Port of Cotonou is the hub for all economic activities in Benin. From cotton to rice and cocoa, all are found at the harbor. Besides these, huge cargo loaded with used vehicles from Europe, the USA, and Japan is at the port. Clement Godonou, the operations manager at Grimaldi, a shipping company, says that the most imports are of used vehicles at this port. In 2010, an influx of 200,000 vehicles was reported to this port.
However, by 2014, the imports had risen to 314,000. In four years, this was a huge increase in the influx of used cars in Benin. Not officially announced. However, Benin is estimated to import more than 25,000 cars per month. The only good sight of this influx of imports is that they are not here to stay. They are further sold in the Nigerian market. However, not all vehicles are sold legally. Some even make their way to being smuggled into Nigeria. More than 80 percent is smuggled. Nigerian customs have also allegedly accused Benin’s government of directly involving this smuggling.
This smuggling is happening near the Nigerian border and half an hour from the Cotonou Port, where a row of vehicles is found, all waiting to be shipped to the other side. Several brokers and resellers purchase their desired vehicles at affordable prices from this market. A report by Mr. Stephen Golub, a professor at a reputed university, shows a large influx of vehicles from Benin and Togo shipped illegally to Nigeria. Furthermore, he demonstrated that this illegality is the high import duties most sellers want to evade.
As Nigeria has huge taxes levied upon used cars and limits to only 10 years old vehicles to be shipped, these sellers opt for the cheaper and more convenient way to sell their goods at favorable prices evading all taxes and duties. From shipping companies to the last resellers, all benefit from this market and earn handsome profits on the smuggled vehicle.
This consistent unlawfulness has forced Ecowas (Economic Community of West African States), of which both Benin and Nigeria are members, to negotiate with both the states and to implement a fixed tariff on the countries to avoid this illegality. The business being good has also attracted armed robberies being taken place at the Cotonou port. This is why the customs officials use armed forces to escort them to the border every time.
At Cotonou, the Zone-al-Madina market is more than a decade old. However, the owner Mr. Abdallah Hachim says that if Nigerians are purchasing from this market, it is because they find affordable vehicles here. He adds that Nigerians save up to 30 percent if they purchase these smuggled vehicles rather than buying them from the Nigerian market.
Another Nigerian car trader, Adeleke Adekule, says Benin has the largest automobile business. We can find all vehicles here at the best rates. This market will not diminish. On the contrary, it will grow with time as many Nigerians want cars at this rate. If this market stops, Benin will lose its competitive edge as it will not be able to provide the vehicles at the smuggled cheaper rates.