• Tuesday, December 05, 2023
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Businesses groan as checkpoints, illegal tolls on roads inflate cost

Explainer: Why inflation is cooling “everywhere” else but Nigeria

For Itunu Shonibare, a Lagos-based truck owner, the trucking business is becoming less attractive due to the illegal tolls collected by security operators and louts, popularly known as ‘agberos’, who extort truckers at checkpoints mounted on the Apapa and Tin-can Island port corridors.

Despite the Federal Government’s Ease of Doing Business policy and the use of an electronic call-up system, known as ‘Eto’, to batch port-bound trucks, Shonibare said her drivers and other truckers that transport goods from the port to importers’ warehouses in different parts of the country are forced to give money to security officials and miscreants that mount over 15 checkpoints from Fagbemi at the Mile 2 Festac side to Tin-Can Port.

“There is a checkpoint at Fagbemi where truckers pay N2,000; at Mile 2 Bridge, we pay N4,000 and N2,000 to police; at Auto Wharf, we pay N2,000; UBA, N2,000; Kirikiri Bridge N2,000; IRS N2,000; MTN, N2,000; before Sunrise, N2,000; Westminster, N2,000; Trinity, N2,000; Coconut, N2,000; on top of Coconut Bridge, N2,000; Down Coconut Bridge, N2,000, and this checkpoints are located up to the Tin-Can Island Port,” she said.

According to her, export containers pay over N30,000 across the checkpoints before accessing the port and this is one of the reasons goods imported into and exported from Nigeria are expensive.

Just like Shonibare, many businesses that depend on importation for their critical production inputs are facing serious financial pressure due to the illegal tolls paid on the roads and within the port environment.

This was confirmed by Segun Ajayi-Kadiri, director general of the Manufacturers Association of Nigeria, who said the cost of importing a 40-foot container from Singapore to Apapa is virtually the same as taking it from Apapa to Agbara (about 27 kilometres) and it will take weeks to clear.

Osaretin Victor Asemota, who recently carried out a study of logistics for agricultural produce on the Accra, Lome, Cotonou, and Lagos corridor, said on his Twitter handle, @asemota, that he discovered that anything coming into or going out of Nigeria bears more cost, which is why most merchants would rather ship abroad even with a massive Nigerian market nearby.

“The last time I travelled between Accra and Lagos by road, half of the time was spent between Seme and the airport in Lagos. I almost missed my flight because of checkpoints and traffic. It is insane. Nothing is optimised,” he said.

Asemota pointed out that there is no way Nigeria will make any progress without all these issues being addressed.

“We can’t keep consuming forever without producing. The effect is what we are seeing with our economy and currency today. The smaller countries stand a better chance,” he added.

On the Apapa Port corridor, BusinessDay discovered that truckers pay illegal fees at the checkpoints at Total Bridge, Ijora-Olopa, Iganmu, Sifax, Area B, and others, despite having valid electronic call-up tickets.

A number of haulage operators have complained about having to pay their way in and out of the port.

Also, the problem of delay mostly experienced when the cargo leaves the port has reduced since the Port Standing Task Team (PSTT) started the ‘Operation Clear the Port Corridor’ but the problem now rests on the cargo that are going to the port including export, empties and empty trucks.

It also discovered that to move a 40-foot container from Apapa to warehouses in Lagos costs between N700,000 and N750,000, while it takes between N300,000 and N400,000 to move a 20-foot container from Apapa to warehouses in Lagos.

Sharing his experience, Joseph Umoh said on his Twitter handle, @umohjoe, that a 40-foot container from the United Kingdom to Apapa costs £5,000; Hamburg to Apapa costs €4,500, while China to Apapa costs between $2,500 and $3,000.

“Clearing and documentation of a 40-foot container out of Apapa or Tin-Can Island Port will be about N8 million, depending on the nature of the goods, while a 20-foot container costs between N6 million and N7 million, depending on the goods,” Umoh said.

According to him, checkpoints do not only exist on Lagos roads as there are 16 checkpoints between Lagos and Abuja, and once the container leaves Apapa, there is an agreed amount to be paid for a 40-foot container and a 20-foot container at each checkpoint.

Umoh, who pointed out that he has five 40-foot containers on their way to Abuja from Apapa, said the amount to pay is non-negotiable.

“At the end of the day, the importer ends up spending two times the amount used to source goods and freight costs between Apapa Port and the destination within Nigeria,” he added.

Read also: Things to know about vehicle inspection, roadworthiness certification in Lagos

Olisa Nwosu, with the handle @OlisaNwosu, said the endless checkpoints probably add at least 20 percent to the cost of agricultural produce.

“I was on a trip to Taraba recently and saw the staggering number of Army and Police. On the stretch between Abakaliki and Ugbema, a distance of 209 kilometres, I counted up to 50 checkpoints,” he added.

Olawale Salami, another Twitter user, lamented infrastructural deficit, power challenges, multiple taxation, business registration problems, absence of single window clearing at the port, and poor road network, among others.

Moses Fadipe, national coordinator of the PSTT, which is in charge of clearing the Lagos port corridors, said the majority of the people behind the checkpoints from Fagbemi at Mile 2 to the Tin-Can are non-state actors, especially members of the different associations at the port.

He said members of the security department of the Nigerian Ports Authority (NPA) only operate at the port gate.

“From Apapa Port to Ijora SIFAX to Orile up to the Mile 2 through to Sunrise down to Tin-Can, we see state actors intermittently. But the Police, NPA, and LASTMA join to ease truck movement along the port corridor. More importantly, we cannot remove Police from the road because they are responsible for crime control,” he said.