Cargo Diversion: Nigeria loses N130bn annually to neigbouring countries

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Considering its size, population and other economic resources abound in its maritime space; unarguably, Nigeria is assumed to be the preferred and the hallmark ports in West and Central Africa.

In spite of its numerous potential, today, Nigerian ports are losing about N130 billion annually to cargo diversion to neighbouring ports. This loss translates to an estimated N650 billion in five years due to challenges such as the absence of cargo scanners, high port cost, inefficiencies and low channel draft, which inhibited the growth of the nation’s seaports and denied it hub status in the West and Central Africa.

To worsen the situation, land locked countries such as Chad and Niger Republic, have dumped Nigerian ports as their transit points and diverted their cargoes to Nigeria’s neighbouring countries of Ghana, Togo and Benin Republic due to delay in cargo clearance and inaccesible port access roads.

Daily Sun learnt that Nigerian ports have highest berths in West and Central Africa. For instance, Apapa Port alone boasts of over 20 berths while Benin Republic and Togo ports have average five berths respectively.

Despite Togo and Benin Republic’s relatively possessing five berths, their cargo clearing process is more efficient, which takes a few hours compared with Nigeria where it takes weeks even months to clear cargoes out of its ports. This is one of the reasons majority of importers diverted Nigerian bound cargoes to these neighbouring countries.

Though the statistics of the Nigerian Ports Authority (NPA) showed that Nigerian ports recorded 78.4 million metric tonnes of cargo imports in 2020, the nation’s seaports still lose transit cargoes of landlocked countries to neighbouring ports.

However, despite recording more throughput than its contemporaries, Nigeria recorded a decrease in the number of cargo throughput and vessels that called into the nation’s ports in 2020.

Speaking with Daily Sun, Advisory Head/CEO, Kamany Marine Services Limited, Charles Okorefe, said: “The reasons cargoes are being diverted are not far-fetched. How users friendly are Nigerian ports in terms of tariff, port charges and port cost when we are talking about the actual statutory port cost that is supposed to pay when you are handling cargo. Customs duties, terminal and shipping terminal charges and all of them are part of the problem.”

He said importers incur other extraneous cost and restricted charges and other costs, adding that Nigerian ports are not users friendly, as no importer wants to make losses with their business and everybody that goes into business has eyes for profits. He said in a situation where importers are being shortchanged when they bring in cargo and sometimes, they even paid more than the cost of bringing them in; losses are bound to occur.

“And you found out that the ports in Lome and Ghana, cargo handling, port cost and even their tariffs are relatively low while Nigeria tariffs are among the highest in the world, which is true. In such case, if an Importer has alternative, they will definitely use it,” he said.

He explained that the remedies for the cargo diversion is for Nigeria to go back, look inward into the system, adding that it is over 16 years now that the ports were concessioned and there is need to review what the terminal operators have done to improve the efficiency.

Meanwhile, the National President, National Council of Managing Director of Licensed Customs Agents (NCMDLCA), Lucky Amiwero, said said that cargo diversion is being caused by the nation’s port that is not friendly, saying the port is not friendly in the sense that it is very expensive to bring cargo into the nation’s ports.

“Well, I’ll continue to say it when our ports are not consistent, predictable and not transparent. These are the three key issues that make a modern and preferred port. When a port lacking those features, that port is at disadvantage in terms of cargo throughput.

SOURCE: THE SUN

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