NSC/NPERA proposes National Port Competitiveness Index, cargo distribution strategy

…Says Forced Cargo Quotas Unnecessary, Unsustainable

BY EGUONO  ODJEGBA

Nigeria’s quest to correct the imbalance in cargo distribution between Lagos and the Eastern ports should not be pursued through politically imposed cargo quotas, but through a competitive regulatory environment that allows every viable port to win cargo on the basis of cost, efficiency, connectivity and service quality.

This was the central argument of a position paper presented at the Annual General Meeting and Conference of the League of Maritime Editors in Lagos, themed “Lagos/Eastern Ports: How to Reverse Existing Imbalance in Disproportionate Cargo Vessel Calls.”

The paper, titled “The Role of the Nigerian Port Economic Regulatory Agency (NPERA) — Defunct Nigerian Shippers’ Council — in Ensuring Equitable Cargo Distribution Across Nigerian Ports,” argued that cargo distribution must follow commercial logic rather than administrative directives.

According to the paper presented by Deputy Director Trade Services, Mrs. Adaora  Nwonu, who represented the Director General of NPERA, Dr. Pius Akutah, said importers and shipping lines consider factors including proximity to markets, port charges, vessel accessibility, terminal efficiency, customs processes, road and rail connectivity, security, cargo-handling capacity and overall logistics costs when choosing ports.

NPERA therefore warned that simply directing shipping lines or importers to distribute a fixed percentage of cargo among Nigerian ports could produce an artificial solution without addressing the underlying competitiveness gap.

Instead, it proposed what it described as “competitive cargo distribution”, whereby no port is deliberately disadvantaged while shipping lines and cargo owners retain genuine choices among viable gateways.

The paper noted that the concentration of cargo in Lagos had become self-reinforcing. A port with more cargo attracts more shipping services, while more shipping services attract additional cargo. Increased cargo volumes then encourage investment in terminals and logistics services, further strengthening the port’s attractiveness.

The reverse, it observed, happens to underutilised ports. Ports with insufficient cargo experience fewer vessel calls, weaker commercial incentives and inadequate ancillary services, thereby becoming progressively less attractive to cargo owners.

The paper consequently called for stronger economic regulation to break the cycle and create a level playing field among Nigerian ports.

It identified cost, efficiency, connectivity, reliability and service quality as the healthier basis for port competition, rather than administrative cargo allocation.

The regulator’s role, according to the paper, should include monitoring terminal handling charges, shipping-line charges, storage and demurrage-related costs, documentation charges, cargo examination costs and inland transportation expenses that influence port choice.

It stressed that the issue was not merely whether a charge existed, but whether the charge was reasonable, transparent, properly disclosed and linked to a service actually provided.

The paper also called for the establishment of a National Port Competitiveness Index, under which the performance of major Nigerian ports would be regularly measured and published.

The proposed scorecard would cover cargo throughput, vessel turnaround, berth productivity, cargo dwell time, truck turnaround, port charges, Customs processing time, cargo evacuation capacity, rail and inland-waterway connectivity and customer satisfaction.

Such a system, it argued, would make competition measurable and allow cargo owners to make informed choices.

It also proposed a National Cargo Distribution Strategy based on port specialisation and comparative advantage. Rather than expecting every port to handle every category of cargo, the strategy would identify the commodities, vessel types, geographical markets and logistics corridors best suited to individual ports.

The paper further called for stronger competition among shipping services, arguing that where a port has adequate infrastructure but lacks regular shipping services, the economic and operational reasons for that situation should be investigated.

Another major recommendation was the integration of ports with railways and inland waterways.

It argued that cargo could not be equitably distributed if evacuation remained heavily dependent on roads, adding that rail-linked and barge-linked corridors should be regarded as integral components of port development.

Digitalisation was also identified as a critical tool for changing the pattern of cargo distribution.

The paper proposed a transparent digital dashboard through which stakeholders could compare ports on measurable indicators such as vessel waiting time, berth productivity, cargo dwell time, Customs clearance time, terminal handling time, truck turnaround, rail evacuation capacity, total logistics cost and delivery reliability.

Such information, it argued, would enable shippers to answer a fundamental question: which Nigerian port can move a particular cargo at the lowest total cost and within the shortest predictable time?

The paper also placed responsibility on other stakeholders.

The Nigerian Ports Authority was expected to provide efficient infrastructure and marine services; the Nigeria Customs Service was urged to strengthen fast, risk-based and predictable cargo clearance; terminal operators were expected to invest in equipment and technology; while state governments were encouraged to provide supporting infrastructure and security.

Shipping lines, importers and freight forwarders were equally urged to make more sophisticated port choices based on total logistics costs rather than traditional preferences.

The maritime media, the paper said, also had a role beyond reporting congestion and regulatory disputes by providing comparative information on port performance.

It challenged journalists to interrogate why certain ports attracted more cargo than others, whether charges were transparent, whether investments were producing promised capacity and whether rail and inland-waterway projects were actually improving cargo evacuation.

The paper concluded that Nigeria’s objective should not be to force cargo away from Lagos towards another port. Rather, government should create a system in which “no port is artificially favoured, no port is unnecessarily disadvantaged, and every viable port has the opportunity to compete for cargo on the basis of efficiency, cost, capacity and service quality.”

That approach, it argued, would produce lower logistics costs, reduced congestion, shorter cargo dwell times, better utilisation of infrastructure, increased private-sector investment and stronger regional economies.

Overall, stakeholders at the workshop were in agreement that Nigeria does not necessarily need to redistribute cargo by decree; but a compelling need to redistribute competitiveness.