Eromosele Abiodun

hileitisaknown fact that international shipping is competitive and intricate, the confusion in the Nigerian maritime industry over shipping companies’ charges has over the years raised dust with stakeholders at daggers drawn as to who is right or wrong. Last year, customs brokers plying their trade at Lagos ports declared war on terminal operators and shipping companies over the N4billion demurrage accrued from the shelved strike by truck drivers. Also early last year, truckers shunned lifting of cargoes at the ports in protest over alleged extortion by security agencies. Resulting in over N4 billion accrued as demurrages and storage charges that importers had to clear.

THISDAY investigations revealed that N668million demurrage was incurred daily for the duration of the strike, which translated to N4billion. The humongous amount resulted in a running battle between clearing agents, importers on one hand and the service providers on the other. While the clearing agents were calling for waivers over the strike period, the terminal operators remained indifferent.

According to a manager in one of the container terminals in Lagos, the terminal operators collected demurrage accrued during the period.

The cost of doing business in Nigeria ports ranks amongst the highest in the world with the ports notorious for high demurrage charges as a result of a delay in cargo clearing process; High insurance premium of vessels coming to Nigeria and trucks conveying containers to and from the ports and higher shipping and terminal charges.

This is aside from the total annual freight cost estimated at between $5 billion and $6 billion annually, according to the Ministry of Transportation.

According to the World Bank in its 2017Annual

Ease of Doing Business Report, Nigeria ranks 145 among 185 countries with Mauritius ranking 32 as the best in Africa. From the report, Trading Across Borders, an indicator for measuring a country’s ports effectiveness ranked Nigeria very low at 183 out of 185 countries.

Numbers released by the Nigerian Ports Authority (NPA) showed that averagely, container traffic at the nation’s seaports across the country (Lagos Port Complex, Tincan Island Port, Delta Port, Onne Port, Rivers Port, and Calabar Port) stands at 822,868 annually.

THISDAY findings from customs agents revealed that it takes about N6.5 million to clear and transport a 20-foot container laden with cargo worth N36.42 million ($100,000) imported into Nigeria from China.

Of this amount, about N5.3 million (representing 82.1 per cent) is paid to the Nigeria Customs Service (NCS) as Import Duty, Comprehensive Import Supervision Scheme (CISS), ECOWAS Trade Liberalisation Scheme (ETLS), Port Development Surcharge and Value Added Tax (VAT), shipping companies are responsible for 13.8 per cent of the port cost (N897,000); terminal operators 1.8 per cent (N117,000); transporters 1.1 per cent (N71,500) and clearing agents (N78,000).

This means that N5.34 trillion is required to clear the 822,868 containers annually, while the shipping companies charges stands at N738.112 billion annually.

Alarmed by this development, the federal government engaged the shipping companies for almost two years, negotiating a reduction in port cost. Last month, the government, through its port economic regulator, the Nigerian Shippers Council (NSC), announced that it is to sign a landmark agreement with shipping companies that will see charges by shipping companies reduced by 35 per cent or N258.38 billion annually.

Ending Port Cost

Amidst the cheering news of the MoU signing came a bombshell revelation that the NPA has informed the Nigerian Navy of its decision to cancel what was hitherto unknown to many