Nigeria’s Chaos, Benin Republic’s Gains

On a visit to Port Autonome de Cotonou, otherwise known as the Cotonou seaport, in Benin Republic, one may think he is at one of the seaports in Nigeria. Everywhere one looked at the Cotonou port, one will see Nigerians doing business. One of the registered forwarding and clearing agents at the Cotonou port, Mr […]

On a visit to Port Autonome de Cotonou, otherwise known as the Cotonou seaport, in Benin Republic, one may think he is at one of the seaports in Nigeria. Everywhere one looked at the Cotonou port, one will see Nigerians doing business.

One of the registered forwarding and clearing agents at the Cotonou port, Mr Femi Akinbowale, told Sunday Trust that he relocated his business from Apapa port in Lagos to Cotonou in 2001 after most of the importers doing business with his agency stopped using Nigerian ports and relocated to Cotonou.

“The situation at the Nigeria seaports made most of us to relocate to Cotonou where it is more conducive to do business. Despite the fact that Nigeria is blessed with eight major seaports, as against only one that Benin Republic has, Nigeria also has large deposits of mineral resources, like crude oil, steel, gold or bauxite. Benin Republic is managing its only seaport, divided into two terminals, in a way that it is not only attracting Nigerian importers and clearing agents, but also is today, the major port in West Africa.

“Many things are responsible for the failure of the seaports in Nigeria. First, as Nigerians, we are not serious in handling any public property or trust. Look at the foreign exchange black market at Krake, the Benin Republic side of Seme border. There is tight security there. The majority of the people doing business in that market are Nigerians. Nigerians are patronizing the Beninois for foreign currency exchange.

“Look at the good roads in Benin Republic from Krake, through Seme town, to Cotonou and up to the port. See the six-lane highway from Seme that expands to eight lanes as you approach Route de Porto Novo. The same roads expand to 14 lanes from Mivvo tollgate leading to the port. There is no single seaport in Nigeria that has such a fantastic access road. Access roads to and within seaports decide the cost of transportation of goods by road to and from the ports. Transporters will surely charge higher if the access roads to a port or within the port are bad,” he said.

From this reporter’s interactions with Nigerians at the Cotonou Port, it was discovered that most Nigerians doing business at the seaport were operating at Nigerian seaports previously. They were at Lagos, Port-Harcourt, Calabar or Delta ports.

Incidentally, the major importers of big cargo to Cotonou port are Nigerians. Large quantities of all the goods imported by sea through the Cotonou port are meant for Nigeria.  Noting the collateral damage that may have on the Nigerian economy, the World Bank in a report it released in 2011, warned Nigeria of the consequences of the high level of illegal importation of goods into the country through Benin Republic. According to the World Bank report, as much as N750 billion ($5 billion) worth for assorted goods are smuggled into Nigeria through Benin Republic alone annually.

The World Bank report also criticized the Nigeria Customs of not being transparent in its revenue collection, claiming that it has “enough evidence” that over $400 million (N6 billion) representing about 25 percent of the 2010 total annual revenue collected by the Customs Service is lost through smuggling activities across the land frontier borders.

While records at Port Autonome de Cotonou indicates that the port has been generating an average of CFA 204 billion (N51 billion) annually for the country, the eight seaports in Nigeria are still dependent on government, not only for the payment of salaries and allowances for the bloated staff of the Nigerian Ports Authority (NPA), but also for the provision and maintenance of ports facilities.

Another Nigerian doing business in Cotonou, Alhaji Ila Jada said the Cotonou port has all it takes to be a globally recognized port. He said the port is of standard and has modern equipment needed to operate a port anywhere. He said in doing import business at any of the seaports, one must take into account the issue of security, affordable charges and convenience among others, in deciding where and when to do business.

Alhaji Jada, whose office is at the Cantine Port Douane, said his agency is more into transshipment services. He said his agency has some drivers of Benin and Nigeria origin who drive second hand cars to destinations in Nigeria through illegal routes. He said the Cotonou port, built in 1965, was initially designed to handle two million tons of cargo per annum, but had begun to handle twice that quantity, due largely to Nigeria-bound cargo.

A Nigerian importer, Mrs Titilayo Omoniyi, said beyond the standard procedure, cheap services at the Cotonou port made most Nigerian importers to transfer their business to Benin Republic. Some of the goods on the ban list in Nigeria can be easily imported through the Cotonou port. She said while it is forbidden to import used tyres, clothes and textile materials into Nigeria, such items can be imported through Cotonou.

