Government should reduce the cost of cargo clearance —Oladunjoye

Karadola

Mr. Ganiyu A. Oladunjoye, is a thoroughbred freight forwarder and managing director, Karadola Nigeria Limited. With more than three decades experience in the Nigerian maritime industry, Oladunjoye is vast with the nitty-gritty of the industry which has witnessed a lot of transformation in the past few years. Within this period, he has equally nurtured Karadola Nigeria Limited into a reputable freight forwarding company which is noted for efficient and effective services at the ports. In this interview with The Economy’s Pita Ochai,  he bares his mind on some controversial issues in the maritime industry such as the new automobile policy,  the practicability of 48 hours cargo clearance and the effects of concessioning on the cost of doing business at the ports. Excerpts:

Tell us about your company and your experience as a freight forwarder in the maritime sector? 

My company, Karadola Nigeria Limited, is one of the fast-growing freight forwarding companies in Nigeria. I have been in this business for 30 years and we have done business with major companies in the country. The core values of our company are trust, transparency and integrity. Over the years, we have built a good reputation for the company because we have a team of dedicated staff whose commitment to professional excellence is total. Therefore, effective and efficient service delivery have remained our watchwords and our customers have always testified to this. By the grace of God, Karadola has given birth to another company which will be unfolded in few months time.

As regards our experience in the maritime sector, we have an industry where the clearing and forwarding agents and the importers still bear the burden of delays on cargo clearance at the ports whether it is from the Nigerian Customs Service (NSC) or the terminal operator at the ports. That is bad because I believe that we ought to have gone beyond that level in the maritime industry. We have a situation where you have to pay demurrage for goods even when the delay is as a result of system failure caused by the Customs Service. Sometimes, a terminal operator gives us unreasonable charges. We have bad roads which make transporting the goods out of the ports very difficult. You spend between two to three hours on the average to get your goods out of the ports. Also, trailers conveying our containers often fall along the roads due to bad roads. So we have been facing a lot of challenges. The cost of clearing goods at the ports is on the increase. Due to the increment, I have jobs in the ports which I have not been able to complete in the last three months because the duties have been increased astronomically.

Are the increases as a result of federal government policies or the terminal operators?

I don’t really know. The Customs Service said it is government policy that duties on imported goods should be increased. Some goods that we have been paying N5 million duties now take above N7 million. The increase has impacted negatively on the price of goods in the Nigerian market. A bundle of zinc that used to sell for N5, 000 has gone up to N15, 000. Some of these increases are as a result of the huge duties we have to pay to clear the goods at the ports.

The government agencies at ports have always promised to achieve 48 hours cargo clearance.  Is it happening now at the ports?

Well, we are gradually getting to that.

The federal government recently introduced the new automobile policy, where duty on imported fairly used vehicles popularly known as tokunbo has been increased from 35 percent to 70 percent. Do you think this policy is capable of reviving the automobile industry in the country?

There are issues in that policy we want the government to address. The plan is that they don’t want fairly used cars imported into the country because they want to encourage local production of made-in-Nigeria cars that will not be more than N1 million. We are waiting to see how they will go about that.

Is it achievable considering the fact that a similar policy on rice importation led to diversion of their cargo to neighbouring ports where they are smuggled into the country?

It depends on the government. They can make it work if they are willing to.

Apart from rice, there seems to be increase in the diversion of cargoes to neighbouring countries, particularly Benin Republic and Togo. What is the attraction to these neighbouring ports?

If importers cannot afford to pay what the Nigerian government is demanding from them, the tendency is for them to divert such cargoes to a neighbouring country where their duties are affordable. By so doing, the federal government will be losing a lot of revenue. In recent times, Nigeria has been losing a lot of revenue due to frequent increase in duties while the neighbouring countries are gaining. This has a lot of implications for the Nigerian economy. The policy makers on maritime issues should know that our borders are very porous. When you travel to Cotonou you will see that they are developing at our expense. The city is enjoying stable power supply which we don’t have in Nigeria.

Is it because of the same porous border that we have foreign rice all over the country when the federal government claims that Nigeria has achieved self-sufficiency in local production of rice?

We are still importing rice apart from the ones smuggled into the country. Importers that can afford the high import duty still import while those that cannot pay for the duty move their ship load to neighbouring countries from where they find their way into the country through smuggling.  Some reputable companies that can afford the high duty still import rice and repackage in the country.

You have been operating at the Lagos ports for about 30 years and you were there before the ports were concessioned. What has been the difference between the government-operated ports and the concessioned ports?

The era of port concessioning has brought about increase in charges at the ports. Although, there have been improvement in some facilities, we now pay more for clearing goods. We now pay about N30 million for the same goods we were clearing for N10 million when the facilities were under the watch of the Nigerian Ports Authority (NPA). Most of the time the increases are arbitrary, you don’t get notified that there will be increase in the charges until you enter the ports to clear your goods and you are told that it is no longer what you knew just few days ago. The only company that is somehow considerate is AP Moller because they have improved their facilities at the ports, the service you get is commensurate with the charges you are asked to pay. In other companies, you need to go to the ports and search for your container which could take up to three hours, but now with AP Moller, you don’t need to search, they have an easy way to help you locate your container. You just go for your examination and before the next day the company will bring it to the open for you. Others don’t even have equipment on ground and they charge higher than AP Moller.

Some youths may want to take clearing and forwarding as a career. As a thoroughbred freight forwarder, what is your advice to them?

My only advice for anyone who wants to pick clearing and forwarding as a career is that he must have the capital, if you don’t have the capital you cannot do the job. You have some clients who will just instruct you on what to do and want you to conclude the deal before payment; you know you have to pay charges sometimes worth millions. You also need to train under a freight forwarder who must have had the requisite experience on the job.

There are many associations of freight forwarders in Nigeria such as NAGAFF, AREFF, ANLCA, etc. Why can’t they come under one umbrella body? 

I don’t belong to any of those associations because all the leaders of these associations are interested in their personal gain. You don’t see any of them coming to your aid if you have challenges in doing your job. What they do is to make a lot of noise so that the government can recognise them, give them office in Abuja, and money for their pockets too. They don’t have impact on our job; I have never seen their impact on my own job. This is my 30th year in this job and I am yet to feel their impact. They have always come to me for dues but I always tell them that I won’t pay any dues because they don’t come to my aid in time of difficulties.

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