Steve Agbota, [email protected] 08033302331
Before now, Nigerian ports were faced with numerous challenges that are yet to be resolved. The ports are known to be having problems of congestion, accessible roads, and cargo evacuation, now the Coronavirus (COVID-19) pandemic coupled with the recent lockdown have compounded the problems.
The spread of the pandemic, which is a significant economic threat has placed ports’ revenue and operations in jeopardy. Currently, vessels laden with goods do not come regularly to the Nigerian ports. There is drastic reduction in movement of cargoes presently. This will have huge implications on the nation’s economy, according to maritime experts.
Given the decline in the volume of import and export cargoes, experts also predicted that there would be corresponding drop in government revenue as Federal Government agencies such as Nigeria Customs Service (NCS) and other agencies that generate revenue from authorising these cargoes, would also lose out significantly. For instance, shippers said they have already lost N5 trillion in the last one month and there is reduction in cargo traffic at Nigerian Ports.
Recently, the Nigerian ports experienced skeletal operations as only essential cargo are allowed to be cleared due to lock down. Shipping companies and terminal operators are struggling to cope. Even as several vessels and thousands of Nigerian bound cargoes are currently trapped in Asian countries.
However, the container shipping industry could lose as much as $23 billion this year from reduced demand in the wake of the pandemic. This is because demand for unitised shipping services is set to nosedive as a result of the economic devastation wrought by large swathes of the world forced into social lockdowns.
Research from liner analyst SeaIntelligence Consulting indicated that the best carriers can hope for this year would be a 10 per cent decline in container volumes, compared with 2019.
Conversely, few of the major key components of the maritime economy, which include transportation and logistics have been badly affected. The coronavirus pandemic had taken the greatest toll on the transport industry globally because different modes of transportation such as air, water and land involved close contact with persons on board.
As a result of the pandemic and fear of contracting the virus, importers are no longer placing orders for cargo anymore especially from the high risk nations.
Ideally, cargo movement started from the manufacturing end or supplier end to the logistics part, and then to the port before it gets to the final destination. And each of these links had been seriously affected.
Manufacturing outfits, supply outfits, and industrial parks are closing down as people working there are pulling out, except in places that there is high automation. The goods now made cannot leave the factory and go to the logistics park without human contact and that brings people into closer confines and helps in the spread of the virus.
The link or chain has been really affected and that means that it is no longer efficient and this leads to importers not placing orders.
Recently, the Chairman of Nigerian International Maritime Ports and Terminals (NIMPORT), Mr Fortune Idu, said while governments globally discouraged massive movement of people, the transport industry had remained most vulnerable.
“Cargo movement has been seriously interrupted due to the Coronavirus outbreak.The cargo transport movement as it is today worldwide is being affected seriously as importers and exporters are responding to the coronavirus outbreak situation.
“Importers and exporters are not actually placing orders anymore, because they do not know when the pandemic will end, and the outcome of what is going on.The situation in the country and the world, in general, is one of high uncertainty, and industry stakeholders are responding to that,” he said.
Speaking with Daily Sun, Advisory Head/CEO, Kamany Marine Services Limited, Charles Okorefe, said the there is no way one will separate what is happening in other aspect of the world economy.
According to him, If there is a meltdown in the stock market for instance, around the world, one can imagine what will be happening to the shipping in the maritime industry because what is produced elsewhere will also have to be moved to other part of the world.
He added: “And because of the fear of this Coronavirus a lot of activities have scaled down. Even Government project cargoes that drive most of the shipments and logistics, Government are not looking in that direction now rather than they are only interested in how to chase this pandemic away.
“That already tells you that from the government side, which is a huge shipping project, that tells you that there is a lot of downturn or problems they face not to talk of individual or corporate importers and exporters who may one way or the other intend to seek for loan from the banks,” he added.
He said the banking system at the moment is down and even most of the banks are not operational.
“So where are you going to get the loan to transact that business and who are you going to deal with in the face of shutdown of businesses in every part of the world. So what we may experience in the post pandemic period will be a lot of chaos. Chaos in the shipping and terminal operations because a lot of cargoes have arrived and they cannot be cleared because some ports, especially in Nigeria at the moment, only essential imports including medicament drugs and things like that are the only things that can be cleared.
“We want to ask what happens to the other imports, luxury items and other things? So a lot of congestion will take place and that, of course, means demurrage payment and so on and so forth. So we only hope and pray that the damage will not be colossal.”