monitoring technologies and improving customs procedures can help deter smuggling. Thus, there is need for price harmonisation. Reducing price discrepancies between countries can lessen the incentive for smuggling. International co-operation is crucial to combat cross-border smuggling operations. Smuggling of petroleum products is a threat to the economic development of the citizens and Nigeria. Therefore, say no to smuggling of petroleum products in Nigeria.
Ogwuonuonu writes from Port Harcourt.

By: Frank Enewaji Ogwuonuonu