Cargo tracking reforms linger despite $500m yearly losses

As discussions around the International Cargo Tracking Note (ICTN) continue, with $500m lost yearly to non-implementation, stakeholders hope for a resolution that would ensure that shipping costs remain manageable for businesses, ADAKU ONYENUCHEYA reports.

The implementation of the International Cargo Tracking Note (ICTN) in the second quarter of 2025 has garnered criticisms and support from stakeholders in the maritime sector despite the $500 million lost yearly to its non-implementation.

Nigeria is at a crossroads, grappling with a digital shift that promises significant benefits and challenges. The introduction of the ICTN has sparked debate within the industry.

While it intends to enhance transparency, security and operational efficiency of maritime trade in the country, its implementation has continued to stir controversy over the financial implications for businesses at the ports.

Advocates praise the initiative for its potential to streamline Nigeria’s maritime operations, while strong opposition warns that the system could prove costly and burdensome for local stakeholders.

Obstacles to ICTN implementation
Since its introduction 21 years ago, the ICTN has faced external threats and internal challenges, including backroom negotiations, financial mismanagement, personal interests, bureaucratic bottlenecks, and unhealthy rivalries among government ministries and agencies.

The scheme was suspended and abolished in October 2011 before being reintroduced in 2019. Since then, it has faced delays in implementation. The administration of former President Muhammadu Buhari engaged five companies for the contract, and approval was granted, although the process that led to the contract’s approval was flawed.

According to the Director of Maritime Services at the Ministry of Marine and Blue Economy, Babatunde Sule, there was a fake approval concerning this contract, as four companies signed an agreement while the fifth did not.

The Nigerian Shippers’ Council (NSC) had signed an agreement with Antaser Limited and four other companies on a “no cure, no pay” basis, with a revenue-sharing ratio 60:40 between the Federal Government and the consortium, respectively.

A consortium led by Antaser Nigeria Limited was engaged in 2023 to implement the system for all imports and exports, including crude oil exports. However, in 2024, the Federal Government awarded the contract to P-Lyne Energy Limited, with the expectation that the company would provide technological solutions for the oil and gas sector.

During a plenary session at the National Assembly, the Executive Secretary/Chief Executive Officer of the NSC, Dr Pius Akutah, stated that the investigation led by the Economic and Financial Crimes Commission (EFCC) had delayed the implementation of the system, halting its progress. According to Akutah, the country has lost $2.5 billion over the past five years, which equates to $500 million yearly, due to the non-implementation of the ICTN.

The Chairman of the House Committee on Shipping Services, Abdussamad Dasuki, emphasised that the goal is to identify the root causes of these delays, address conflicting interests, improve revenue generation by closing the loopholes that allow illicit cargo, such as arms and drugs, to slip through the ports, and ultimately unlock the potential of the ICTN to bring Nigeria’s maritime industry in line with global best practices.

Meanwhile, the ICTN bill has been passed by both chambers of the National Assembly, the House of Representatives and the Senate, and is now awaiting presidential assent.

However, Akutah noted that the bill is undergoing a “cleaning” process as part of the final steps before it becomes law. He explained that the delays were mainly due to past contractual issues but assured that the Minister of Marine and Blue Economy, along with key stakeholders, is actively working to resolve them.

Benefits of ICTN
The ICTN system is designed to track and monitor cargo as it moves through the global supply chain. For Nigeria, which handles about 70 per cent of the cargo destined for Africa, the ICTN offers several advantages that could elevate its maritime industry to global standards.

One of the primary goals of the ICTN is to enhance security by ensuring that every shipment is properly documented and tracked. With its implementation, authorities can easily monitor and verify cargo movements in real-time, significantly reducing the risks of fraud, smuggling and cargo theft.

This is particularly crucial in West Africa, where illegal activities in maritime trade remain a major concern. In November last year, the Nigeria Customs Service (NCS) returned 21 stolen luxury vehicles worth over N1.8 billion to Canada after they were smuggled into Nigeria by a criminal syndicate.

