Poor maritime connectivity threatens AfCFTA success, Shippers’ Council warns

The Nigerian Shippers’ Council (NSC) has lamented that poor connectivity within Africa is responsible for the rerouting of goods through Europe, which drives up shipping costs and makes trade expensive in the region.

The Executive Secretary of the NSC, Pius Akutah, warned that failure to address the logistic challenges could hinder the implementation of the African Continental Free Trade Area (AfCFTA) Agreement.

He stated that connectivity within the African region is a significant challenge, questioning how goods will move within Africa if Nigeria does not promote an intermodal system of transportation to boost maritime trade.

Akutah made these remarks during a media briefing with editors and maritime reporters in Lagos to mark his one year in office. He noted that goods leaving the shores of any African country are likely to end up in Europe before they are rerouted back, a challenge that is both time-consuming and costly.
This situation, he added, burdens businesses within the maritime sector with high logistics costs.

Akutah said to position Nigeria as a maritime logistics hub for Africa, the NSC is actively seeking partnerships with global shipping companies. Akutah disclosed that the council has begun discussions with several major players, securing commitments to invest in the country’s burgeoning maritime infrastructure.

He highlighted the NSC’s goal of encouraging international shipping companies to use Nigeria’s ports as a primary transshipment point. Akutah noted that the NSC has already secured commitments from global companies and envisions seamless transshipment between Nigeria and other African countries, including landlocked ones, particularly the strategic infrastructure at key Nigerian ports like Apapa and Onne.

He said as the port economic regulator, the NSC aims to ensure that investments yield profitable returns while building the necessary infrastructure to facilitate the efficient movement of goods.

Looking ahead, Akutah revealed that the NSC is preparing to attract over $10 billion business investment plan for five years, aimed at boosting the country’s economic growth through trade facilitation and port management.

Additionally, Akutah noted that the Council’s Regulatory Services Department has saved the economy over N40 billion in the past year through reduced freight, party charter, and other shipping fees.

He stressed that the economy would have suffered without these savings, which resulted from the introduction of an automated app launched eight months ago to assess the reasonableness of such fees in the shipping industry.

Moreover, Akutah reported that the NSC compliance unit saved an additional N6 billion by resolving conflicts through alternative dispute resolution (ADR), avoiding the high legal fees typically associated with such disputes.

He stated that these efforts have averted potential disruptions in maritime activities, protecting the economy from further losses. Beyond cost savings, Akutah said the NSC has been actively engaging stakeholders nationwide.

Akutah noted that during a recent outreach in Kano State, a trade issue involving a $70,000 deal was successfully resolved within 48 hours. Such engagements, he said, have fostered trust and efficiency across the sector.

He explained that this model will require Know Your Customer (KYC) profiling, ensuring containers are returned in good condition rather than imposing high container deposits.

The insurance regime, he added, could resolve disputes over container misuse and damage, reducing associated costs and easing the financial strain on exporters.