Nigeria’s ports, once a leading trade hub in West Africa, are losing competitiveness due to escalating charges and inefficiencies. The surging costs imposed by multiple government agencies, terminal operators, and shipping companies drive businesses to Ghana, Togo, and Benin. This trend underlines suspicions that Nigeria has lost the plot to optimise its vast maritime resources, and the consequences are hitting home hard.
Port charges have surged almost 100 per cent over the past month, making cargo clearance more expensive. The Nigerian Ports Authority recently increased all port dues and tariffs from 7 to 15 per cent. Terminal operators and shipping companies have raised fees by 15-45 per cent.
Importers are burdened with various government-imposed fees. The Standards Organisation of Nigeria and NAFDAC each charge N500,000 for certifications. The National Environmental Standards and Regulations Enforcement Agency imposes fees ranging from N150,000 to N200,000. In addition to these official charges, unofficial payments are routinely made to expedite clearance.
Clearing costs have ballooned to extortionate levels. The total cost of clearing a 40-foot container has risen from N18 million to N26 million while clearing a 20-foot container now costs N20 million—nearly double the previous average of N10.5 million.
It now costs over N4 million to clear a used Toyota Corolla. For businesses importing raw materials, the suspended 4 per cent levy imposed by the Nigeria Customs Service means they would have paid 80 per cent more administrative fees.
The rising costs and inefficiencies are denying Nigeria much-needed revenues and trade opportunities. Nigeria, once the destination for 70 per cent of West African-bound cargo, now handles less than two million twenty-foot equivalent units. Much cargo is being rerouted through neighbouring countries, resulting in significant economic losses.
The Minister of Marine and Blue Economy, Adegboyega Oyetola, admitted that doing business at Nigerian ports is 40 per cent more expensive than in other West African countries.
It is distressing that while other countries are reaping billions of dollars from port operations, Nigeria, with several ports dotting the country’s 800-kilometre coastline, continues to lag due to a lack of adequate investments, a chaotic operating environment, and high costs.
In 2024, the Port of Antwerp-Bruges in Belgium handled 278 million tonnes of cargo, including 13.5 million TEUs, generating $33.3 billion in value-added, equal to 7.0 per cent of the country’s GDP.
The Netherlands’ ports handle approximately 15 million TEUs of cargo annually, earning $ 27.3 billion in revenue as of 2021.
In contrast, the NPA and other maritime agencies generated N850 billion ($562 million) last year.
The cumulative effect of high port charges on Nigeria’s inflation is significant. With 80 per cent of Nigeria’s trade transported by sea, port-related costs directly impact production expenses and the cost of imported goods.
The Director-General of the Manufacturers Association of Nigeria, Segun Ajayi-Kadir, warned that further tariff increases would lead to higher production costs, making locally manufactured goods less competitive. This would exacerbate Nigeria’s inflation crisis, reduce the purchasing power of consumers, and increase unsold inventory.
Beyond high costs, port inefficiencies remain a major challenge. Importers face excessive delays and mounting demurrage fees, which are N68,500 per day for a 40-foot container and N48,000 for a 20-foot container.
To restore Nigeria’s competitiveness, the government must suspend further tariff hikes and conduct a review of the current port charges.
Digitising clearance processes, improving storage facilities, and increasing coordination between agencies can significantly enhance operational efficiency.
If it has high-definition scanners, the NCS does not need to inspect every container physically. The extortion rackets at the ports run by multiple security agencies must stop.
The Tinubu administration must look beyond its fixation on revenue generation and implement a comprehensive overhaul of port operations with special attention to other key ports in Warri, Port Harcourt, and Calabar to ease the congestion in Lagos.
