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Nigeria Loses Fortunes to Over-dependence on Lagos Ports

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Container Shipping
  • Nigeria Loses Fortunes to Over-dependence on Lagos Ports

The over-dependence on the Lagos seaports may be doing the economy more harm than good, as investigations revealed that Nigeria is losing fortunes to the underutilisation of other ports across the country.

The huge concentration on Lagos ports being the commercial nerve centre of the country may be limiting the maritime sector’s contribution to national earnings, which contributes as much as 30 per cent of Nigeria’s gross domestic product (GDP).

According to report, the diversion of cargoes to Lagos has impacted significantly on the ageing infrastructure at the Apapa and TinCan Island ports due to overwhelming cargo handling.

With dilapidated facilities, unfriendly environment and poor ports access roads, more importers are now seeking solace in neighboring countries, while the landlocked countries such as Chad and Niger, shun Nigerian seaports.
The fact that the TinCan Port earns over N1.2 billion and Apapa Port over realizes N220 billion yearly, show that the Federal Government is loosing fortunes for failing to promote other seaports.

This is because the more active the ports are, the higher the ability to create employment opportunities for the teeming youths and development of integral facilities that would fast-track economic development, as seen in the Chinese examples.

Statistics obtained from the Nigerian Ports Authority (NPA) showed that Lagos ports complex claimed 97 per cent of the containers that are berthed in Nigeria in 2016.

The Container traffic provisional figure of NPA showed that TinCan Island port received 179,443 Twenty-foot Equivalent Units (TEUs), while Apapa Port had 136,543 TEUs. Rivers port had 2,053TEUs. Onne had 44,961TEUs; Delta had 1,961TEUs while Calabar recorded zero container traffic in 2016. Calabar is currently handling only liquid cargo, due to shallow water challenges.

Stakeholders blamed the concentration on Lagos ports on shallow waters, long channel of other ports, politics and industrialisation, which necessitated the choice of Lagos as the port of destination for most cargoes.

Acting President, National Association of Government Approved Freight Forwarders (NAGAFF), Increase Uche, told The Guardian that the concentration on Lagos Ports is the architecture of the government’s political strategies on wealth control.

He also blamed lack of political will and distance from the ocean to low patronage of the Eastern ports, noting that although Lagos ports are prioritised because they are close to the ocean than other ports. They also have longer river channel, and as such, government needs to strategise to boost operations in other ports in order to have balanced trade across regions.

Over concentration on Lagos ports, according to him is posing unnecessary migration into the Apapa area and resulting to overwhelming pressure on the infrastructure facilities.

“The reason people give is that the Lagos and Port Harcourt ports are very close to the ocean, other ports are far from the ocean. It, therefore, takes longer time for the vessels to move from the anchorage at the high sea to other ports, but here in Lagos, it takes less time for any vessel to access that area.

“Owners of vessels will prefer Lagos ports to the other ports, but one will be tempted to ask, what if the ports in the eastern part are the only one we have in the country? How will the economy survive? We need to put all hands on deck to ensure that those ports are not wasted, because most of those structures are now rotting away because they are not put to use, while the ones in Lagos are over used and then it becomes generic problems,” he said.

The Speaker, House of Representatives, Yakubu Dogara, recently said Nigeria was losing N1 trillion yearly due to bad roads in the country, where the Federal Government is estimated to have spent about N73 billion on roads maintenance and repairs last year.

Stakeholders believed that the huge burden on the roads created by haulage of imported goods from Lagos to other parts of the country are taking toll on the longevity of the roads, thereby necessitating high expenditure on maintenance.

Meanwhile, businessmen from the eastern part of the country are irked about the need for them to import through Lagos and incur additional expenses coupled with the risk involved in transportation.

An Onitsha-based businessman and Managing Director, OkayGod Investments Limited, Augustine Okechukwu, said the situation is worrisome and have a huge impact on the cost of production, coupled with the risk of transporting the goods through terrible roads from Lagos to Onitsha.

He said: “We all imported through the Port Harcourt ports before, but we decided to change to Lagos as our port of destination because clearing goods from Port Harcourt seaport is very hectic and cumbersome. You cannot get your goods easily from Port Harcourt. I think it is deliberate so as to make people patronise Lagos than other ports.”

