LCCI worried about impact of poor logistics sector on economy

Despite the opportunities in the global logistics sector, the Lagos Chamber of Commerce and Industry (LCCI) has expressed worry about the slow-paced growth of the sector occasioned by poor infrastructure thereby affecting operations in the services and manufacturing sectors.

According to the chamber, the deplorable state of roads leading to the Lagos Ports – Apapa and Tincan Island Ports, both of which account for over 60 per cent of the cargo into the Country and an estimated 70 per cent of customs revenue, has begun to take its toll on the private sector, economy and the citizens.

Presenting LCCI’s review of the economy to the media, its President, Dr. Nike Akande decried the parlous state of the roads, describing the effects as multifarious and mainly affecting the ease of doing business in the state.

Although the World Economic Forum notes that the future of Global Value Chain in manufacturing is dependent on effective logistics service, the LCCI stated that poor infrastructure continues to result in delays in getting raw materials and other inputs from the Ports to the factory premises in Lagos and other parts of the Country.

Akande added that the poor state of the roads has led to high cost of transportation for evacuating cargo because of the prolonged engagement of the trucks by importers arising from the delays, as well as high demurrage paid by importers to Terminal Operators and Shipping Companies as a result of delay in the clearance and evacuation of cargo in the Ports.

Already, she noted that the situation has also led to serious traffic congestion along the roads leading to the Ports, which often spills over into the Lagos Metropolis causing severe traffic jam and loss of man hours in Lagos, while resulting in risk to the lives of citizens arising from Containers falling off the trucks as a result of bad roads.

“We acknowledge the steps being taken to fix roads. But, there is need for urgent palliative measures to sustain movement of traffic in this axis”, she added.

Beyond the GDP numbers and the exit from recession, Akande emphasised the need for government to appraise its policies alongside the impact on the cost of doing business, productivity of the investors, competitiveness of firms and the sustainability of investments.

“To the average Nigerian, what matters is the effect on welfare, especially food prices, cost of healthcare, transportation cost, power supply and the purchasing power. These are the considerations that would determine the extent of celebration ultimately. Remarkably, the President himself (Muhammadu Buhari) lent credence to this fact.

“For Nigeria to thrive and create jobs for the growing population of our youths, there is need for a paradigm shift from been a single product (Oil) economy to the pathway of diversification, especially into non-oil export.

“For our country to sustain the momentum of recovery and the current positive outlook, we need to ensure the reduction in multiplicity of exchange rates; alignment of procurement policies at all levels of Government to support domestic investment; investment policy that would protect domestic investors; create a tax policy that is investment friendly; have an interest rate policy that is investment friendly; and develop a trade policy that will reduce cost of operations across sectors”, she said.