Following the arbitrary increase in shipping charges by the multinational shipping firms by over 400 percent, the Federal Government has taken a bold step to protest the indiscriminate charges as organized private sector (OPS) groups and shipping stakeholders kicked against the increment.
Nigerian Shippers’ Council (NSC) hosted an array of stakeholders including shippers, freight forwarders, various chambers of commerce, manufacturers and other port stakeholders in a crucial summit where all parties agreed that the move by global shipping companies should be stopped.
In a bid to galvanize support to curb the huge surcharges on Nigerian-bound cargoes, NSC led the industrialists under the aegies of Manufacturers Association of Nigeria (MAN), Lagos Chamber of Commerce and Industry (LCCI), Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA), and the Nigerian shipping community to resist the arbitrary charges.
The 2020 peak period charges range between $1000 and $1,500 per twenty-foot equivalent unit (TEU) by shipping firms, is over 400 percent increase from the previous $200 freight charge per TEU during peak period.
Speaking at the event, the Executive Secretary, NSC, Mr. Hassan Bello, said, “this increment is scary and there is no explanation or justification for it. If a Nigeria-bound container is charged as much as $1000, then the national economy is in trouble.”
He expressed worry that the surcharge was introduced at a time when the nation was already slammed with numerous arbitrary charges, coupled with the tough economic effects of the COVID-19 pandemic.
Lamenting that the charges would lead to a spiral inflation rate on the economy as cargoes will be abandoned at the ports, he said; “it means job losses and many shippers will be out of business. These charges are astronomic, unjustified, not notified and discriminatory. This is against fair trade facilitation rules.”
The NSC boss noted that the Council had written to the erring firms and was awaiting the responses according.
“We have also written to Ministry of Transportation to escalate it to Ministry of Trade and Ministry of Foreign Affairs, and the Federal Government will protest the charges. We have been having surcharge in the range of $200 to $400, but 400 percent increase and there was no time limit. It’s already going to nine months and this is not what any economy can cope with. This can cripple the economy,” Bello said.
Meanwhile, the Managing Director, Nigerian Ports Authority (NPA), Ms. Hadiza Bala-Usman expressed disappointment about the charges, stating that it might result to more cargoes being abandoned at the ports.
Usman, who was represented by the General Manager, Tariff and Billings, Abubakar Garba Umar, said, “If the importers are charged so high and they abandoned the goods at the port. NPA will lose revenue and it would reduce efficiency and turn around of ships at Nigerian ports”
On his part, the Director General of Lagos Chamber of Commerce and Industry (LCCI), Dr. Muda Yusuf, said the industries would resist the charges because it is not the best of time for businesses generally.
Similarly, Olufemi Immanuel of MAN, said it is a capital no to the surcharge because it is coming at a time when manufacturers are working with less staff, less raw material and lower profit.
He said, “the price of goods will skyrocket and cost of transports will be unbearable”.
The representative of NACCIMA, Mrs. Margaret Orakwusi, lamented that the surcharge would affect commerce critically.
According to her, the fact that Nigeria is endowed with cargoes should give the nation an advantage in the bid to negotiate a complete removal of the newly introduced charges.
“Our members borrowed huge money to import items and they are slammed this huge amount. You can only imagine the effect this would have on the economy, then it would affect the banks too,” she said.
Large scale importers such as Dangote Group and Promasidor also bemoaned the arbitrary charges by shipping companies, expressing readiness to protest the charges with all mercineries.
The six companies involved are Cosco, Maersk, MSC, CMA CGM, Hapag Lloyd and Evergreen shipping.
Speaking on behalf of freight forwarders, the Vice President, Association of Nigerian Licensed Customs Agents (ANLCA), Dr. Kayode Farinto, called for a collaboration with ECOWAS on the arbitrary charges.
Similarly, the President, National Association of Government Approved Freight Forwarders (NAGAFF), Chief Increase Uche, said the peak season surcharge was unaceptable, adding that the new normal does not give room for such charges.
In another development, NSC began clamping down on erring terminal operators and shipping companies involved in practices which increase the cost of using Nigerian ports.
Speaking with MMS Plus on the development, Deputy Director, Monitoring and Compliance division, NSC, Mrs. Celine Ifeora noted that the decision was taken by the Council management as the companies have been abusing NSC’s lenient approach.