On the cost of clearing and transporting the goods between the Lagos and Port Harcourt ports, Okechukwu said: “Cost of transportation from Lagos is high and it is affecting businesses here. But we still prefer it because if you import through Port Harcourt, it takes two to three months to clear, meanwhile, it take a few weeks to clear in Lagos. Although, there is the risk of an accident due to the bad roads, but we are compelled to use Lagos ports because we see it as a better alternative.”

The President, National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), Lucky Amiwero, said the components that determine the choice of port such as freight cost, the draft and cargo destination do not favour other ports, hence the use of Lagos ports.

“Why you are having more traffic in Lagos ports is because most of the cargoes are consumed around Lagos area, while the other places don’t have many industries. Many of the ships that are coming to Lagos are based on the request by the importers, who are businessmen around Lagos.

“If you want your cargoes shipped to the East, you might not see a ship going to the East, besides, the freight to the East is too expensive and it is not as requested as Lagos, because Lagos has a concentration of market,” he said.

The General Manager, Public Affairs, NPA, Effiong Etim Nduonofit, assured that NPA is putting machinery in place to promote the use of all the ports, but added that the choice of cargo destination is determined by the importer.

He said the management is giving incentives in terms of rebate to promote the eastern ports, adding: “Also, the Authority is giving preference to rehabilitation of infrastructure such as the quay apron, maintenance of the channel and provision of navigational aids to guide the vessels sailing to those ports.

“Besides, the management has emphasized that they are going to promote operational efficiency at those ports to ensure that turnaround time is reduced to the barest minimum as well as ensuring that other key performance indicators are in charge.

“Over time the management has continued to do both maintenance and capital dredging of the ports in line with international best practices to encourage operations at those ports,” he said.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Business

NAHCO Recalls Suspended GMD/CEO, Mrs Adetokunbo A. Fagbemi

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NAHCO Recalls Suspended GMD/CEO, Mrs Adetokunbo A. Fagbemi | investorsking.com

Mrs. Adetokunbo A. Fagbemi Resumes Work With NAHCO

The Board of Directors of Nigerian Aviation Handling Company Plc (NAHCO) has recalled Mrs. Adetokunbo A. Fagbemi, the Group Managing Director and Chief Executive Officer, who was suspended over Management’s failure to diligently secure the delivery of a purchased equipment from vendor within the contracted period and Management’s inability to provide satisfactory/acceptable reason for the unreasonable long delay.

Mrs. Fagbemi was suspended by the Board at a meeting held on 27th of January 2021 in line with the Board’s earlier decision that if a certified bill of lading for the equipment was not received by 2nd February 2021, the GMD/CEO shall proceed on suspension with half pay until receipt of acceptable evidence of equipment shipment from the manufacturer.

Since Mrs. Fagbemi commenced her suspension on February 3rd, 2021, Mr. Olumuyiwa A. Olumekun, the Group Executive Director, Corporate Services, has been acting as the GMD/CEO, according to a statement put out by the company.

It said “the Board is however pleased to inform the investing public and the Exchange that on, Tuesday, February 24, 2021, a satisfactory evidence of departure and arrival dates of the equipment has been received by the board from the equipment manufacturer.

“Consequently, the Board at its emergency meeting today, February 24, 2021, has recalled the Group Managing Director/Chief Executive Officer, Mrs. Adetokunbo A. Fagbemi from the suspension and she has resumed work.”

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Business

Businesses Groan as Price of Diesel Rises to N250 Per Litre

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Petrol Importation

Businesses Groan as Price of Diesel Rises to N250 Per Litre

Businesses have started feeling the negative impact of the rising price of Automotive Gas Oil, known as diesel.

A single litre now goes for N250 in some parts of Lagos, with businesses taking a beating on the back of rising energy costs.

Our correspondent observed that some filling stations in Lagos had increased the price of the product to N250 per litre, while many others sold it at between N220-N245.

Northwest Petroleum along the Oshodi-Apapa road increased the pump price of diesel to N250 per litre; AP (Ardova Plc), along Airport road, Ikeja, N248; and Oando, along Acme Road, N240.

