Seaport Operators Face Hard Times As Economic Realities Dawn

Fortunes of seaport terminal operators have continued on dwindling spree with economic realities taking a huge toll on importation and leaving the ports empty.

With the Nigerian Ports Authority (NPA) statistics of vessels calling at the ports dropping from the average 40 to 19 last week, LEADERSHIP gathered that some of the terminals have not received vessels in the last three months.

The unprecedented reduction in importation has also been evident in Customs earnings, which have continued plummeting since January this year.

When LEADERSHIP visited the some of the terminals yesterday, there were only two vessels discharging at the APM Terminals in Apapa and another one at Ports and Cargo in Tin Can Island Port. The other terminals were empty.

A clearing agent, Usifo Amos, who spoke with our correspondent blamed the trend on scarcity of forex which has led to the inability of importers to bring in goods. He also said certain government policies such as the automotive, rice and fish quota policies were responsible for poor vessel traffic to seaports.

“You know that the ENL Terminal handles bulk cargo and general cargo, which are made up of about 70 per cent rice and fish, but since the policy on rice and fish to discourage their importation, the terminal has not been doing business.

“For the RORO terminals, such as Five Star and the Tin Can Port which also handles vehicles, ships come there only once in a while because of the auto policy, which is aimed at discouraging importation of used vehicles and even new ones. What is happening now is that even if some wants to import vehicles, they do so through the port of Cotonuo and bring them in through the border,” Amos said.

A new report on port operations in Nigeria said spiraling inflation and the declining value of the naira has eroded the value of seaport terminal operators’ earnings by about 238 per cent over the past ten years.

According to a new industry report which is about to be published by a leading audit firm, the terminal operators, who have invested over N200 billion between 2006 and 2015, have lost an estimated N58.9 billion in earnings over the period.

“Right now, things are so bad that the terminal operators must now increase cargo handling charges. It is now inevitable that this happens because for a long time, the port operators have not increased their rates,” a source close to one of the terminal operators told LEADERSHIP.

The Nigerian maritime sector accounts for over 50 per cent and 80 per cent of the value of West Africa’s imports and exports respectively, according to the National Bureau of Statistics (NBS). The performance of the maritime sector has historically had significant impact on the economy in terms of government revenue, improved trading affiliations with other nations and other indirect impacts which include job creation.

Before the concession, infrastructure was deteriorated and most equipment like reach stackers and forklifts were insufficient, outdated and malfunctioning due to lack of procurement, maintenance and repair.

The berth areas infrastructure were not Investments made by NPA in terms of improved provision of marine services and expansion of existing port facilities in order to accommodate increased vessel traffic coupled with the massive investments made by the terminal operators have helped to free up congestion and increase activity at the ports.

Nigeria has attempted to introduce several additional reforms which are aimed at improving the effectiveness of the sector. Some of such reforms include the National Transport Commission (NTC) bill, the railway bill, the ports and harbors bill and the Inland Waterways bill currently before the national assembly, each of which will have its impact on the maritime sector.