Experts say Nigeria losing N10billion daily due to Apapa gridlock

Experts have said Nigeria is losing as much as N10 billion daily over the lingering gridlock on the roads leading to and from Apapa.

In a report by Sunday Telegraph with the Federal Government yet to find a lasting solution to the Apapa gridlock, experts have pointed at indications showing a whopping N10 billion is lost to the economy loses daily.

Describing it the worst logistics crisis ever since the famous Cement Armada crisis of the 1970s, the report reveals insight into the problem as well as solutions offered by the experts.

“Sunday Telegraph survey shows that no fewer than two to three thousand trucks from different parts of the country litter the streets of Apapa, Amuwo Odufin, and overflow into Badagry Road, Oshodi Road and Ikorodu Road every day.

“It was revealed that whether these trucks are going in or leaving the ports or Tank Farms, it will take them over one month to access the ports and another one month to get to leave or get to their destinations in or outside Lagos. And for that period, the shipper (importer or exporter) pays one form of surcharge or the other to the Shipping companies and Terminal Operators while the export or imported goods would get to the port of destination or the importer’s warehouse destroyed especially perishable and other consumable goods.

“Speaking in an interview in Lagos, port industry analyst and President of National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), Mr. Lucy Ameiwero, said the situation in the Lagos ports has reached an emergency situation, saying businesses in Nigeria today that import or export anything is in serious danger of going under if has not already because of the logistic crisis the country is facing as a result of the Apapa gridlock.

“Over a hundred companies that had their operational base in Apapa because its nearness to the port have either gone under already or relocated to locations outside Apapa which means that they are struggling because of the logistics to getting their raw materials from the ports,” he said.

“Though Nigeria has six seaports across the country, the Lagos Port Complex, Apapa and the Tincan Island Ports, handle over 80 percent of all Nigeria’s imports and exports excluding oil and gas.

Mr. Lucky Ameiwero said there is no way any business can survive in the country in a situation where a distance of less than three to five kilometres from the Lagos ports cost over N2million to transport a container, even as it will take the trucker over two to three weeks to complete the two to three kilometers journey which ordinarily should not take up to 30 minutes.

Focusing on Massilia Motors, a subsidiary of CFAO and Dangote Sugar Refinery Plc, the reports adds loss of revenue beyond double digits, as high as 26% for just a quarter.

MD of the CFAO subsidiary, Thomas Pelletier, said: “We are still around because of our faith in Nigeria. How can the business survive when the cost of transporting a container from Apapa Port to our warehouses in Amuwo Odofin or Ijora is higher than the freight paid on the container from Japan to Nigeria?

“Businesses in the country are in quagmire over this logistics crisis caused by the Apapa traffic gridlock. Businesses have become unprofitable and unattractive for further investment.”

In the case of Dangote Sugar Refinery Plc, Nigeria’s biggest grower of the sweetener, the report says the traffic gridlock in Apapa as well as illegal, low-quality imports are putting pressure on its selling price, and hampering delivery to customers.

“Sales and production volumes were constrained’’ in 2018 because of “these challenges,” the company said in an emailed presentation to Reuters.

“The company, owned by Africa’s richest man, Aliko Dangote, said revenue dropped 26 percent to N150.4 billion ($418 million) in 2018 while net income retreated 44 percent to N22.2 billion,” it added.