‘Tank farms must be relocated from Apapa to restore sanity’
Tony Anakebe is the managing director of Gold-link Investment Ltd. In this interview with AMAKA ANAGOR-EWUZIE, he shared his thought on port business in 2020 as well as things that could be done to restore sanity in Apapa and its environs. Excerpt
Nigerian port industry in 2020 he industry was seriously affected in 2020 by the outbreak of Covid-19, after which the nationwide #ENDSAR protest that took place in October and later became violent. These events demoralised a lot of importers from investing in new businesses.
The import volume was low because importers could not have access to foreign exchange even the exchange rate of dollar to naira skyrocketed and affected several industries. It also limited the purchasing power of both importers and manufactures. Industries that depend on port to bring in critical inputs did not find it easy bringing in the quantity of raw materials they needed.
Also, the condition of access roads to the port worsened the growth of business activities at the port. For instance, it was not easy for trucks to go in and out of the Tin-can Island Port in the past four months such that the haulage cost got to its utmost pick in December 2020.
Within those period, importers and their agents loaded containers from Tin-can to warehouses in Lagos as much as N1.5 million and more. All these things affected the business environment in 2020.
Most importers could not have access to dollars at the official exchange rate. Many of them had to rely on black market to access dollars needed for importation and this affected market prices of goods brought into the country.
It also contributed to the high inflation rate recorded in the country last year because importers must recover the capital invested and also make profit. With inflation rate standing at above 14 percent, one can see how low naira has been devalued.
Recession has affected businesses and the number of ships coming into the country. We hope that government would help to move the port out recession. The port industry is experiencing several unnecessary hiccups making it the bane of corruption in Nigeria. We had dialogued with Nigeria Customs and the extent of Customs’ alert on containers has reduced but other security agencies at the port are coming up with one barrier or other to hinder ease of doing business.
The government needs to open-up the port system. Onne is now functional but we need ports in Calabar, Warri and even Ontisha River Port to become fully operational. Government needs to invest in developing those ports and also allow private investors to run the ports.
We also hope that the introduction of electronic Customs system would help in driving ease of doing business by removing the clog in the wheel of progress so that agents can take their goods as quickly as possible. If the implementation starts as quickly as first quarter of 2021, it would help to reduce a lot of hiccups in the port.
Inability to evacuate goods from Tin-can
The rise in cost of doing business is the worst part of the present problem at TinCan Island Port. To access a seaport, one has to mingle between trailers and tankers. There has been total blockage that has affected the ease of doing business at Tin-can. It took my company almost two weeks to load a container after we finished with all the agencies at the ports and at the most exorbitant fare ever.
It took over N1.5 million to load one by 40 feet container while freight from China to Nigeria is not up to $4,000, we are spending more than $3,000 from Tin-can to Mushin in Lagos.
There was no truck coming from Mile 2 that could access Tin-can and when the truck loads in Tin-can, it has to exit through Apapa. Government is constructing the Tin-can axis of the Apapa-oshodi Expressway but sadly the contractor finds it difficult to create alternative route for trucks to go in and out of the port.
With all the tank farms located between Mile 2 and Coco Nut, even if the road is constructed to its fullness, the tanker drivers would block the road. How do we quantify the losses this brings to the economy? Some people are making money from the petroleum products while importers are paying large sum as demurrage. For sanity to return to the Apapa environment, all these tank farms must be relocated from the port so that importers can do their businesses seamlessly.
If it is well managed, it would help in reducing the gridlock around port. We foresee Nigerian factor and corruption affecting the gains of the e-call up system. Every evening, you see crowd at checkpoints in Apapa and they go there to pay, and somebody collects money on behalf of the security men. Most of these trucks pay up to N150,000 to find their ways to the port.