In China, ports are the gateways to international trade. One hundred and thirty of its 2,000 ports are open to foreign ships. Dwell time is no more an issue, and traders are aware of what to spend to get their goods in and out.
As a result, 12 of its marine-related companies created 10.75 million jobs in just in 2017, according to Alistair McIlgorm, a marine and fisheries economics and management specialist.
In 2011, Port of Shanghai overtook Singapore as world’s busiest port, handling 514 million annual cargo tonnages. Seven of the top 10 container ports in the world were Chinese as at 2018, according to data from the World Shipping Council.
Apart from Shanghai, there is a model in Africa that Nigeria can copy. The Port of Durban in South Africa is the largest and busiest shipping terminal on the continent, with 58 berths, handling up to 45 million tons of cargo and 4,500 commercial vessels every year.
It ferries out $45 billion worth of trade annually – equal to 11 percent of Nigeria’s GDP.
Rail tracks totalling 302 kilometres link the port to the rest of South Africa and provides 100,000 jobs, including the use of drones for surveillance, monitoring and for other operations.
The port, also known as Durban Harbour, has a track-and-trace technology that tracks port assets such as tugs and dredgers.
It is transforming into a mega logistics gateway and, like Lagos, is located close to a central business district.
Nigerian ports on the other hand handled 4,009 vessels in 2018, according to the Nigerian Ports Authority (NPA).
This number means that Apapa and Tin Can ports in Lagos handled fewer vessels than Durban.
Business worth about N1.9 trillion ($5bn) is done at the Nigerian ports and waterways each year, according to Nigerian Shippers’ Council (NSC), as against Durban’s $45 billion.
But empty containers dot Apapa and Tin Can ports, two of the nation’s premier ports located in Lagos, causing congestions. Scanners are not working at the ports, and access roads are nearly inaccessible.
When railways are constructed, no one understands the economics of linking them to the ports.
Today, the documentation processes for cargo clearing is clumsy and cumbersome for importers, and as a result, it takes a minimum of three weeks to clear cargoes from the ports.
The management of the Nigerian Customs Service (NCS) has succeeded in creating multiple units for cargo clearing at ports due to physical inspection caused by lack of functional scanners.
These units are presently creating bureaucratic bottlenecks and delay, experts say.
A recent visit to the ports shows that currently the NCS has over 12 different units at each port, which include Enforcement, Valuation, Customs Intelligent Units (CIU), Residence, Taskforce, Strike Force, CG Squad, Headquarters Strike Force, Customs Police, Special Weapons and Tactical Team (SWATT), Abuja Alert and the Federal Operations Units mounting checkpoints right at the port gates.
These units are involved in cargo clearance such that importers and their agents must seek approval of their documentation before the release of their cargoes.
Consequently, importers and their agents are presently encountering delays during cargo clearing, which compels them to pay demurrage and storage fees to shipping companies and terminal operators for failure to take delivery of their consignments conformably.
Vicky Haastrup, chairman, Seaport Terminal Operators Association of Nigeria (STOAN), who condemns the high rate of manual examination of cargoes at the port, says deployment of automated scanners would drive and enhance the cargo clearing process.
Haastrup, who spoke in Lagos during a virtual conference held recently, notes that manual examination of cargoes is not efficient.
“We have a situation where people must visit the port physically to do Customs documentation and cargo examination before they can take delivery of their consignment,” she states.
According to Cajetan Agu, director of consumers’ affairs at the Nigerian Shippers’ Council (NSC), in Lagos recently, Nigeria is losing out for failing to adopt technology like neighbouring West African ports.
Citing example, he says before the introduction of single window in Benin Republic, cargo dwell time was more than 18 days, but since the port embraced single window, cargo dwell time crashed to less than seven days and revenue for government also jumped up by 33 percent.
In Lome Port, Togo, cargo dwell time has fallen from 22 days to three days due to use of technology.
In Port of Tema, Ghana, dwell time came down to 15 days from 24 days due to improved service efficiency.
“We must have a port that is contactless and paperless. We need the Nigerian Ports Authority (NPA), Customs, freight forwarders and service providers to transact business online. We have to sharpen our terms of trade, and there are four vital legislations that we have to push out including arrival and departure of ships, responsibility of terminal operators for transparency, and electronic bill of lading, which will make it mandatory for people to transact online,” notes Hassan Bello, executive secretary, NSC.
A recent report published by SBM Intelligence, Nigeria’s leading geopolitical intelligence platform, shows importers using Lagos ports pay more as shipping charges for bringing goods from European Union (EU) and high terminal charges when compared with what importers using Tema Port in Ghana and
Durban Port in South Africa, pay.
A breakdown of SBM report shows that importers using Apapa Port in Lagos pay about $374 as shipping charges on imports from EU countries; $457 as terminal handling charges and $2,055 on local transport to importers’ warehouses.
Meanwhile, importers using Tema Port in Ghana pay $321 as shipping charges on import from same EU countries; $284 as terminal handling charges and $285 on local transport to importers’ warehouses.
Also, importers using Durban Port in South Africa pay about $247 as shipping charges on imports from EU countries; $180 as terminal handling charges and $208 on local transport to importers’ warehouses.
This could force more Nigeria’s importers to divert cargoes to other African countries as soon as the African Continental Free Trade Area (AfCFTA) agreement begins in 2021.
Hadiza Bala-Usman, managing director, NPA, said one of the things hindering Nigerian ports from achieving efficient and timely service delivery, which translates into huge cost for the consignee, was the absence of Single Window platform.
According to Bala-Usman, establishment of Single Window would ensure that Nigeria has less human interventions in cargo clearing system.
On delay encountered by ships at Nigerian ports, ship owners say that there is need to reduce the number of government agencies that go on-board vessels for clearance.
Aminu Umar, a ship owner, says ships experience so much delay before being authorised to berth in Nigerian ports, which has affected their operations.
“With this delay, demurrages also piled up for ship owners and this has created serious conflict between the ship owners and their clients. Nigeria needs to adopt European procedure where no official is allowed to board the vessel because clearance of vessels are done virtually, which is a much preferred procedure that Nigeria can adopt,” Umar states.
Also, with the alarming rate of congestion in port terminals as well as persistent traffic jam on the roads leading to seaports in Lagos, Nigeria must begin to use a combination of rail, inland waters and road to not only decongest Apapa and Tin-Can Island ports, but to also make the cost of haulage competitive.
Bala-Usman, who is of the view that Nigerian ports would not function well if 90 percent of import and export cargoes are moved by road, said there was a need for Nigerian importers to make use of intermodal transport system in evacuating their goods out of the ports.
“Evacuating cargoes using the waterways and rail would be a very significant development that would strengthen intermodal transportation system.
“Economically, it would mean a lot to the nation’s economy, especially as regards the fact that one of the major concerns for port users, revolves around the huge revenue loss to congestion on the roads leading to ports in Lagos,” she said.
Unemployment in Nigeria rose to 27.1 percent in the second quarter (Q2) of 2020 from 23.1 percent in the third quarter of 2018.
The job-starved economy shrank by 6.10 percent in Q2 2020 in real terms and is a quarter away from another recession in four years. The economy needs to create jobs for the world’s poverty capital, but for that to happen the ports must provide the right atmosphere for businesses to thrive and provide employment, analysts note.
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