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Nigeria loses N3.5tr yearly to poor ports infrastructure

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Tincan Island Port, Lagos

Nigeria’s routine losses appear unending, as the Nigerian Logistics and Supply Chain Industry estimated N3.4 trillion yearly shortage caused by poor infrastructure, policy implementation and corruption at the nation’s ports.

The report published by Africa Centre for Supply Chain (ACSC), stated that the profit margin of corporate entities, especially those who make use of the Lagos ports, have gradually declined, as a result of increased costs of logistics.

The report, which gave insight to the looming issue of dilapidation of the nation’s infrastructure and those critical to the logistics and supply chain, cited sharp fall in the logistics performance index that saw Nigeria drop to 110 in 2018 from its previous position of 90 in 2017.

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Reeling out the chains of complications around the nation’s major port, the report noted that dilapidated roads, among other infrastructural problems and the consequent chaotic traffic situation, have made the gateway inordinately difficult.

It noted that it is now expensive to transport goods, attributing these to a N2.5 trillion loss in corporate earnings across various sectors of the economy and linked with spending on logistics.

Specifically, in fourth quarter (Q4) of 2018, the cost of hauling 40ft container within Lagos went up by 400 per cent, from N120,000 to between N550,000 and N600,000.

The development was also similar in transporting containers to different parts of the country, which rose about 66.7 per cent and 120 per cent for a 20ft container to Kaduna and Onitsha respectively.

These challenges, on the other hand, point to loses to exporters as well, especially those dealing with agricultural produce, as they lose $10 billion yearly, resulting from gridlocks on ports access roads, with containers bearing these produces spending weeks and eventually, fail to get access to the port terminals on time.

The consequence of such delays has been reduced quality of the goods and rejection upon arrival for failing to meet required standards, the report said, adding that the existing infrastructure when compared with the current population size of the country, and it’s growth rate, shows inadequacy and imbalance.

The Director-General, Africa Centre for Supply Chain, Obiora Madu, while speaking to The Guardian, said the deficit in infrastructure and decadence is a true reflection of leadership negligence.

“There’s over 50 per cent deficit in infrastructure. How we got here was obvious negligence. In those days, you remember that there were rail lines to all the ports and containers were rolled out, but we didn’t do anything to maintain them.

“The roads were neglected and the rail actually died, literally, and is just being revived. The aviation industry hasn’t been the best. We had a national airline, which we also ran aground and that’s how we got here. It’s purely neglect, on the part of the government, because government provides infrastructure,” he said.

The report showed that Nigeria’s position on the Global Competitive Index, has been a negative trend since 2014, with a score of 47.53 points and ranks 115 on this Index, while Kenya and South Africa, score 53.67 and 60.76 respectively.


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