• Thursday, November 30, 2023
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BusinessDay

Lekki port struggles to gain traction amidst economic headwinds

Lekki Port in slow start as economic hardship worsens

Naira devaluation, FX scarcity and high exchange rates are causing a lull in business activities at the nation’s seaport generally, and the brand new $1.5 billion Lekki Deep Seaport is not an exception.

The port, which started commercial operations in April 2023, six months ago, is yet to start witnessing a boom in the volume of import and export containers coming and leaving the port.

The economic downturn in Nigeria has continued to slow the wider acceptance of Nigeria’s first deep seaport as a preferred destination for importers and other businesses.

Statistics obtained exclusively from Bolaji Abimbola, the media consultant to the port, show that the total ship traffic to Lekki Port in the last six months between April and September stands at 36 vessels.

The 36 vessels brought in a total of 18,198 twenty-foot equivalent units (TEUs) in six months.

A breakdown further shows that 18 out of the 36 vessels brought in transhipment containers with consignments going to other West African neighbouring countries in line with the Nigerian Ports Authority (NPA) drive to make Lekki Port, a regional hub.

Abimbola told BusinessDay that most of the containers meant for the Nigerian market are moved via the waters using barges to avoid clogging the road.

“Lekki Port is a new product and the managers of the port are carrying out aggressive marketing to attract more oceangoing vessels to bring in containers to the port. The NPA on their part is also selling it into the consciousness of Nigerian importers and neighbouring West African countries. Gradually, business is coming into the port and in less than no time, everybody that cares will want to do business here because of the high level of efficiency in this port,” said a source close to the port who does not want his name in the print for lack of authorisation to speak.

Read also Lagos in aggressive push ahead traffic from Dangote Refinery, Lekki Port

The source blamed the country’s economic hardship for Nigeria’s low import volume, which he said is not peculiar to Lekki Port as the high exchange rate of naira to dollar and surging inflation eat deep into the purchasing power of importers and consumers in Nigeria.

When BusinessDay visited the Ibeju-Lekki area and the Lekki Port last week for an on-the-spot assessment of the ongoing construction of the 6-lane Lekki-Epe Expressway, only about two empty containers carrying trucks were sighted on the road near Dangote Refinery.

Also, no truck was sighted entering nor exiting the new port with containers due to the industrial action embarked on by the Lekki Port chapter of the Maritime Workers Union of Nigeria, which rendered the port inactive for days.

The Union went on a warning strike to protest the refusal of Lekki Freeport Terminal, the port’s terminal operator, to pay workers the collective bargaining agreement and child education allowance as it is done in other ports in Nigeria.

“We are not seeing any truck carrying containers in and out of the port because the workers are on strike. But if the port is operational, it does not affect road construction because trucks are not allowed to park indiscriminately on the road as they do in Apapa and Tin-Can Island Ports. I don’t know how the managers of the port are doing it but I learnt that a trucker can only come to the port if he has an appointment to come,” Ude Amobi, a safety personnel at the Hitech construction site, told our correspondent.

Amobi, who disclosed that he was part of the Hitech team that worked on the Apapa-Oshodi Expressway, said that there is a high level of efficiency and orderliness in truck movement along the Lekki axis.

Babajide Ishola, a clearing agent told BusinessDay that when he recently went to Lekki Port to take delivery of a consignment, the truck had to follow Epe to Ijebu-Ode Road, which is usually free without having to pass through Lekki-Epe Expressway.

According to Ishola, importers and their agents have alternatives depending on the location of the warehouse where the container is going.

“Containers going to the Lagos Mainland can avoid the crazy gridlock at the Awoyaya-Sangotedo-Ajah axis of the road by following Epe-Ijebu-Ode and reconnecting Lagos through Ikorodu. Those containers going to the Northern or Eastern parts of the country have no business with Lagos. They can use the Epe-Ijebu-Ode road to find their routes,” he explained.

Meanwhile, Kehinde Olubi-Neye, chief commercial officer of Lekki Freeport Terminal, told journalists in Lagos recently, that Lekki Port operates a vehicle booking system that is linked to the automated gate where truck drivers are required to book appointments in advance before coming to the port.

He said the automated vehicle booking system operates like an electronic call-up, and it creates a system that allows trucks to access its truck park located very close to the port from where they access the port to pick up containers.

Read also Lekki Port is now processing transhipment cargo for neighbouring countries – NPA

On his part, Laurence Smith, the chief operating officer of Lekki Port, said the 150-capacity truck park would eliminate chaotic traffic associated with existing Apapa and Tin-Can Ports and avoid indiscriminate parking of trucks on the access roads to the port.

“Lekki Freeport Terminal operates a vehicle booking system widely used at all major container terminals globally. This will ensure that trucks are called via a booking system and will prevent congestion on the local road. The truck park eliminates loss of man-hours in traffic congestion and delays in port operations,” he said.

Olubi-Neye said the terminal operator is doing everything possible to ensure that there is ease in the movement of cargo out of Lekki Port.

According to him, the automated vehicle booking system will support the comprehensive call-up system for the Lagos Free Zone, Lekki Port, Dangote Free Zone, Dangote Refinery and the Pinnacle Oil and Gas, which the Lagos State Government is planning to deploy.

“We are in active discussions with the Lagos State Ministry of Transport and other stakeholders on the deployment of the call-up system for the Lekki area and we have confidence that the coming onboard of the call-up system for trucks will address any concerns that prospective port users would have over access to Lekki Port,” he said.

He said Lekki Port is also moving containers using barges via the waterway from Lekki Port to the Ikorodu area of Lagos.