Nigeria is the largest economy in Africa with an estimated population of 200 million people, land area 923,768km square, coastline 853km, Income per capita $2,250, road network 195,000km. It has six (6) ports namely Apapa and Tin Can in Lagos, the Onne and Port-Harcourt port, Warri port and the Calabar port and has a very productive young population of 60 percent aged between 15 and 65 years.
It is the world’s sixth largest oil producer (largest in Africa) with GDP of $446.543 billion in 2019 and has over 300 square kilometres of arable land and significant deposits of largely untapped minerals. Seaports play a fundamental role in the development of trade and economies of nations as around 80 percent of global trade are transported by commercial shipping, where maritime trade accounts for nearly 25 percent of global traffic volume.
The sector serves as the gateways and transit points through which imports and exports flow in Nigeria is a very critical element for the nation’s economic success because they provide access to markets, support supply chains that helps link-up consumers and producers. It is a very strategic sector to the Nigerian economy and has over 80 million people daily that relies on it.
The Nigerian Ports Authority management declared the sum of N67.19 billion for three months that ended March 31, 2019, representing 24.8 percent of the N270.56 billion earned in 12 months ending December 31, 2018. It declared N299.56 billion as revenue generated for 2017 fiscal year exceeding its 2016 figures of N162.20 billion by 84.65 percent. In 2013, it generated the sum of N154.50 billion, it increased to N159.30 billion and N180.50 billion in 2014 and 2015 respectively, its revenue, however, dropped to N162.20 billion in 2016
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Global trade facilitates economic development and so many countries including Nigeria must take advantage of this linkage by reducing or eliminating obstacles that can affect the movement of goods and trade transactions through its ports. The sector urgently needs to leverage the economic benefits of using digital technology to drive excellence across all its areas of operations and management to add more value and increase its market share.
There is overwhelming evidence that the majority of ports around the world have leveraged the adoption of modern digital technology to drive higher performance of their ports. Some examples of ports globally that used the advantage of this technology to boost remarkable results are Port of Rotterdam, Antwerp Port, Port of Shanghai, Port of Singapore etc.
In 2019, the transportation sector in Nigeria increased its GDP from $642.927 to $720.241 million. The nation’s port played a significant role in this achievement. In 2017 a World Bank Indicator that promotes trading across borders measured after assessing different ports globally ranked Nigerian Ports at 183 out of 185 countries. It also classified Nigerian ports among the worst ports in the world due to lack of modern technology, infrastructural deficits, poor planning, Port managerial challenges.
Some examples of the corrupt practices in Nigerian ports are undervaluation of the exact cargo tonnage and non-declaration of actual cargo by shippers, fake freight forwarders and shipping agents in the ports. These were all responsible for its challenges such as low patronage, congestion, low -turnaround time, environmental and sustainability challenges, safety issues, insecurity and corruption (Corruption perception Index 2019 of Nigeria 146th out of 198 countries with a score of 26/100)
The high corruption rate in the ports are responsible for why Nigerian government’s projection to generate $5.8 billion from the maritime industry cannot be achieved which can be blocked through the adoption of modern digital technology systems.
The high corruption rate in the ports are responsible for why Nigerian government’s projection to generate $5.8 billion from the maritime industry cannot be achieved which can be blocked through the adoption of modern digital technology systems.
Nigerian ports should fully adopt the use of digital technology applications such as the internet of things (IOT) to accelerate the exchange of data and information across all areas of the ports. Also, the use of automated technology to increase efficiency, artificial intelligence (AI) to monitor and gather information to quickly adapt to changes capable of affecting the efficient operations of the ports should also be used and sensor technology which will help in the areas of safety and security at the ports.
In addition to improving security at the ports the use of cameras with integrated biometrics software, use of smart ID card, face scanner, facial recognition technology, cameras with integrated biometrics software should also be used to improve security which would help checkmate activities of touts, unwanted persons and vehicles within and outside the proximity of the port which would help drive greater efficiency and remove congestion and traffic gridlocks at the port
It is very important that Nigerian ports must develop a competitive edge for it to achieve greater success. It must maintain and implement digital and smart-port technologies for it to be more productive, customer-friendly, efficient, profitable and competitive. Successful ports globally have all leveraged on the adoption of digital technology to increase their value and market share, examples are cloud-based services, mobile devices and apps, sensors, Internet of things technologies, augmented reality, autonomous transportation, blockchain technology, automation, artificial intelligence AI and big data.