The National Bureau of Statistics, in its AGO price report on Tuesday, said the average price paid by consumers for diesel increased by 0.22 per cent to N224.86 per litre in January 2021 from to N224.37 in December 2020.

It said states with the highest average price of diesel were Adamawa (N268.33), Zamfara (N262.78) and Kebbi (N257.50).

“States with the lowest average price of diesel were Osun (N194.60), Anambra (N195.83) and Enugu (N198.24),” the NBS added.

Crude oil price accounts for a large chunk of the final cost of petroleum products, and the deregulation of the downstream oil sector by the Federal Government means that the pump prices of the products will reflect changes in the international oil market.

The international oil benchmark, Brent crude, has risen by more than 25 per cent this year from the $51.22 per barrel at which it closed last year. It rose to $65.25 per barrel as of 6:30pm Nigerian time on Tuesday.

Diesel is mostly used by businesses to power their generators amid a lack of reliable power supply from the national grid.

The President, Association of Small Business Owners of Nigeria, Mr Femi Egbesola, lamented that the recent increase in the price of diesel was taking a heavy toll on businesses, especially Small and Medium Enterprises.

“The cost of diesel and raw material is giving us a nightmare. The price of diesel has been skyrocketing in a way that creates fear in particularly manufacturers,” he told our correspondent on Tuesday.

According to him, it is difficult for businesses to factor all the increase in diesel price in their final product prices.

Egbesola said, “That is why a lot of companies are downsizing and are making sure that they only produce products that they are so sure will sell in the market.

“Many companies have reduced their product lines significantly just to be able to cope. And that is not good for us because by the time this goes on, unemployment will increase. I believe government should be able to do something about this.”

He said although the downstream petroleum sector had been deregulated, there should be checks and balances.

Egbesola said many small businesses’ savings had been eroded already because ‘we keep spending our savings to make sure we don’t close shop’.

He said, “If things continue this way, there is no way we are not going to close shop. We are still struggling with the recent increase in electricity tariff.

“Many small businesses still depend so much on diesel generators because there is no alternative power supply. It is only the big players that have the facilities to use gas. And we cannot use solar installation because it is very expensive.”

Nigeria, Africa’s largest oil producer, relies largely on importation for petrol and other refined products as its refineries have remained in a state of disrepair for many years.

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Appointments

United Capital Appoints Latunji Head, Marketing/Corporate Communications

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United-capital

United Capital Appoints Latunji Head, Marketing/Corporate Communications

United Capital Plc has been appointed, Tolu Latunji as its Head, Marketing & Corporate Communications.

In the new role, he is expected to drive a strategic communications, marketing and brand management programme for the investment banking group.

Latunji is a communication and marketing expert with 12 years’ experience in products development, marketing, brand & franchise building, effective management and communication of strategic objectives whilst ensuring adequate visibility for both organisation and product/service offerings through product, content and brand initiatives.

“With a 360 degree knowledge of communications and marketing, which includes but not limited to – brand management and initiatives, corporate affairs, internal and external affairs, product and brand marketing, event management and experiential marketing, cluster/segment marketing, Tolu has served at various capacities on government constituted sub-committees on financial inclusion,” a statement explained.

Prior to joining United Capital Plc, he was the Managing Partner of Ten & Square Media Co., a bespoke creative ideation and brand/crisis management firm, based in Lagos, Dakar and London.

Latunji was recently the Strategic Communications lead at FMDQ Securities Exchange, Nigeria’s first integrated financial market infrastructure (FMI), where he had the responsibility of effectively positioning the group, together with its subsidiaries, as the most sophisticated and technologically driven securities exchange in Africa.

Prior to that, he worked in Guaranty Trust Bank for nine years with roles in brand management & monitoring, events and experiential marketing, products and content marketing and user experience.

He led the marketing team to the successful development and launch of various retail, SME and corporate products. He was also instrumental in curating and developing the bank’s social footprints. Outside the corporate environment, Tolu engages in various humanitarian activities with food banks and empowerment programmes. He holds a B.Sc. Economics from University of Lagos.

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