Scarce forex supply and high exchange rate were major setbacks to import business in 2021 especially for manufacturers and other shippers that bring in raw materials into the country, according to Jonathan Nicol, the president of the Shippers Association of Lagos State.
Consequently, Nicol appealed to the Federal Government to create a special forex window for shippers to access foreign exchange easily this year.
“We are appealing to the Federal Government to give shippers, especially those running industries a special window to get allocation for foreign exchange because they employ millions of Nigerians. The Central Bank of Nigeria (CBN) should be able to give such importers concession because it will help to encourage industries not to cut down their staff strength because if they do, more Nigerians will lose their jobs,” he said.
According to him, foreign exchange rate and supply for industries have to be static including the exchange rate for clearing goods at the port, which is the rate approved by CBN for the payment of Customs tariff, because fluctuation on rates also affects industries.
“In doing this, people will be encouraged to bring in their technical partners to establish industries and create jobs in Nigeria,” he added.
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Nicol, who noted that shippers expect that import business would remain stable this year because there are specialised cargoes for government, factories, and industries such as key industrial equipment that would continue to come into the country regularly despite the economic situation.
He however pointed out that such cargoes will continue to come but it may not be 100 percent due to the high foreign exchange rate in the country.
While noting that shippers are a bit worried about the political situation in the country because politics attracts insecurity, Nicol said that this year is going to be a determinant year for importers and exporters because if there is unrest due to politics, for instance, people would not be able to get their export cargoes from the hinterland, and no import would be going to the hinterland as well.
Listing some of the challenges faced at the nation’s seaport by shippers in the previous year, Nicol said that shippers are still having pockets of delays as a result of transporters not being able to enter the port as and when due to return empty containers.
“Transporters said they are still paying as much as N130, 000 as toll before they could access the port. These tolls still come back to the shipper by way of the high cost of transport, and some truckers pay as much as N80, 000 to drop empty containers at some shipping lines holding-bays. Some shipping lines will say they are not ready to receive empty containers meaning that the empty will remain on top of the truck. This has created some unrest between the transporter and the cargo owner. There are shipping lines that transporters refuse to pick their cargoes because it is difficult to drop their empties and that is not too good for business,” he explained.
On how the port business fared in 2021, the Shippers Association boss said 2021 was a year of great expectations for the shippers following the exit of the immediate past Executive Secretary of the Nigerian Shippers’ Council and the coming of a new person.
He said there was a little bit of depletion of cargo due to the global container glut, and the cost of freight from countries of origin to destination ports increased by close to 400 percent.
These issues, according to him, made many shippers go on holiday except for shipments that are extremely important like raw materials for factories because the cost of doing business also went up.
“The former Executive Secretary of the NSC was able to set up the Port Standing Task Team, which made sure that the Nigerian Port Process Manual (NPPM) was meticulously obeyed and that brought some relief to shipping lines such that it now takes between two to three days to berth vessels. This means that shipping lines would not spend many days or weeks to discharge a vessel,” Nicol said.
Continuing, he said: “Shippers are happy because their goods are dropped with ease. The team is also fighting for the ease of clearing cargo and has given a matching order that all government agencies must come together in any physical examination process, failure of which, the agency will forfeit its right to examine that cargo. And those cargoes when released are not subject to any government agency to stop on the way. This is a new innovation that will bring relief for cargo owners and we pray it continues.”
On port digitalisation, he said, the current ES of NSC is going ahead with the port digitalisation process, adding that building a modern port infrastructure like an electronic gate would take away physical manning of the gate.
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