• Tuesday, June 18, 2024
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FG’s approval of Snake Island Port to unlock $1 billion in private investment

Pressure mounts on importers as clearance fees adjusted to N952

The Federal Government’s approval for the commencement, expansion, and development of Snake Island Port through a Public Private Partnership arrangement could unlock about $ 1 billion in private investment, the company has said.

This comes with a new 45-year concession agreement for Snake Island Port, allowing for an expanded operational scope, and is set to be a significant milestone for the Nigerian shipping industry.

This approval highlights the importance of PPPs in driving economic growth and development in Nigeria, with the country experiencing a growth in PPPs over the last decade across different sectors from energy to infrastructure, transportation, and telecommunications, the company said in a release.

Stakeholders have consistently clamoured for increased private sector involvement in financing critical infrastructural development in different sectors, and as private sector players identify infrastructural gaps in the country’s maritime sector and take strategic steps to fill them, significant improvements in the sector are imminent.

This approval highlights the importance of PPPs in driving economic growth and development in Nigeria, with the country experiencing a growth in PPPs over the last decade across different sectors from energy to infrastructure, transportation, and telecommunications.

Investments in Nigeria’s ports will improve efficiency in cargo handling and reduce turnaround times for vessels, the high cost of shipping, and the challenges currently experienced in logistics services.

Read also: Increase investment to grow maritime sector contribution to GDP – SIFAX boss

Achieving significant cost savings for businesses increases competitiveness and provides a more business-friendly environment compared to other African countries. Private investment also leads to the development of new technologies and innovations, which can further boost the sector’s growth and development and play a crucial role in driving the growth and modernisation of the maritime sector.

Over the years, PPPs in the maritime sector have paved the way for investments in the acquisition of modern terminal equipment and expansion of existing cargo holding facilities, improved efficiency and growth in both ship traffic and cargo, and the acquisition of operational platforms and systems for regulatory activities. As of 2021, the Federal Government’s revenue from the maritime sector had doubled in the 10 years post-concession.

Nigerdock was originally awarded Free Zone and Port Development Status by the Presidency in 2005, leading to the establishment of Snake Island Integrated Free Zone (SIIFZ) in the same year.

The Nigerian Ports Authority (NPA) and Nigeria Customs Service approved direct shipping for the facility in 2017, with the NPA green-lighting cargo handling operations in 2021.

The PPP project, which has been in the works for some years, will see Snake Island Port immediately commence operations as an expansion to Nigerdock’s existing operations, while the shipyard and Free Zone remain core parts of the business. This move is set to spur economic growth and development in Nigeria and attract more clients to SIIFZ.