Internet of Things (IoT) represents a convergence between physical and digital worlds, ultimately using data as a source of value which can be applied in diverse settings from transport optimisation to warehousing and transport management systems, all these developments are accelerated by a centralized networks system that relies on distribution and analysis of information. Some examples of ports transformed by digital technology application are Rotterdam ports, Port of Antwerp, Port of Singapore and Port of Shanghai in China, the largest and busiest port in the world.
The Port of Singapore is the second, both ports are the busiest in the World in terms of cargo tonnage and it is not surprising that Port of Shanghai handled 744 million tonnes of cargo in 2012 including 32.5 million twenty-foot equivalent units (TEUs) of containers, it comprises of 125 berths with a total quay length of about 20km and serves more than 2,000 container ships on a monthly basis, the port accounts for a quarter of China’s total foreign trade.
While ports play a central role in the movement of cargoes across the nation as well as in transport and logistics sector, it needs to constantly innovate to provide more value-added services that can boosts ports efficiency and productivity and therefore needs to be fully digital in order to achieve greater productivity, efficiency, flexibility, increase in data and information sharing, better coordination, collaboration, sustainability, security etc. All these in place would make Nigerian ports to be more competitive, be more attractive, profitable and help increase its market share.
If Nigeria, can adopt and implement digital technology to drive the management and operations of its port it would triple its current output (Container port traffic TEU: 20-foot equivalent units) in Nigeria was 1,210,000 in 2018. This would make it increase its market share and also gain a competitive advantage in areas such as better operational planning and management of the port. It will also make Gateways at the port to be more secured and safer with the help of sensors, CCTV and other entry control systems.
It is important for Port managers to urgently work on modalities that will put in place digital technology system that can provide ship/shore interface, maritime intermodal interface, provision of modern facilities for berthing, faster anchoring of ships, modern equipment for the transfer of goods and containers from ships, pilotage, faster support services for cargoes, shippers, ships and a base for industrial development centred around the activities of the port, freight and movement of goods.
Be it intra and inter-organisational activities it is key that Nigerian ports implement and adopt the use of modern digital technology to drive and optimise the performance of the ports. This is because most port stakeholders complain a lot about high costs of shipping goods to Nigeria, they feel this does not correlate with the distance because shipping goods from New York to Nigeria which is nearly double the cost of shipping to South Africa even though Nigeria is closer by nautical miles to New York compared to South Africa.
In 2019, Nigerian lawmakers in the house of representatives commenced investigations on the huge loss of approximately $2 billion monthly revenue at the nation’s major ports Apapa and Tin Can Island Ports. Major part of some of these losses of revenue was traced to lack of a well-structured digital port which will help monitor and also block some loopholes in the system as well as streamlining and providing real-time information exchange across the various departments in the port.
Looking at the above numbers, it is evident that Nigerian Ports have the potentials to triple its outputs but instead, shippers patronise and prefers neighbouring ports such ports as Cotonou, Togo and Ghana with less economic strength because of inefficiencies at the ports due to high cost of shipment, delay, congestion etc. Improving these inefficiencies can be achieved through total digitalisation of the ports and maritime systems.
Shipping goods to Nigeria by sea from the United States currently leaves a big hole in the pocket of the shipper. The cost of shipping both 20-foot and 40-foot containers to Lagos ports from New York is one of the most expensive globally $4,982 for 20ft foot Container (from New York) and $7,436 40ft Container (from New York) to Nigeria
There are numerous advantages why Nigerian ports should fully implement the use of digital technology in driving better management and operations of the port. Some of the benefits are more flexibility, strengthening direct relationships with end customers, reduction of costs, facilitation of the ports growth strategy by creating new revenue generation streams, blocking of existing revenue loopholes, creating safer and more secured ports as well as a more profitable, sustainable and better port system.
