By Okuneye Moyosola
Prince Adeyinka Bakare is the President General of the Nigerian Association of Air Freight Forwarders and Consolidators (NAFFAC). He is also a Governing Board member of the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN). In this interview with MMS Plus, he speaks about the state of freight forwarding in the country and sets his agenda for the maritime and aviation sectors in 2020. He also unveils plans to transform the association, even as he addresses several pertinent issues affecting the practice in the country.
Excerpts:
In the last quarter of 2019, the Nigerian Aviation Handling Company (NAHCO) and Skyway Aviation Handling Company (SAHCO) increased their charges. How is NAFFAC taking this?
We didn’t take it lightly and we issued a very strong press statement against it. They can’t just sit-down and take a decision to increase their handling rates by 70% without consulting the stakeholders. We also reported them to the Nigerian Shippers’ Council (NSC) and the Nigerian Civil Aviation Authority (NCAA). Both agencies came into the picture and asked them to suspend it until all the stakeholders were properly briefed.
After that, we went into series of meetings with the ground handling companies and the rate was reduced. We argued that the charges should be reduced to 30%, but they stressed that the rate had been the same for over 10 years. They also complained about the situation of things in the country and insisted on 40%. We are still talking and so far we have been able to come to an agreement.
POF collection begins next month and CRFFN has gotten approval from the Ministry of Finance for POF receipts to be used for cargo clearance. What’s your take on this?
It will become one of the conditions for cargo clearance either at land borders, seaports or airports from February, the period when it takes off. I think it is something that every freight forwarder should accept because it’s going to go a long way in training and empowering freight forwarders. I can tell you precisely that there is no indigenous company that is handling project cargo in Nigeria and that is a big shame for practitioners in the country.
We have a lot of projects going on in very part of the country such as the railway construction, airport construction as well as lots of oil and gas multinationals coming into the picture with large projects, yet no Nigerian freight forwarder is handling any of those projects. Majority of the people handling these projects are foreigners because they believe we don’t have the capacity and skills for the job.
If you look at the oil and gas business, you will see a lot of Nigerians coming up to be a big player because local content Act was encouraged. This is where we are going and if you don’t have money and the skillsets, you won’t be able to do any of these things. One of the things that would give CRFFN the wherewithal to train us is POF. We need to support it not because of CRFFN but because of the profession.
How would you rate the business of freight forwarding in the maritime sector as opposed to the aviation industry in Nigeria?
Maritime is bigger while aviation is just a straight line profession which has to do with air cargo and passengers. However, the maritime sector is a large one that has potentials to be more lucrative than the oil and gas, if properly harnessed. We are also lucky that Nigeria holds a strategic position in the maritime by virtue of its geographic advantage and the size of our population. We only have to make use of the human resources we have and everything that we must have to be able to build on that capacity as Nigerians.
Another problem that we have is the over dependence on foreigners. We need to look inwards and build that capacity within ourselves. If we have all the vessels trading on Nigerian waters owned by Nigerians or even 80%, this would be a great achievement for the maritime industry. The government keeps saying it would disburse the Cabotage Vessel Finance Fund (CVFF) to support indigenous ship-owners but nothing has been done. When these factors are in place and working, there will be an increase in the number of people that will be employed. There would be increase in employment and this would have a ripple effect on the freight forwarding practitioners.
The Nigerian Shippers’ Council (NSC) has said that one of its goals for 2020 is to stop the payment of container deposits. What do you think about this development?
There are some things that need to be argued logically. Is it what is practiced globally? If the answer is yes, then why do we need to stop it? The shipping line container deposit is just for security of their containers. However, if you look at the situation of the country with issues such as traffic and unavailability of holding bays, then the container deposit becomes a threat because immediately you drop that money and you are not able to drop the containers in time, automatically the money that you dropped will be tampered with.
The shipping company will keep deducting from the money as rentage for the container that you are not using. But if it could be stopped, they also need to look at how to manage the risk on the part of the shipping line releasing their empty containers to people that probably would drop it somewhere or may not even return it because there is no deposit.
Nevertheless, if it would be stopped totally, it is a good one. A lot of Nigerians are losing billions of naira to that on daily basis.
What are some of your expectations for the air freight industry in the year 2020?
Freight forwarding in general is going to experience a new dimension this year. We are trying as much as possible to change the perception about the profession. Although there have been some hiccups in documentations here and there, but in two or three weeks, we should be able to get that sorted out. We are also trying to ensure that it doesn’t affect any clearance procedure by the time this is done; we will have enough time to conduct trainings to restore the professionalism of freight forwarding.
We need to tell the world what we are doing. We need to let them know that the freight forwarding profession in Nigeria is not just a profession for drop-outs. Aspiring to be a freight forwarder should be as enviable as becoming a banker. I can’t perform a surgery without becoming a certified medical doctor and this also applies to the profession. You might be a B.sc or PhD holder but if you want to practice freight forwarding, you need to be trained on the profession. There has to be a certification that you must have to be a freight forwarder. It is wrong to view the profession as a place where people venture into just make money; freight forwarding business is entirely different from that.
In Nigeria today, if I have a Toyota car of 2010 to import and I bring three different cars into the country. One through Apapa, another through Tin Can and the last one through PTML, the three cars would pay different duties despite being in Lagos and with the same Customs. We are looking forward to a situation where regardless of where you are taking your cars to, the charges would be uniform. If the car models 2010, your charges would be 2000 and that will be the exact amount everywhere. We don’t want a situation where you would be driving the car and someone would say that the charges paid was not correct. That means they will have to tell us the correct charges needed to be paid. I hope that we would be able to achieve this before the end of 2020.
What are the challenges facing freight forwarders in the country and what can be done to address such challenges?
The major challenge we have is the lack of unity among freight forwarders because we are not speaking with one voice. Every agency that we are dealing with knows that we don’t speak in one voice. So, they maximize this opportunity to discuss with one association differently and say another thing to the other association. They use the divide and rule system to their benefit. This is one of the reasons why we had issues with NAHCO and SAHCO. We told them that if they want to meet all the freight forwarders, they should meet us all at the same time. We don’t want a situation where they would have separate meetings with each association.
The high cost of trucking goods remains a huge burden of freight forwarders while Customs excesses still prevails. What suggestions would you proffer to resolving these issues?
We are engaging them. We try as much as possible to speak and have a dialogue. We believe that at this stage it’s not about using force. There are things that we need to explain to each other so that we would come to an agreement. Although there are some overambitious officers but we will still use that dialogue and we are optimistic that these challenges will be history soon.
