‘Nigerian ports have seen improved cargo throughput, turnaround time of vessels in the last eight years’
Tony Nwabunike, renowned maritime professional and pioneer chairman of the Council for the Regulation of Freight Forwarders in Nigeria (CRFFN), is the managing director of Mac-Tonnel Nigeria Limited. In this interview with AMAKA ANAGOR, he examines the state of Nigerian ports industry eight years after the Federal Government’s handover of cargo handling operations to terminal operators.
A ssessment of port concession eight years after
Currently, most of the terminal operators to whom the port was concessioned eight years ago have actually been developing the port. For instance, APM Terminals Apapa and Grimaldi are typical examples of the good job that terminal operators are doing at Nigerian ports. They have liberalised Nigerian ports in the sense that some of the terminal operators, who are mostly foreigners, have simplified the work of freight forwarders like us in terms of cargo clearance. The turnaround time of vessels has improved tremendously while cargo throughput at our ports has also doubled.
In terms of cost of doing business at the port, it has become more expensive to clear goods at the port than when the port was completely in the hands of Nigerian Ports Authority (NPA). When cargo was handled by NPA, the cost of doing business at the port was normal and at a bearable level but at present, the concessionaires are mostly foreigners and they are equally bringing about capital flight because they earn so much money from Nigerian ports, which they remit to their countries of origin while Nigerian economy is at the losing end.
To curtail these excesses that result to high cost of doing business at the port, the Federal Government should look into the charges imposed on the importers by terminal operators and shipping companies, and bring some of them down in order to make Nigerian ports more cost-effective. When you look at the charges of these terminal operators, you will find out that there are areas of challenges as well as issues which CRFFN and several other committees set up in the past have tried to address. The charges of the service providers are yet to come down, that is why I think the Federal Government needs to intervene.
Using 79 signatures to clear cargo at the port
I agree with the Independent Corrupt Practises Commission (ICPC) report, and it is even higher than that number because if an importer goes to the port to clear a container, a single document sometimes goes through the hands of 100 persons before the person will be allowed to take delivery of his or her consignment. Many government agencies at the port duplicate themselves and at the end of the day, they end up doing same job. The Federal Government must look into that because it results to extortion. This is the problem that we are having, which is why people keep saying the cost of doing business is high. It’s a situation where so many tables will be waiting for one document, and at end of the day, the person would be asked to pay gratification. Those tables are there for the purpose of gratification and not because the agencies are doing what government wants them to do or because they are hardworking.
48-hour cargo clearance
The issue of using 79 signatures to clear a cargo at the port is one of the reasons why achieving 48-hour cargo clearance cannot be achieved in Nigerian ports. Customs has improved a whole lot and if every other thing is put in place, Nigerian ports will be able to achieve 48-hour cargo clearance. But the security agencies involved in cargo clearance must be streamlined down to about two.
The issue of interconnectivity between agencies involved in cargo clearance is not really where the problem is because agents can go to any cybercafé to log in their entries and do other things that have to be done with documentation processes. The issue lies with the stagnant processes of the documentation, which involves those who want to look at the documents.
Impact of insecurity on volume of cargoes going up north
Cargoes going up north have dropped drastically by more than 90 percent. In the last five years, our terminals recorded almost 15,000 TEUs, but recently our volumes do not measure up to 1,500 TEUs. We found out that volume has dropped drastically due to insecurity in the north. The cargoes comprise consumables, unfinished products, and raw materials for companies like Kaduna Textile Industry, plastic industry and other manufacturing companies in the north. Until terrorism is eliminated in the country, the economy of the northern parts of the country may continue to suffer. Therefore, we are supporting the Federal Government for taking the bull by the horns in tackling terrorism in the country.
The supply to the north has gone down. The throughput to Nigeria has equally dropped due to the problem importers encounter in terms of business loss. Many importers are currently dropping their levels of importation.
Creating a single platform for cargo clearance
What I think people are talking about is the latest version of the Automated System for Customs Data, which is ASYCUDA 007, whereby you sit down in your office and everybody sees what is happening, but an average Nigerian would want to be in the port to see what is happening because of what they are going to get in terms of gratification. Otherwise, if we are all interconnected, I will be in my office, log in my entry and my cargo will be released from the Customs Processing Centre (CPC) for me to take delivery of my consignment in a seamless process without having to be at the port. Agencies at the port will not want this but will delay you and make you do what you would ordinarily not want to do. So the delay we have in the clearance of goods at the ports is man-made because the level of ASYCUDA that we have today can achieve 48-hour cargo clearance if there are no encumbrances at the ports.
I think government should really exercise its oversight functions by making sure that things actually work at the ports, by calling a spade a spade and by streamlining the agencies operating at the ports. They must make sure that things work. For example, in Customs, they should choose the number of units so that things will move faster.
24-hour port operation
It is still on. You can process your goods at night but only at the gate. An importer cannot do other processes except if the person has finished every other thing and it remains to take delivery of the consignment.
CRFFN five years on
CRFFN was established five years ago by an Act of parliament in 2007 to regulate and discipline freight forwarders. Though the council has not got to where we, the founders, want it to be, it is growing. The law enforcement unit of CRFFN was inaugurated and saddled with the responsibility of removing the quacks from the professional freight forwarders who are not only practicing the business of freight forwarding but have undergone training and were given certificates to practice. Therefore, anybody who is not a CRFFN-certified freight forwarder will be closed up very shortly. So, the council is growing gradually because we are now placing Nigerian flags under world freight forwarders associations like FIATA, World Cargo Alliance, etc. The council is also doing well in the area of giving Nigerian freight forwarding profession recognition in the world of freight forwarders. We are trying to sanitise ourselves and make things work so that people will not see freight forwarders as quacks. So, I will say that CRFFN is moving forward from where we left it years back.
The council’s objective was to make sure that all the freight forwarders are disciplined, educated and trained to know how to carry out clearing documentation and other works in the port. Again, the government’s reason for setting up the council is to make sure that it regulates all the licensed Customs associations and control them by putting down guiding rules and regulations. The Federal Government has tried in doing this but we want CRFFN to try and ensure that the law is enacted. It is a gradual process to get to the desired status because if we look at what clearing agents are doing in the course of clearing goods at the port, one will appreciate what CRFFN is doing. The issue here is that so many freight forwarders associations have come up and most of them do not want to be regulated or controlled, but the truth is that they cannot be above the law.
Funding of the council
Funding has been the major bane of CRFFN because Federal Government will soon get tired of funding it. The government has given them the opportunity to collect registration fee, but until it gives a serious enforcement backing to the CRFFN, we will not move forward.