Election Fever, Depreciating Naira Take Toll on Lagos Ports
Uncertainty over what would be the outcome of next month’s general elections and depreciating value of the naira have forced importers to put a hold on business, reports Francis Ugwoke
In the past few months, the nation has been gripped by election fever. With the past experience, particularly during the last general election, such apprehension cannot be out of place. The killings in some parts of the North by Boko Haram insurgents became more noticeable after the general election that produced Dr Goodluck Jonathan as the President. It started in the North East and has continued since then. Thousands of Nigerians have lost their lives. Many were forced to leave some parts of the North where they were doing one business or the other to other safer states. It is this development that has heightened tension in many parts of the country. The belief is that the country may be in turmoil more than what has been witnessed if a particular party did not win the Presidential race.
With concerns being raised by the populace, this situation is taking a general toll on the national economy. There have been reports of many foreign investors holding on to see the outcome of the general election before committing so much money to investment in the country. This is also the situation in the ports. And this started late last year. There is currently a lull in activities. Importers appear to be on break, apparently waiting for the issue of election to be concluded before ordering for goods as usual. But the election fever is not the only reason why some importers decided to put a hold on importation. The other issue is the depreciating value of naira. It has made cost of foreign exchange very high, a development that will affect prices of such goods. Activities at Lagos ports
For many importers and customs brokers, the postponement of the general election was not the best. To them, it is simply another delay on their business. They wanted a situation where the election is held once and for all so that they can continue their business as usual. But with the postponement to March 28, many of the importers will have to wait for too long before starting their international trade as usual. This has also affected customs brokers.
A visit to the Tin Can Island and Apapa ports shows the a lull in activities. Unlike before when custom brokers were seen in every corner of the port environment, very few of them are seen at the terminals and surrounding vicinity in recent time. At the Tin Can Island Port and PTML Terminal, many of the customs brokers were over-heard complaining of dull business due to the election. They also complained that the matter was made worse following the shift of the date. According to them, the implication is that the lull in business would have to last more pending when the election is concluded and a conducive environment created for business. Views of Stakeholders
At the ports, highly placed Customs officials could not hide their feelings about the effect that the general election has had on their revenue generation . The Area Controller, Lilypond Command of the Nigeria Customs Service (NCS), Comptroller Mustapha Atiku, who spoke in Lagos last week said that apart from the election, the depreciating value of naira had also affected business at the ports. He disclosed that the terminal was suffering as very few containers were being stemmed to the area.
Atiku disclosed that out of a monthly target of N1.9billion, the command was only able to collect N852 million in January and had as at last week collected only N198 million in February. He was in doubt as to the ability of the Command to meet up to what was realized in January. Similarly, the Commercial Officer, Lilypond Container Terminal, Mr. Kayode Daniels, also complained about the lull in activities at the port. Daniels said that the low level of activities has affected all the terminals in Lagos, including the biggest terminal in Nigeria, Apapa port. According to him, business volumes in terms of imports have dropped for some time now.
“Mearsk Line’s volume is 30 percent less than what they did in 2014. Market is slow; market is stagnant. We have done extensive market research with our customers and we find out that market is not moving. “It is slow. Their (importers’) complaint is that their warehouses are still stocked and there was no way they could import. “More so, people are not spending and when people don’t spend, it will be difficult to bring in imports. So these are the challenges that are leading to the drop in volume,” he said. Apapa, Tin Can Island Ports Suffer Low Revenue
In both Apapa and Tin Can Island ports, the revenue generation has been very low. In Apapa for instance, the Command recorded N20billion in January. A top official of the Command who attributed this to the election said the situation may not improve till the poll is conducted. At Tin Can Island Port, the Customs Command also recorded N21 billion for the month of January. Incidentally, both commands have a monthly revenue target of N28billion each. The Controller of the Customs Command, Mr Jibrin Zakare, said that the election was responsible for the poor revenue. Stakeholders Lament
Customs brokers who spoke to this writer also attributed the low traffic situation at the ports to the election. A customs broker, Mr Michael Okogwu, said that it should be expected that every year of the election, the first few months of that election suffer poor traffic situation as importers would want to wait and ensure that election is conducted peacefully before going into full scale trading. “No importer wants to bring in goods without being sure of the security of the environment, beginning from the ports to where the goods would be delivered”, he said.
Okogwu said that the situation would change once the election is held successfully in the country. According to him, the same situation applies to other big time investors, who he said, have held their money in safe places waiting for election to be conducted before full business. He added that the apprehension among importers is worsened by years of insecurity in the country.
Okogwu called on politicians to take the interest of Nigerians into consideration during the presidential election and other elective positions by ensuring a free and fair exercise that will not affect peace in the country. On the issue of depreciating value of naira to other foreign currencies, he called on the Central Bank of Nigeria to work hard to save the country from economic catastrophe before it is too late. He said except the CBN intervenes further, naira will continue to depreciate to a situation where it will soon nearly hit N500 a dollar.