Overcoming Impediments to Cargo Export
Chinedu Eze
The 4th Chinet Conference on aviacargo held last week in Lagos, brought so much to the fore about the prospect of Nigeria earning hugely from export of perishables and other farm produce and the potential for the sub-sector to create thousands of jobs if maximized.
Nigeria is known as a country that sits on wealth that is not realised because the right actions have not been taken and the right policies have not been implemented and many Nigerians regrettably attribute it to bad governance.
For example, Nigeria can become the highest exporter of palm oil and its associated derivatives; it can be the highest exporter of cashew nuts, gum Arabic, cassava, yams, cocoa and many other things because it has large enviable arable land, huge population but unfortunately the country lacks government’s drive to put things in better perspective.
In the presentation of the Comptroller General, Nigeria Agricultural Quarantine Service (NAQS), Dr. Vincent Isegbe, titled: ‘NAQS Solving the Traceable Problem in Agro Export’, he noted that Nigeria has 34 million hectares of arable land with no earthquakes, no landslides, and no winter. Even the Sahel is good for rice and wheat farming, and it has large number of water bodies for irrigation, and it is equi-distantly located to international markets and has 213 million in population (2013 estimate) with 53.98 per cent of which are 15-65 years old.
Yet, the country cannot feed itself or produce cash crops for export that can turn the tide in lopsided foreign exchange of international currencies that never favoured Nigeria.
He explained that for Nigerian farm produce to be fully embraced by the consumer nations’ markets, they must meet acceptance standards and one of these major standards is traceability, which will authenticate the produce and provide it sure provenance incase consumers want to know where the produce comes from. It also helps to single out a produce that has issues, like being infected and makes it unhealthy for human consumption.
So, traceability helps in tracking the pathway of the entire food system, farm to table of produce, process and facility, conduit of excellence (CoE), government zero reject committee and export certification value chain. Traceability also enhances food safety, prevents food fraud, and it promotes preservation of environmental biodiversity and regulatory compliance.
Traceability, however, faces some challenges, which include data management, resource constraints, socio-cultural limitations, lack of awareness, poor collaboration network between stakeholders and irregular audit of the process.
Quarantine has so far created traceability for the following produce: hibiscus, which is a huge forex earner for the country, cowpea, fresh green vegetables, live ornamental fish, which are used for home aquariums and others and snails.
The domestic cargo market is estimated to hover around N20-40 billion annually, which is small considering the geographical size of Nigeria, but with the right infrastructure and policies, the domestic cargo market has the potential to grow into a multi-billion dollar market, contributing significantly to Nigeria’s GDP.
This is why many industry stakeholders commend Chinet conference because of the new ideas it is throwing up for consideration by government to improve and also bring new innovation in the export process.
In his address, the Minister of Aviation and Aerospace development, Mr. Festus keyamo said, recognising the immense opportunities within the cargo sector, the Ministry has taken proactive steps with the establishment of a dedicated Cargo Directorate within the Federal Airports Authority of Nigeria (FAAN) as part of its ambitious plan to position Nigeria as a leading player in the global cargo market.
“This directorate is tasked with implementing far-reaching policies and programs that will catalyze the growth of our air cargo industry. These initiatives are designed to streamline operations, enhance infrastructure, and foster partnerships that will make our airports and logistics hubs the preferred gateways for cargo in the region,” the minister said.
The minister, represented by his special Assistant, Mrs. Janet Oputa, emphasised the significant economic benefits of a vibrant cargo sector, including increased trade, job creation, and foreign exchange earnings.
He noted that by facilitating the efficient movement of goods, Nigeria can gain access to new markets for its products, particularly agricultural exports.
To achieve its goals, the ministry called for the active collaboration of industry leaders, regulatory bodies, financial institutions, and international partners.
With their support, Nigeria aims to transform its cargo industry into a multi-billion-dollar sector that will contribute significantly to the nation’s economy.
Speaking on the theme: ‘Opportunities and Challenges of Managing Air Cargo in Nigeria’, a cargo expert, Mr. Ayo Efe-Lewis said, one of the major challenges facing the domestic air cargo industry was the lack of infrastructure and equipment.
He stressed the urgent need to develop domestic cargo facilities in various airports across the country.
According to him, Nigeria has 32 airports, but only a few have designated cargo facilities, and most of these facilities are not equipped to handle cargo efficiently.
“The domestic cargo handles about 5000 tons/month, which is about 8 per cent of the total volumes of air freight processed from Nigeria airports.
“About 1.8 million tons of cargo is moved around Nigeria monthly and 1.79 million is moved by road, rail and our water ways. Only about 4000-5000 tons of cargo is moved by air locally. Air Cargo traditionally represents about 1% of global trade but 35 per cent in value,” he said.
Another challenge is the high operating cost and fees of aircraft, which Mr. Efe-Lewis says, makes it difficult for cargo freighters to operate in the domestic market.
The cargo expert stated that, the lack of space on passengers’ aircraft for domestic cargo also creates uncertainty for perishable goods brought to the airport for freight.
“The domestic cargo handles about 5000 tons/month, which is about 8% of the total volumes of air freight processed from Nigeria airports. The e-commerce industry in Nigeria is estimated at $8 billion and expected to grow at the rate of 5% annually for the next 5 years,” he added.
Despite these challenges, he said there were opportunities for growth in the domestic air cargo industry, as there is increase in the movement of goods locally; as some governors in the northern part of the country are considering subsidising air freighting of farm produce to markets like in Lagos, Port Harcourt and other major cities.
Another major challenge air freighting faces in Nigeria includes the obstacles constituted by security operatives at the airports. These include the Nigeria Customs Service, the Nigeria Immigration Service and the Nigeria Agricultural Quarantine Service.
During the conference, the Chairman, Boff & Company Insurance Brokers Limited, Chief Babajide Olatunde-Agbeja, pointed out that there are lots of government bureaucracy in the export process at the airports, which constitute disincentive to export of farm produce. His observation is considered germane against the background of the series of complaints from the officials of the Federal Airports Authority of Nigeria (FAAN) working at the cargo terminals and also officials of aviation handling companies who disclosed that perishables wither and become damaged while in the process of moving them to the aircraft for export.
“The aforementioned usually give unnecessary stringent conditions before the produce will be moved, which is subtle extortion that means that you have to settle if you wish to move your goods. This, to me, is a major obstacle and makes nonsense of other efforts if government does not resolve this matter. There should be a one point examination centre and the examiners should not be more than Quarantine and Customs. National Drug Law Enforcement Agency (NDLEA), Immigration have nothing to do with farm produce billed for export,” a FAAN official lamented to THISDAY.
