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Chinwendu Obienyi
There is need for Nigeria to turn its ports into attractive hub to lift the nation’s Gross Domestic Product (GDP). According to Basil Akukwe, President of National President, Global Freight Forwarders and Maritime Association, despite the fact that the maritime sector is said to be next to crude oil in terms of revenue generation for the government, the sector’s contribution to the nation’s GDP is still very low if not insignificant. As a matter of fact, the sector is not even captured in the nation’s GDP by the National Bureau of Statistics (NBS).
Therefore, there is an urgent need for Nigeria to turn its maritime ports into an attractive hub to deliver better and efficient services and also stem the challenge of smuggling. In this interview, Basil Akukwe talks about the bottlenecks facing the industry as well as solutions in tackling them.
Excerpts:
Association
The role of our association is to enhance the profession of freight forwarding because they are experts in the logistics network and we also make our members to understand their rights, obligations and the need for total compliance with payment of accurate duties. As one of the major economic drivers, we ensure that they pay adequate duties in order to raise revenue for the government. This is because other countries in the world have tapped into freight forwarding business as their main economic stream. So we see it as an opportunity for Nigeria to tap into it as well.
Challenges
The ease of doing business in Nigeria is not friendly. The haulage business in Nigeria has a lot of bottlenecks, which include bad roads, various government agencies double-taxing businessmen and some of them on the highway disrupting movement of goods including duplication of duties.
We observed that during yuletide period or any festive period, traders will come to Lagos to buy goods from markets or warehouses with their waybills and on their way to their destinations, they will be arrested. Sometimes their goods will be seized and these goods were duly cleared at the ports or borders. Despite the fact that the Comptroller General of Customs is doing his best to restore sanity in the command, a lot of work and things still need to be done to stop this menace called corruption, which is the key objective (agenda) of President Muhammadu Buhari’s administration. We are urging the Comptroller General of Customs to continue in his good work of ensuring that accurate duties are paid and accounted for and his anti-smuggling war.
Infrastructure
The bad road network is one of the major problems of the shipping companies and this is because to deliver goods from Apapa to Lagos will take 30 days if not more. This problem has led to the rise of double payment in delivering goods as after clearing the container from the ports, it will take another three weeks to return the container to the shipping company. This has also led to the increase in prices of goods and services. This is why the Federal Government should look into establishing more ports in the country to decongest Lagos ports. Government should also declare emergency on Apapa -TinCan Road because it is no longer news that the roads are terrible. Containers fall there everyday, sometimes killing people and also causing heavy traffic. That road has become a nightmare especially to those who have businesses at the port.
Appeal Court recently dismissed NLNG’s case against NIMASA, insisting that gas firms will continue to pay tax, what is your opinion?
Ordinarily, NIMASA is the parent body of any organisation that deals with seaports under the Code of Conduct of NIMASA. The issue of both parties being at loggerheads is political and this does not give room for healthy relationship between the two sectors. Rather, it will lead to unnecessary rivalry that will affect the industry. We as one of the major stakeholders are concerned and we are pleading with the Federal Government to wade into the matter.
Smuggling
A lot of factors lead to smuggling in the country today. Some of these factors include government’s ban on some of the commodities, which had easy access into the country before without any hitch. For instance, we do not have a factory that produces tin tomatoes aside the new factory that is currently being built by Dangote, which has not started operation. What we have in the country today are companies that package tomato paste, which is still not enough for Nigerians. Secondly, there is no enabling environment for free flow of trade and services. Power continues to be a major issue and this is chasing existing and potential investors away. If the current administration continues to look into the power issue and tries as much in solving the issue, then a lot of investors will come on board and invest here in Nigeria. Similarly, at the moment, the poverty rate in the country is so high that some of these smugglers see it as another way of making money to survive.
Way out
The Federal Government should review the ban on some of the products as this will bring adequate food into the country. Also, the agencies in charge of preventing smuggling should be properly equipped and motivated to carry out their duties judiciously as most times the motivation is poor. Tax duties on vehicles should also be reduced and discipline should be restored in the agencies that work at the ports and borders. For example, Customs are supposed to stay 40 metres away from the border. Some of their jobs are revenue generation and anti-smuggling activities at the border, etc; they don’t have any business on the highway.
Unemployment
No doubt, unemployment is on the rise in the sector. Our motto is to establish a freight academy where workers in the sector will be tutored on global practices in the industry. We have made request to the Federal Government to help with finance, provide infrastructure (houses), vehicles, etc; this will enable the industry to be equipped. We observed that most people who are presently in the maritime industry still need more skills to excel. If there is an academy, we will have more professional members who will be enlightened on the need to pay duties and contribute their quota to the government. We do also disseminate information by various media, especially online, on the activities of our association, alerting the unemployed youths on the need to join our sector because our sector is large and untapped. Maritime is crude, that is why we want to establish and introduce Freight Forwarding Academy in this country. Such Academy exists in countries like USA, UK, Holland, Switzerland, etc.
Togo, Senegal, Benin Republic, all deliver better efficient services than Nigerian ports. What can Nigeria do to turn its ports to attractive destination and hub?
In all these countries mentioned, goods are cleared within 24 hours and the reason is simple; all the bottlenecks we encounter in Nigerian ports do not exist in their ports, like some of the agencies who do not have any business being in the port. They interfere a lot in Nigerian ports thereby slowing down the rapid clearing of goods at the ports.
In these countries, the ports are solely controlled and manned by their Customs, which is a different ball game in ours and in their ports if there is any harmful object intercepted in the course of discharging their duties, they will invite the appropriate agency responsible for that aspect.
Also, these countries have continued to expand their ports on daily basis unlike our ports that have been stagnant since their creation. Similarly, our ports have been concessioned not government-owned making a lot of things so difficult and expensive in which trucks are not allowed to park at the ports as they now park on the major roads causing heavy traffic gridlock, no clear accessibility to enter the ports.
Roads to the ports are now bad beyond human imagination unlike these countries where their roads are good for easy accessibility to the ports and for free movement of goods and services.
The shipping companies in our country are not helping matters with their high charges. They don’t collect deposit; you pay full amount. If you do not return their container at the agreed time, you will pay demurrage fee without them considering all the hurdles you met on the way, which delayed you.
There is urgent need for the Nigerian Customs to be more friendly to port users in terms of sensitising and educating them on the modus operandi in the ports and the need for total compliance.
Efforts to reduce smuggling
Nigeria has been able to reduce the level of smuggling by 95 per cent and I must really commend the leadership of Customs, Seme border, Comptroller Mohammed Uba, who has been able to dislodge the Cotonou enforcement agencies against their Nigerian counterparts by way of applying the best global practice in the transit of goods, which stipulates that transit goods proceed straight to the country of receipt. Uba has been able to create new parks on the Nigerian side to accommodate transit goods coming into the country to park unlike in the past when transit goods are parked in Benin area, which was against international best practice. These measures he put in place have drastically reduced smuggling of goods like rice, arms and other harmful goods coming into Nigeria by 95 per cent reduction if not 100 per cent.
