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Terminal operators’ revenue eroded by 58%, says association

Members of the Seaport Terminal
Operators Association of Nigeria (STOAN) said their income had been
significantly eroded as a result of the sliding value of the naira and low
import volume.

Speaking over the weekend, STOAN
Chairman, Princess (Dr.) Vicky Haastrup said that at the current exchange rate
of the naira to the USD, Terminal Handling Charges (THC) had effectively been
eroded by 58% in value.
“Most of our commitments are in dollars
whereas we charge in naira but due to the devaluation of the naira, you’ll see
that what we charge today is effectively 42% per cent of its value in 2006 when
you convert to the USD.
“This is significant for us because we
now need more naira to fulfill our dollar commitments.
“It might be recalled that in 2006, one
USD exchanged for about N130 but today it is more than N220 to the dollar which
implies a significant decline of about 65 per cent in the value of the national
currency since port concession,” she said.
Princess Haastrup said the situation
has been compounded by a drop in cargo volume at the port since the beginning
of the year.
“Vessels calls dropped by half in the
first month of this year, and Volume also dropped significantly by an average
of 27 per cent across the various terminals. Some terminals suffered more drop
in volume than this,” she said.
The STOAN Chairman said that only 29
vessels were declared for the Lagos Pilotage District (LPD) between the last
week of February and the first week of March 2015.
“This number includes tankers,
container vessels, general cargo vessels and all. It is very unusual.
Ordinarily, about 60 vessels would be declared within the same period,” she
The STOAN Chairman also said that some
policies of government on importation are affecting volume of cargo handled at
the port.
She said, “For instance due to the
automotive policy, the number of cars/vans discharged in Lagos dropped from
27,000 units in January 2014 to 8,000 units in January 2015.
“It must be noted though that in the
first half of 2014, the volume of vehicles imported was extremely high in
anticipation of the introduction of the new duty regime on vehicles. Average
number of cars/vans for previous years was in the range of 20,000 units per
month. We are talking of more than 60 per cent drop in volume here.
“For trucks, the volume dropped from
2,700 units in January 2014 to 1,700 units in 2015. The number of trucks
discharged in 2014 was in line with the figures of previous years.
“But in Cotonou port, the total number
of cars/vans discharged in January 2015 was 30,000 units against 20,000 units
discharged in January 2014. This represents a 50 per cent growth. Similar
trends have been registered also for trucks.
“This means Cotonou is gaining from
Nigeria’s loss due to the auto policy as more importers are discharging there
to avoid paying the 70 per cent duty and levy in Nigeria. These vehicles will
eventually find their way into the Nigerian market,” she said.
Haastrup said the same fate has
befallen general cargo terminal operators especially those handling rice and
“Terminal operators generally are
facing a tough time here. This certainly is not the best of time for our operations.
“Notwithstanding these challenges
though, our members remain committed to deepening reforms at the ports. We have
achieved tremendous success in the ports and at our various terminals with well
over USD1 billion invested collectively by terminal operators and this has
resulted in a more efficient port operation. We will continue with the success
“The congestion
and vessel queue which we successfully eliminated upon takeover in 2006;
upgrading of port facilities and the continuous transformation of our ports in
line with the vision of President Goodluck Jonathan are major milestones in the
history of the seaports,” Haastrup said.

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