“At the Cotonou port, Customs is the only uniformed agency an importer has to contend with. There is no police interference in the inspection, no SSS, no NDLEA, SON, Quarantine and the likes. There is absolute sanity there. At Cotonou Port, there are two types of bill of lading. One indicates shipment (consumassion) by indigenous importers while the other (transit) identifies imports by Nigerians or other nationals. S10 signifies Nigeria-bound goods; S12 is for Burkina Faso while S14 is for Niger Republic which attracts the lowest tariff.

“As a way of encouraging us to continue to patronize them, the Benin government offers rebate to Nigerian importers. Apart from paying what is generally viewed as a healthy tariff system, the Nigerian importer in Benin is further granted 15 percent tariff less what is paid by his Beninoise counterpart. There is, however, a law which stipulates that no Nigerian importing goods meant for Nigeria through Benin Republic is allowed to sell his goods within the Benin territory. He has only three days to get his cargo across the border.

“For vehicles imported through Benin and transiting to Nigeria, the authorities insist that such vehicles must obtain insurance and registration numbers before they can be driven across the border,” she said.

A check at several notice boards at Cotonou port indicated that items allowed for import through the port are rice, wheat flour, textiles, second-hand clothing, second-hand cars and tyres, sugar, spirits, tomatoes (tinned and paste) second-hand fridges and air conditioning units, sorghum, vegetable oil and frozen chicken. Others are footwears, cosmetics, medical equipment, computer and telecommunication products.

Though Nigeria has banned the overland importation of most of these items, the Nigeria Customs Service has not succeeded in stopping their smuggling into the country. It is said that Cotonou handles some 350,000 second-hand vehicles imported from Europe into Nigeria every year.

A captain of a commercial ship operating from Nigeria before he diverted his West African base to Cotonou, Captain Abiodun Fatai, said Nigeria is not a conducive place for them to operate. He said piracy, bunkering, armed robbery, attack on pipelines and other criminal activities on the high sea and Nigeria’s waters have adverse effects on sailing to Nigeria. He said ships that berth at Nigerian seaports are charges high fees due to the multiple problems experienced along the Nigerian coastal waters.

A former Transport Minister, Alhaji Ibrahim Isa Bio, told a meeting of the West and Central African ministers and maritime administrators at an International maritime organization conference that took place in Abuja that the Nigerian government had procured 36 patrol boats to provide security on its waters and fight the menace of piracy, pipeline vandalism and other criminal activities at the coastal line and the Nigerian waters.

He also told the conference that in line with global practices, Nigeria has also established a Coast Guard that will be responsible for the security patrol of the sea and the Nigerian waters. He said the Nigerian Coast Guard is to be headed by a yet-to-be named retired Admiral of the Nigerian Navy. He said as an armless Coast Guard squad, the Coast Guards will be backed on patrol by armed naval men.

“The issue of security on the sea is not only a problem in Nigeria, but also in West African and even the Central Africa sub-region at large. We had a conference in South Africa and sometimes in October last year and it was one of the issues in the fore front of our discussions. We also had a meeting in Benin Republic and we also discussed sea piracy, armed robbery and bunkering on the sea. On our own part in Nigeria and at the regional level, there is what we call the Coast Guard that is being set up to host the regional Coast Guards for Nigeria, Togo and Benin. We have appointed a Regional Coast Guard Commander who is a retired Admiral. On our own part, NIMASA is responsible for the safety, security and maintenance of marine operations in Nigeria.

“There is a collaborative understanding between us and the Nigerian Navy. As you are aware, NIMASA is responsible for the protection of lives and property, safety and security of marine environment. However, they do not have the enforcement capacity because NIMASA inspectors do not carry arms. So, how can a person who does not bear arms, enforce, curtail or stop armed robbery? So, there is this agreement with the Navy that also has the same statutory responsibility for the safety of lives and property within our coastal waters,” Bio had told the conference.

The countries represented at that conference did not only support Nigeria’s initiative, but Benin and Togo Republics agreed to collaborate with Nigeria in the establishment of common Coast Guards that will jointly patrol the waters of the three countries.

Three agencies of the ministry of transport, the NIMASA, NPA and NIWA are into maritime and inland waterways business.  Managing Director of the Nigeria Ports Authority (NPA), Alhaji Umar Suleiman said his agency, the NPA, is collaborating with the Nigerian Navy in the area of security. He said NPA has given the navy some of its pilot carters that they are using for patrolling. He said the NPA has also bought three patrol boats for the Navy and are repairing some of their boats that have been out of use to ensure effective patrol of the sea and total security coverage of the ports area.

