BusinessDay

Nigeria’s transport sector: Making it more attractive for investors

The role of transportation is to provide people and services with mobility access to employment, education, retail, health, recreational facilities, and other necessities that keep life going, and it involves the use of trains, buses, ferries, taxis, and airlines.

It helps move people towards a more sustainable future, and the more efficient trips done the less the number of private vehicles on our roads. This will lead to sustainability of our roads, less congestion and greater efficiency in the transport sector.

Some of the benefits of having an efficient transportation system in Nigeria are provision of alternatives to reliance on road transportation, reduction of traffic congestion as well as reduction of travel times. It also helps reduce pollution as well as improve quality of lives.

While transportation is a form of collection and distribution process, the shape and form of transport networks generally reflect the quality of lives and level of development of that nation

For example, Lagos, Nigeria’s commercial capital city, was recently ranked the second-worst city to live in the world among 172 cities ranked. While transportation is a form of collection and distribution process, the shape and form of transport networks generally reflect the quality of lives and level of development of that nation.

Nigeria needs to upgrade its transport system by adopting modern transportation strategies such as multimodal transportation system driven through the use of automated and digital technology systems to help realign the different modes of transportation (railway, buses, ferries, airlines, pipeline); and optimize its efficiency.

While suggesting better ways of upgrading our transportation system, it is important to highlight the importance of adopting modern strategies and re-evaluation of our transport policies e.g. the 2003 Nigeria Cabotage Act can be re-evaluated and tailored to manage current challenges in the sector, upgrade our nation’s inland container depot, dredging of River Niger, expedite completion of Lekki Deep Sea Port, hire more transport specialists, leverage modern automated and digital technology systems to drive the change we desire as well as total concession of our seaports, re-investment towards railway reforms (and other major reforms).

If the above are not in place, achieving a more successful transport system might be challenging as they are drivers that would help to – speed up timely door-to-door cargo delivery, reduce cargo handling costs, make the overall transportation costs lesser across all the modes, cut down delays and congestion within the value chain, increase safety and security. People and services will also arrive at their destination timely.

Nigeria has not been able to achieve most of its transport goals due to lack of guaranteed services schedule and monitoring systems, lack of good cargo information systems and modern cargo handling equipment, poor roads, non existent or improper rail links to the ports, poor security and safety systems in addition to the poor state of transport infrastructure across the nation (these have made some stakeholders prefer ports in neighbouring nations e.g., Cotonou, Togo, Ghana, etc).

While transportation, logistics and trade are all interlinked in such a way that efficient transport services are a prerequisite to achieving greater productivity, Nigeria like all other developed economies, needs to start working towards achieving full implementation of a multi-modal transport system as well as making it more attractive for private investors.

Our government also needs to limit its roles to regulation and coordination of the activities in the sector, otherwise government bureaucracy and delays would continue to constrain private investors from investing in the development of infrastructure that can accelerate development of the sector.

In summary, the government should play the role of facilitator thereby partnering with private investors in this regard. It needs to create the necessary business environment that would attract investors (local and international). This would help increase productivity as well as maximize growth in the sector through collaboration, innovation, and use of modern technology systems.

For example, in recent years through innovation and technology, RoRo shipping has evolved from shipping of vehicles in containers to development of new racking systems, such as R-Rak and EL-RAK solutions making the transportation of cars more affordable by increasing the carrying capacity of each container and safely too.

Also, with the current transport system in Nigeria, global logistics companies would find it challenging collaborating with Nigeria Railway Corporation, let alone with the Inland Waterway Authority and other associated agencies in the sector because of the wide gap in transport systems. Interestingly, nowadays global economies and organizations have achieved more growth because they implemented modern strategies and technology innovation in driving the sector.

While Nigeria’s current transport system needs to be upgraded to enable partnerships and collaboration with other developed nations, we the people need to work towards re-writing our story, especially in areas such as stamping out corruption, insecurity, unnecessary bottlenecks, nepotism, etc. embedded in the sector. This is because it reduces our ability to maximize business opportunities.

Also taking cues from successful transport nations such as Singapore, Netherlands, Germany, Belgium, Denmark, Japan, etc. we must not compromise on key factors that can affect the value chain, like building up a solid structure by ensuring the right people are put in the right positions. This would ensure global business practices are adhered to.

Successful transport nations also have modern infrastructure that enable businesses to run more efficiently. Additionally, most global logistics organizations would be more comfortable dealing with the private sector as compared to government agencies. Therefore, it is better the government plays a facilitating and regulatory role instead of being a competitor.

To achieve desired growth in our transport sector, it is important we begin to show determination, commitment, and transparency in overhauling the sector through transparent and inclusive privatization in the sector to build investors’ confidence. This would increase market share of the sector as well as add more value to our trade portfolio, economic systems, create more business and employment opportunities.

Last but not the least solution on the way forward to grow the sector is for government to allow private sector drive the change in terms of productivity, service delivery, modern marketing strategies, skills acquisition, training, innovation through use of modern technology and optimization of the entire operational network. The government has to remain in the background – monitoring, regulating and coordinating the activities of players and investors.

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