Statistics from the NPA on imports of containers mirror the broader trend for GDP growth. Imports peaked in 2014 at 935,000 TEUs (20-foot equivalent units), slowed sharply in both 2015 and 2016, and recovered a little in 2017. Data for H1 2018 show imports at 374,000 TEUs, equivalent to 56% of the full previous year. In addition to the slowdown in the economy, the CBN’s imposition of restrictions on 41 merchandise import items in 2015 would have contributed to the decline in container traffic. This is a useful consumption indicator we will continue to track.
- It costs almost twice as much to ship a container from New York to Apapa as it does from New York to Cape Town. This depressing statistic does not allow for the cost of moving cargoes inland from Apapa.
- Industry bodies have called for development of the eastern ports to ease the pressure on Apapa and Tin Can Island, which account for close to 80% of total import traffic. Tariff incentives may be required so that the eastern ports can achieve economies of scale.
- Exports of containers, in contrast, are on a broadly upward trend. This may reflect the higher production of export crops such as cashew nuts.
Container traffic through Nigerian ports (‘000 TEUs; laden)
Sources: Nigerian Ports Authority (NPA); FBNQuest Capital Research
- According to one argument, the inefficiencies at Apapa and Tin Can Island ports have denied Nigeria the opportunity to exploit business with the landlocked states to the north. This is wishful thinking. The states in question are members of the Franc Zone, along with Côte d’Ivoire, and share a currency, a language, a legal system and a regulatory framework for transport.
- Further, a large dry port is to be built and financed by China in the northern Ivorian city of Ferkessédougou. Taken in conjunction with the upgrades to the port of Abidjan, it would appear that the Ivorian government has a strategy in place to cement its hold over the transshipment business.