On the side of the National Inland Waterways Authority (NIWA), its Managing Director, Alhaji Ahmed Aminu Yar’adua, said the agency has bought some patrol boats that the marine police and NIWA staff will use to patrol the inland waterways.

Senator Umar Idris, the Minister of Transport, who is yet to explain what is wrong with the implementation of the Coast Guards plans to patrol the waterways, had presented a memo to the Federal Executive Council (FEC). He had told the council that the purpose of the memorandum was to seek Council’s approval for Strategic concession partnership with the Nigerian Maritime Administration Safety Agency (NIMASA) for the provision of platforms for tracking ships, cargoes, enforcement of regulatory compliance and surveillance of the entire Nigerian maritime domain.

Briefing Senator Umar Idris when he visited the new and old Delta ports, Delta Port Manager, Mr Obumneme Onuenyenwa, told the minister that the NPA had not been active at Burutu port due to the massive activities of militants in the area. He told the minister that most staff of the NPA deployed to the port have escaped from Burutu due to the activities of militants.

“We have problems of community restiveness, improper encroachment on port lands by people wanting to sell lands that belong to the port. Insecurity is a major problem affecting our operations here. Vessels call came down in 2007 due to the activities of militants, but picked up in 2008. We have problems of siltation caused by none dredging of the channels. The channels at the Delta ports were not dredged for the past 24 years even when others are dredged every year.

“However, with the amnesty granted to the Niger Delta militants by the Federal Government, the ports are beginning to pick up effectively now. The main activities around the ports in Delta State are on oil and gas. Liner vessels that carry vehicles cannot come to the ports here because they are wide. Availability of oil and gas decide ship traffic here,” he said.

The port manager expressed concern that most ships operating around the Delta ports are complaining that the volume of mud at the entrance to the ports is disturbing the smooth sail of ships in the area and the mud is capable of causing serious damage to the ships operating at the ports.

“Many captains of the ships passing through the ports wrote to me complaining about the concentration of the mud in the entrance to the port. That is why all those 7-meters vessels cannot easily pass there. You know, when a vessel enters there, it expands because of the mud and that makes it difficult to pass there,” he said.

He said most of the infrastructure at the ports are decaying because of under utilization following the non-patronage by foreign vessels. Link roads within the ports are described as death traps with several potholes obstructing free movement of trucks within the port.

Transport minister, while receiving the Senate committee on Marine Transport led by its chairperson, Senator Zainab Kure, assured that with the recent reforms at the Nigerian ports, especially the streamlining of the agencies at the ports, the stage is set for the quick clearance of goods. He said the target of 48-hour cargo clearance will be realistic and reduce the  the diversion of ships to ports of neighbouring countries.

He said the wrecks and derelicts on the nation’s waters also constitute problems to smooth sail by ships. He said the extensive cost requirement of the exercise was stalling the removal of the other identified ones.

The visiting chairperson of the Senate Committee on Marine Transport, Senator Kure, observed that, having visited some establishments and interacted with operators in the industry, the potentials are, indeed, enormous, adding that there is a lot of ignorance about the challenges inherent and what the industry is capable of doing for Nigeria.  She said she is particularly delighted about the development of the Greenfield ports as this will make it possible for bigger ships to enter the territorial waters of Nigeria, translating into more revenue for the country.

Hajia Kure also said that the concessionaires at the ports believe that the government can still do more for them, especially, in the provision of infrastructure, particularly roads and rail systems.

The problem of maritime service and port operations in Nigeria is an open and closed case. In a ministerial committee report submitted to former transport minister, Yusuf Suleiman, which recommended that after the concession of the ports, an independent economic regulator for the ports should be appointed to regulate activities of the concessionaires operating at the ports. A bill for the establishment of the National Transport Commission (NTC) is before the National Assembly. However, there are indications that some agencies in the sector are frustrating the establishment of the NPC. If a regulatory agency is established, apparently, some of the powers of the NPA will be taken away. Insiders in the industry have argued that unless the NTC is established, a technical board put in place to take over the current functions of the NPA, cost of port services in Nigeria will remain high.

Sunday Trust was on the entourage of the Senate Committee on Transport investigative committee to Benin Republic recently.