Globally, seaports are essential drivers of domestic and international trade – especially the latter. Seaports are critical to the Nigerian economy owing to its dependence on imports and also being the largest exporter of oil and some agricultural produce in Africa. Most of these cargo trades are done by sea. Hence, the maritime sector is integral to the country’s growth and development.
Nigeria has six major seaports controlled by the Nigerian Ports Authority. While some of these ports are the hotspot of intercontinental commerce, others serve as domestic ports. Being a commercial hotspot, the Apapa port in Lagos is infamous for congestion. In the first quarter of 2022, 92.28 per cent of Nigeria’s total exports and 60.77 per cent of imports went through the Apapa port. Other seaports shared a meagre 7.7 per cent and 39.2 per cent of exports and imports respectively during the period.
Consequently, the cost of doing business at the port has become a painful experience for exporters, importers, and other stakeholders. In 2018, companies operating under the Dangote Group had an estimated loss of over N15 billion as profit foregone to the Apapa gridlock. Widespread congestion at Nigerian ports cost the country $55 million (N20.8 billion) per day in 2020, with the Apapa port accounting for a large portion of this cost. A concerned stakeholder once compared what port users encountered at the port to a wartime experience. Attempts to decongest the Apapa Port have always failed.
The dire need for decongestion and attracting larger vessels to Nigeria birthed the increasingly popular $1.5 billion Lekki Deep Seaport, which has broken so many records with its construction and features even before it is operational. In addition to being Nigeria’s first Deep Seaport, Lekki Port will be the first fully automated port at launch. Once operational, it would cut ship waiting times by 50 to 60 per cent.
Earlier this month, the port in the heart of the Lekki Free Trade Zone marked a significant milestone ahead of its operations in September as the first marine vessel “Zhen Hua 28,” a heavy lift carrier, docked on its shore. With this came the delivery of three Super Post Panamax Ships to Shore (STS) Cranes and 10 Rubber Tyred Gantries (RTGs). The project would bring $201 billion in revenues to federal and state governments through taxes, royalties, and duties, as well as an aggregate impact of $361 billion in 45 years upon the commencement of operations.
Is Lekki the new way to go?
There is no denying the projected economic prospect of the Lekki Deep Seaport is fantastic, but it also poses new challenges for the country and Lagos state. Lagos is home to major functional seaports in the country, like the Apapa and Tin Can port, which are ill-famed for their congestion. It would make more sense to situate a new port away from a region that is prone to congestion and disorder.
There have been several calls to deconcentrate seaports in Lagos for the growth of equally viable ones, especially in the Southeast region. Sadly, these calls have always remained unanswered due to the lack of political will from an esoteric ruling class who intentionally sabotage activities at their ports to maintain Lagos’ dominance for personal benefits.
Developing seaports in the Southeast region of Nigeria will decongest Lagos ports and strengthen the host region. If this happens, importers who own warehouses outside Lagos could conserve the cost often incurred from transporting their cargoes to the eastern and northern parts of the country. Given these reasons, it would have been best to divert the Lekki Deep Seaport financing to establish a new seaport in the southeast and upgrade existing ones.
Interestingly, there are moves to build another sea port within the Lagos territory – the Badagry seaport. This proposed seaport is estimated to generate about $2.6 billion and create 5,000 direct and indirect jobs when operational. The Lekki Deep Seaport is estimated to create 170,000 jobs. While these numbers are good in reducing unemployment, it is poor for an already overpopulated city like Lagos, which will receive an influx of people.
The Lekki Deep Seaport is here to stay, and ways to decongest it should be the priority. As a result of a deficit in major infrastructure like railway transport, around 90 per cent of cargo is through Nigerian roads. The Lekki Deep Seaport would likely kickstart operations and cargo transportation with a road network. So without efficient alternative access to the port, the Lekki-Epe expressway is as good as the Oshodi-Apapa expressway. On a regular day, without the operation of the seaport, the Lekki- Epe expressway is always a nightmare for commuters, who exhaust several hours in traffic. What would happen if heavy-duty and articulated trucks ply the route? Chaos.
Hence, a rail system is needed to move cargoes within and outside Lagos through the ports. While there have been talks to link the new port to the Lagos-Calabar rail line to reduce the pressure of truck movement on the road, there is nothing concrete yet. On another end, the fourth mainland bridge, already in the pipeline, has a role to play in decongesting roads in the city, but its completion is long-term. In the meantime, an alternative means of transporting cargoes like barges to ply inland waterways would be helpful. Without an efficient maritime logistics chain, the Lekki Deep Seaport is another Apapa in the making.