The Controller General of Customs, Bashir Adeniyi, raised the alarm that Nigeria has become a significant hub for stolen vehicles in West Africa, with syndicates exploiting the country’s ports and borders to traffic vehicles from regions such as Europe, North America and South America.

Additionally, data from the National Bureau of Statistics (NBS) revealed that only 54 per cent of stolen vehicles were recovered between 2013 and 2015, highlighting the scale of the problem.

This is in addition to the surge in the importation of illegal arms, ammunition, and hard drugs smuggled into the country through the seaports. By digitising cargo tracking, Nigeria can streamline customs procedures. Importers, exporters, and port authorities will have access to real-time information, accelerating the clearance process and minimising delays at the ports.

This could reduce the overall cost of doing business in the country, ultimately making Nigerian ports more competitive than their regional counterparts. The ICTN aligns Nigeria with global best practices, bringing it closer to international maritime standards.

With the growing emphasis on trade facilitation through technology, adopting the ICTN will enable Nigeria to integrate more effectively with global logistics and shipping networks, attracting foreign investors and facilitating smoother international trade.

Akutah reiterated the importance of implementing the ICTN, emphasising its potential to significantly boost national revenue and enhance the security of incoming cargo. He highlighted that the ICTN is expected to generate economic value by improving cargo tracking and increasing revenue through better shipment monitoring.

“Every stakeholder is yearning for the implementation of the ICTN because of the economic value it will bring to the country in terms of revenue generation and cargo security,” Akutah stated. He also noted that the ICTN is one of several key initiatives the Nigerian Shippers’ Council is relying on to drive financial growth in 2025.

The Head of the Sea Empowerment and Research Center (SEREC), Eugene Nweke, defended the ICTN, arguing that its implementation would bring much-needed efficiency, improve cargo tracking, enhance import data accuracy, and strengthen regulatory oversight by the NSC. He stated that improving compliance and transparency, the ICTN will make Nigerian ports more competitive and efficient.

Nweke called for the immediate adoption of the ICTN, expressing confidence that its benefits would be evident once fully implemented, ultimately proving critics wrong.

For shippers struggling with excessive charges, SEREC insists that reforms are necessary to create a more transparent and business-friendly port system.
Stakeholders’ concerns

The implementation of the ICTN has not been without controversy. While proponents argue that the system offers long-term benefits, critics highlight significant short-term challenges, including high implementation costs, bureaucratic hurdles, and its impact on local operators.

One of the most vocal criticisms of the ICTN system is its cost. Maritime stakeholders, including shippers, importers, exporters and freight forwarders, have expressed concerns about the additional financial burden associated with adopting the system.

The requirement to obtain an ICTN for each shipment adds another layer of administrative expenses, which may discourage smaller businesses from engaging in international trade.

The maritime business community is already burdened with multiple levies, taxes, and charges imposed by government regulatory agencies, shipping companies, and terminal operators.

These costs contribute to the high expense of clearing goods at Nigeria’s ports, making the cost of doing business in the country 40 per cent higher than in neighbouring countries.

This added financial strain could have broader implications for an economy where small and medium enterprises (SMEs) play a critical role.
While ICTN is intended to streamline customs and port operations, some stakeholders fear it may introduce additional bureaucratic red tape.

The lack of adequate infrastructure and capacity within Nigerian ports has been cited as a major obstacle to smooth implementation. Delays in issuing ICTNs due to poor technological adoption, inefficient services, and complex compliance requirements could worsen existing port inefficiencies and further frustrate stakeholders.

Smaller businesses, particularly those in the logistics and transportation sectors, could face serious challenges in adapting to the ICTN system. The financial burden of compliance may disproportionately impact these businesses, potentially forcing them out of the market or reducing their competitiveness.

