Will Lekki Port complement or compete with Apapa, Tin-Can ports?

 

All is set for the commencement of commercial port operations at the Lekki Deep seaport with the arrival of three Ship To Shore (STS) cranes and 10 Rubber Tyred Gantry (RTG) cranes. While the euphoria over the final completion of the port is yet to settle down, its impact on Nigeria’s busiest ports of Apapa and Tin-Can seems to be putting some operators on their nerves.

Recently, during a stakeholders meeting with the former Minister of State for Transportation, Senator Gbemisola Saraki, the Managing Director of one of the terminal operators at Tin-Can Island port, Ports and Terminal Multiservices Ltd (PTML), Ascanio Russo, warned that because Lekki is coming on stream, other ports shouldn’t be neglected by the Federal Government.

For Russo, the dilapidating state of Nigeria’s busiest ports calls for urgent attention and shouldn’t be overlooked because of a new port that is set to commence. The views of the PTML Managing Director remains germane given the fact that Lekki may confine Apapa and Tin-Can ports to the waste bin of history, as Nigeria’s busiest ports.

For the acting President of the Association of Nigerian Licensed Customs Agents (ANLCA), Dr Kayode Farinto, if Lekki port gets it right as its being widely speculated, then no importer would want to bring his cargoes to Apapa or Tin-Can ports.

According to Dr Farinto, “Some people are saying that Lekki port will complement Apapa and Tin-Can port. For me, those saying that are just being economical with the truth. Let’s ask ourselves, how will Lekki Port complement Apapa and Tin-Can ports?

“The only way Lekki port will complement Apapa and Tin-Can ports is by decongesting those ports. These two ports are congested already, but with Lekki, they will be decongested. So, if some people are telling terminal operators in Apapa and Tin-Can ports that Lekki will complement their operations, yes it will decongest their various port terminals. And you know the terminal operators don’t want their terminals decongested. They make more money with cargoes spending more time in their yards.

“However, in terms of competition, I see Lekki port competing with Apapa and Tin-Can ports for cargoes. By the time Lekki port brings out their own rates for cargo handling, everybody will shift to that side and leave Apapa and Tin-Can. We are all expecting the Lekki Port rate to be lower than what we currently pay at Apapa and Tin-Can ports.

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“The congestion issue in Apapa and Tin-Can has skyrocketed their terminal handling charges. With Lekki that is expected to be automated, there won’t be any issue of congestion inside the terminals, thus their rates will be cheaper compared to Apapa and Tin-Can. And once that happens, it won’t be difficult for us to convince our clients who are the importers on where to take their cargoes to, both import and export units.

“Again, Apapa and Tin-Can are battling with the issue of manual processes as regards Customs operation and some other government agency operations. Cargoes are always subjected to physical examination at Apapa and Tin-Can by Customs, thereby slowing down the cargo clearance chain. If Lekki port gives us a Customs operation that is seamless, why will I then advise my client to take his cargo to Apapa or Tin-Can?

“It is simple logic. At Apapa and Tin-Can, the Customs processes encourage time wastage which means increased charges in shipping. If Lekki provides a Customs process that is seamless as widely touted, then we will direct our clients to take their cargoes straight to Lekki instead of Apapa or Tin-Can. If it is only through taking cargoes to Lekki that the cost of cargo clearance will be reduced, then who cares what happens at Apapa or Tin-Can? Everybody is looking for the cheapest possible means of clearing his cargoes. If Lekki provides that, then I am sorry, I cannot help Apapa or Tin-Can.”

Also speaking on what Lekki portends for Apapa and Tin-Can, a business consultant and clearing agent, Julius Nwachukwu, explained that if Lekki provides a state-of-the-art equipment, then nobody would want to come to Apapa or Tin-Can ports to clear cargoes.

Mr Nwachukwu said, “We learnt that Lekki has already taken delivery of three Ship To Shore (STS) cranes. I am not sure such exists in Apapa or Tin-Can. If Lekki can give port users the required equipment for modern cargo handling services, then why will I tell my client to send his cargo to Apapa or Tin-Can ports?

“With modern equipment, it is obvious that Lekki might start offering the kind of services that Apapa and Tin-Can cannot provide. There is no gainsaying that cargoes will leave Apapa and Tin-Can if Lekki gets it right in terms of availability of modern port equipment and seamless Customs services.

“However, the lack of a rail connection to that port could be its undoing. I fear for all the investment that is coming into that port if cargoes have to rely on road haulage to be evacuated. The first few months will be rosy and people will rush there to clear cargoes. But by the time the rush persists, the port will need another means of evacuating cargoes, and I hope that by then, the rail connection to the port would have been fixed or the roads linking the ports in Lekki would have been expanded.

“Aside cargo evacuation issues which might come later if rail connection is not fixed, Lekki port will definitely wrest cargoes away from Apapa and Tin-Can port because of its level of automation and amount of equipment being invested in the port.

“Currently at Apapa and Tin-Can ports, it takes about eight different signatures to clear one consignment. We are not expecting to see that in Lekki judging by the high level of automation that the port is expected to provide. So much has been said about Lekki Port as the first Nigerian port that will be automated. Even the Nigerian Ports Authority (NPA) has said so at different times. So, why would I leave an automated port and take my cargo to a port where it takes about eight signatures to clear a container?

“To me, Lekki will do more of competing with Apapa and Tin-Can than complementing them.”