A fresh insight was provided recently into how politics mixed with cronyism is hobbling the operations of the Nigeria Customs Service at the Lagos-Apapa ports, exposing the incompetence and waste that characterise governance in Nigeria. In a stinging rebuke of the subsisting order, a Customs controller blamed the chaos and the accompanying losses at the ports on the primitive manual clearing system. The bedlam had been aggravated by the overbearing presence of other government agencies, decrepit access roads, insecurity and corruption.
Exuding a rare forthrightness, Mohammed Abba-Kura told the House of Representatives Committee on Customs and Excise, which was on oversight duty, that three high-calibre, multimillion dollar scanners deployed for operations had not been working in the past few years. This is scandalous.
The controller traced the anomaly to the poor capacity of the Nigerian company that was awarded the contract to handle the scanners after the initial contract with Cotecna, an international outfit, was revoked in 2015. Consequently, the Smiths Hiemann 2533 HCV machines, which some Customs personnel went overseas to train for, have been wasting away. This means tedious physical inspection prevails at the ports. Undoubtedly, physical inspection is outdated in the 21st Century. It is primarily why lethal and fake goods escape inspection at the ports. It causes delays, cargo pilferage and excessive charges. It also facilitates corruption.
Outside the ports, things are equally awful because of the dilapidated road infrastructure. Chaos prevails as trucks line up for days without reaching their final destinations. Exports suffer untold delays. The access roads need just N74 billion to fix, according to a 2018 estimate by the Federal Government. Given the revenue takings at the ports, the state of the roads is inexcusable.
UNCTAD states that port performance is a critical factor that can shape countries’ trade competitiveness. It adds that efficient and well-connected container ports, enabled by frequent and regular shipping services, are crucial in minimising trade costs, including transport costs, linking supply chains and supporting international trade. But congestion has defined operations at the Lagos ports for years. In 2011, the Goodluck Jonathan administration recognised this, leading to a reform that barred some of the MDAs from operating at the ports. The measure did not work primarily because the cargo handling equipment was inadequate and operations were manual. The MDAs exploited this to return after a few months.
It is inexplicable that after more than five years in the saddle, the regime of Major General Muhammadu Buhari (retd.) is unable to implement transparent reforms at the ports. In all this, the Nigerian economy is the victim. Already, the neighbouring ports in Benin Republic, Togo and Ghana have taken advantage of the mess to upgrade their capacities to absorb the inflow from Nigeria. A September study said because of the delays, cargoes meant for the Lagos ports are now being diverted 1,500 kilometres away to Point Noire in Congo before being transhipped back to Nigeria. With cargo dwell time of up to 20 days, global shippers, Hapag-Lloyd, said the delays at the Apapa ports were affecting its Middle East-Africa-India Express and Mediterranean West Africa Express services, leading to it often omitting the Lagos leg.
In financial terms, the loss is colossal. Whereas the global maritime trade is worth $4 trillion annually according to the World Shipping Council, Nigeria is losing $55 million (or over N20.8 billion) per day to its inefficient port operations, says Dynamar, a Dutch maritime research company. Being an import-dependent country, this negatively affects the Nigerian economy in various ways, including factory closures, high cost of goods, services, and job losses. The rates to transport goods inland have spiked astronomically. With Nigeria unable to fulfil its potential, UNCTAD names the ports in Morocco, Egypt and South Africa as the best connected in Africa.
To be fair, the incumbent regime – like the others before it – is conscious of the excruciating operational issues at the ports, but it has been more of rhetoric than taking holistic action to make the ports efficient and competitive. In May 2017, Vice-President Yemi Osinbajo rolled out an executive order on ports operations. The order, which was to be implemented within 30 days, approved the compulsory wearing of uniforms by officials, 24-hour operations to aid the efficient clearing of goods and banned touting. It failed. In May 2019, Buhari empowered a task force headed by Osinbajo to clear the Apapa access roads and bridges of trucks within 72 hours. The trucks are still occupying the roads after more than a year. Additionally, in September, the Federal Government awarded a 20-year concession arrangement valued at $3.1 billion to three companies in its bid to modernise operations at the ports.
The world is turning digital, faster than we could have imagined, and public administrations are moving online just as fast. Port operations without scanners are cumbersome, prone to corruption and delays. To realise its target of increasing maritime-to-GDP ratio from under 5.0 per cent to 10 per cent in the medium term, the Buhari regime should review the Customs operations immediately. The goal should be the incorporation of technology, devoid of physical or human interface, to drive the clearing process and installation of adequate cargo clearing equipment. This is how the largest ports in the world operate. Nigeria should join them.
Currently, there are too many MDAs contending for space at the ports. The Minister of Finance, Zainab Ahmed, should midwife another review that will cut down the number drastically, allowing seamless operations. Apart from swiftly completing the rehabilitation of the access roads, the government should intensify work on the connecting rail network to the ports, as road infrastructure is incapable of meeting the needs of transporting goods in and out of the ports. It should improve on the security architecture in and around the ports. Digital Customs will increase productivity, which will inevitably lead to greater economic growth, better job creation and increased poverty alleviation in the country.
