Improving the Ease of Doing Business at Lagos Ports

By Timi Olubiyi, PhD

Where problems exist and persist, there are usually opportunities, such is the case of the perennial issues with the Lagos ports where the vessels, trucks, and cargo congestions persist, business opportunities abound.

The Lagos ports; the Apapa and Tin-Can ports, are the busiest in Nigeria and for this reason, congestions exist and cargo remained trapped inside the ports. This situation makes cargo evacuation difficult and this ultimately affects the ease of doing business in the ports and indeed around the ports environment.

These situations continue to hinder trade facilitation, free flow of traffic, and ease of doing business in and around the Apapa area of Lagos State. On the part of vessels calling at Lagos ports, extraordinary delays are suffered due to this congestion and the waiting periods at Terminals continue to exceed 20 days according to findings, which is bad for all known economic reasons.

Findings further indicate that the congestion at the ports is largely due to inadequate and ageing infrastructure, lack of automation, bad roads some of which are currently undergoing repairs, which make trucks remain stuck on roads for long hours and days.

Another significant reason is the state of the rail transport which has forced 90 per cent of cargo to go by road. These challenges are prevalent and from information gathered, some shipping lines sometimes divert Nigeria-bound cargoes to neighbouring ports.

So, with the perennial congestion and with terminal operators running very low on yard space, there is a need for a short to medium-term solution before the government comes up with a lasting resolution to resolve the challenges and ensure free movement of cargoes in and out of the port.

Therefore, opportunities exist in barge operations in the meantime to ease cargo evacuation processes at the Lagos ports. From indications, barge operations have been initiated by maritime regulators to reduce this congestion at the ports but it is high time more attention is paid to it and the benefits thereof.

For readers who are unaware of what a barge is, it is a wide and flat-shaped boat just like a raft built mainly for river and canal transport of bulk goods. The main reason for this particular shape is to ensure that the cargo-carrying capacity is enhanced and more bulk can be hauled and transferred on it.

So, because of its design and usefulness, the usage of barges can convey containers in and out of the ports conveniently.

Therefore, efficient and regulated barge operations can be an effective strategy to resolve the key challenge of congestions at the port and it may drastically reduce the pressure on the roads if adequately regulated and put to use.

In my view, barge operation if harnessed with adequate technology can improve the current situation at the ports particularly with the traffic gridlock in and around Apapa Lagos State.

Without doubts, the use of barge operation can reduce the dwelling time of cargo and turnaround time on vessels calling at the Lagos ports.

Further to this, using barges to evacuate cargo from the ports can become one of the sustainable ways of reducing the burden on Nigerian roads, in the meantime. Without further doubt, if the operation and set-up are done effectively, it can help reduce the overall cargo clearing cost.

In fact, if the services of barge operations are encouraged on our waterways into the hinterland the human and trailer traffic going into the ports will be reduced significantly.

In addition, if barge operation is effectively adopted the capacity of the port to receive more imports would be enhanced and more shipping lines will be encouraged to call at the Lagos ports.

Recall, Nigeria has the population, the market, the businesses and largely because of the import-dependent nature of the economy. Therefore, barge operation can become an important part of intermodal transportation in the country, which is a quick way to ensure seamless cargo evacuation from the ports

Currently, cargo from the ports is moved or evacuated mainly by trucking and a very low and insignificant size is moved by rail, so in the meantime, barge operations can help improve the evacuation technique at the ports.

Even from context observation, a large number of the traffic entering the ports is to deliver empty containers, an alternative to these drop-offs of empty containers can be through barges to the ports without the pressure on the roads and the long queues of articulated trucks at the port entries.

Recall, a truck most time can only transport a single container irrespective of the size of the container, however, a barge can take at least twelve (12) 40-foot containers at once.

Therefore, container barging can form key succour to the current congestion at the ports and promote ease of moving cargoes out of the ports.

A good illustration of how barge operation can be effective can be seen in the arrangement of moving 500 containers out of the Lagos ports in a day. The current situation will require 500 articulated trucks, however, only 42 flat container barges will be required to move the 500 containers to the hinterland, by this technique 500 trucks will be out of the road for that single day barge is considered. This will adequately decongest the port and the roads if the barge service impact is viewed over a week or a year.

In my opinion, the barge operations can easily compliment the already established architecture at the ports and ease the high volume of traffic in and out of the ports.

So, it is safe to say barge operations ought to be part of the architecture of the ports and consideration should be given to improve intermodal transportation around the country.

Considerably, for ease of cargo movement and to further promote ease of doing business at the ports, barge operations will not only assist, it will create jobs and also help to activate more new businesses in that ecosystem.

Port terminal operators (companies that operate terminals) may need to align their operations with that of barge operations and ensure that loading points for barges are created at their various terminals to grow and support this line of business. When a more enabling environment exists, it expands opportunities and such can be achieved at ports with barge operation.

In fact, it will drive job creation, promote more business creation and value-added services within the maritime sector. In reality, it will improve service delivery and the business competitiveness at the ports, truckers and haulage companies will eventually be challenged to innovate, reduce charges and improve on service delivery time.

In conclusion, there is a need to reduce the dwell time of cargo at the ports from twenty-one 21 days to the regional average of seven (7) days and also achieve efficient trade facilitation and ease of doing business at the ports, one of the ways to achieve this in the meantime will be through the use of barge services, in my view.

Therefore, to support this cause, key stakeholders in the maritime sector, regulators, government agencies: National Inland Waterways Authority, NIWA; Nigerian Shippers Council, NSC; Nigeria Port Authority, NPA; Nigerian Maritime Administration and Safety Agency, NIMASA; Nigerian Navy, Nigeria Police, and Lagos State Waterways Authority, LASWA need to work on the barge operation regulations, licensing and registration, market entry and exit modalities, setting service minimum standards and standardization, security, safety, insurance, tariffs, pricing, and others to ensure stable operations of barges in the country. Good luck and God bless Nigeria!

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Dr Timi Olubiyi is an Entrepreneurship & Business Management expert with a PhD in Business Administration from Babcock University Nigeria. He is a prolific investment coach, seasoned scholar, Chartered Member of the Chartered Institute for Securities & Investment (CISI), and Securities & Exchange Commission (SEC) registered capital market operator. He can be reached on the Twitter handle @drtimiolubiyi and via email: [email protected], for any questions, reactions, and comments.