The President of the National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), Lucky Amiwero, has strongly opposed the ICTN, arguing that it is not backed by law and would create additional procedural delays in an already cumbersome port operation system. He further contended that implementing the ICTN would lead to legal contradictions, duplicate processes, and impose extra costs, ultimately obstructing trade efficiency.

Amiwero pointed out that under the Trade Facilitation Agreement (TFA), fees related to imports and exports must be transparent and tied to legitimate services, something the ICTN does not appear to satisfy.

He also noted that the Nigerian Customs Service Act (Sections 28 and 35) already mandates using an electronic system for cargo tracking and pre-arrival processing, placing these responsibilities under the jurisdiction of the Nigeria Customs Service (NCS).

According to him, the law designates the NCS as the lead agency responsible for facilitating the exchange of information between government agencies and traders.

Introducing an additional tracking system under a different agency, he argued, is legally questionable and inconsistent with existing regulatory frameworks governing the import and export sector.

Similarly, former President of the Shippers Association of Lagos (SAL), Jonathan Nicol, has raised serious concerns about the reintroduction of the ICTN and the potential burden it could place on Nigerian shippers.

Nicol emphasised that while the ICTN itself is not a new requirement, the additional charges associated with its implementation could significantly increase shipping costs and negatively impact businesses. He explained that the ICTN was initially introduced as a tracking document for consignments and was agreed upon with the understanding that it would not involve extra charges.

However, he expressed disappointment that the current push for ICTN implementation now includes additional administrative costs, which would be transferred to shippers. Nicol also noted that shipping companies originally covered ICTN-related costs, but under the new structure, these expenses would be shifted to shippers, further increasing financial pressure on businesses already struggling with high operational costs.

Meanwhile, the Executive Secretary of the Nigerian Shippers’ Council, Dr. Pius Akutah, sought to reassure stakeholders, dismissing concerns that the ICTN would lead to additional business costs at seaports.

“I don’t think there has been any concern from any quarter regarding costs associated with the implementation of the ICTN. Rather, stakeholders are eager to see it take effect because of the security it provides for cargo entering our country,” he stated.

Success stories
Despite concerns raised in Nigeria, several countries worldwide have successfully implemented cargo tracking systems, reaping substantial benefits. South Africa has been a leader in adopting technology-driven solutions within its maritime industry. The country’s cargo tracking systems have significantly reduced port congestion, improved cargo clearance times, and enhanced supply chain transparency.

By investing in digital infrastructure, South Africa has remained competitive in the global maritime industry, attracting more international trade and boosting its economy.

As a global maritime hub, Singapore has long embraced digital solutions in its port operations. Its Smart Port initiative, which includes advanced tracking systems, has made it one of the most efficient and secure ports in the world.

The integration of ICTNs into Singapore’s logistics network has improved supply chain visibility and reduced delays, serving as a model for other countries to follow. The United Arab Emirates (UAE) has also successfully implemented advanced cargo tracking technologies, leading to greater logistics efficiency and a more secure shipping environment.

With world-class ports in Dubai and Abu Dhabi, the UAE has set a high standard for cargo tracking systems, attracting global businesses to use its ports as major transhipment hubs.

While other nations have successfully implemented cargo tracking systems, Nigeria lags as ICTN adoption controversy continues. The Shippers’ Council boss, expressed optimism that with continued efforts from the Ministry of Marine and Blue Economy and key stakeholders, Nigeria will soon experience the security and economic advantages promised by the ICTN system.

While ICTN holds significant potential for transforming Nigeria’s maritime industry, its implementation requires careful consideration of local realities. If properly executed, the system could be a game-changer, enhancing security, transparency and efficiency while aligning Nigeria with global maritime best practices.

However, challenges such as high implementation costs, system complexity, and potential negative impacts on smaller businesses cannot be overlooked. Stakeholders advise that Nigeria must learn from the experiences of other countries and tailor the ICTN rollout to its unique needs.