Auto policy hobbles RORO operations

FUNSO OLOJO

The Roll On Roll Off (RORO) operation is under serious threat in Nigeria as the much vilified automotive policy of the Federal government has critically hampered the thriving of the business.

The two RORO facilities in Tin Can Island Lagos which include Five Stars Logistics and Port and Terminal Multi-Services Limited (PTML) account for over 90 per cent of vehicle imports into the country, are the hardest hit as their facilities have become the ghost of their former booming selves.

The RORO facilities witness a boom prior to the commencement of the policy as the higher imports were fuelled by the anxiety of importers who rushed to bring in their goods before they are caught in the auto policy web.

According to the statistics released by the Nigerian Ports Authority(NPA) the Nigerian ports handled 78,754 units of vehicles within the first quarters of 2014 as against the59,608 imported with in the corresponding period in 2013, showing a slight increase of 32 per cent increase.

But the implementation of the policy has completely eroded the gains of the RORO terminal operators.

According to Frank Okocha, the General Manager of Five Stars Logistics declared that the policy has destroyed RORO operation in Nigeria.

According to him, the terminal used to transfer about 1000 units of vehicles daily before the commencement of the policy in 2014 but now the facility now struggles to transfer a paltry number of 100 units.

The highest we have transferred this year were 100 units”, Okocha bemoaned.

Similarly, he declared that the number of RORO vehicles have shrunk following the implementation of the policy.

Okocka claimed that the termi9nal has so far handled 20 RORO vessels this year with some of them carrying 20 units of vehicles.

Between April and June 2015 alone, PTML raised alarm twice about drop in vehicular importation to its terminal.

General Manager of PTML, Mr. TundeKeshinro had said that the policy on vehicle importation is affecting the terminal, adding that there has been a significant drop in the volume of vehicles imported through the terminal.

He said in 2013 and 2014 respectively, the facility experienced massive importation of vehicle but regretted that the situation has changed.

The Managing Director of Port and Terminal Multiservice Limited (PTML), Mr. Asconio Russo also noted that the policy has led to cargo flight, especially motorized cargo to the neighboring countries.

He claimed that the volume of vehicles being imported into Nigeria has dropped sharply due to implementation of the automotive policy, adding that the fairly used vehicles meant for the Nigerian market are now imported through the neighbouring Port of Cotonou, Benin Republic, before they are smuggled back into the country.

“I may not want to comment on government policy because it is not my prerogative but I can give you the figures, tell you that the number of vehicles being discharged all over Nigerian – I am not talking about our terminal – but in Nigeria it has dropped 50 percent.

“So the calculation is if the whole of Lagos was discharging 20,000 or 25,000 vehicles every month it is like we are now doing 10,000 vehicles and these are the ones coming in RORO. There are also some coming in containers which have also disappeared.

“We have noticed that the number of vehicles coming into Cotonou has increased dramatically so we are losing business while Cotonou is gaining business. Everyone can understand what this means and we know that Cotonou’s population has not increased from 10 million people they were.

“This policy is dramatically affecting the port industry and this is affecting the overall population because the prices of vehicles are going up in the market and this is something we see every day,” Russo  agonized.

”PTML is just one of the terminals handling vehicles and for obvious reasons we have experienced decline in the number of vehicles imported and discharged in our facilities and today I will say we have an underutilized space in the terminal

”The space we have now is much more than what number of vehicles the company handles

”Looking at last year and the year before, you will find out that the records show that the terminal is always full of imported vehicles with high number of customers as well who want to obtain services from us.

”So in a way , what we have seen is that we have recorded a significant drop in the volume of vehicles coming to the terminal”, Keshiro corroborated his boss.

Investigations revealed that as the effects of the policy bites harder, the drop in vehicle imports through these facitlites have further dosed dived by about 70 per cent.

For instance, the numbers of vehicle which passed through the two RORO terminals in January 2014 were put as 8000 units, down from 27000 recorded during the corresponding period in 2014.

In February 2015, the figures further went down with only 74000 imports.

However, what the operators of RORO facilities are losing in Nigeria, their counterparts in the neighbouring countries are gaining as there has been a massive diversion of vehicular cargo to the neigbouring ports of Benin Republic.

Nigeria is said to be importing about 800,000 vehicles annually , spending  a fortune in the process.

According to the National Automotive Council of Nigeria, Nigerians spent USD31.67billion (about 6.3trillion) on importation of vehicles and other motorized equipment into the country from 2009 to 2013.

The amount was spent on importation of vehicles, tractors, trailers and semi-trailers, civil engineering and contractors’ plant and equipment. A breakdown of the figure shows that the country spent USD5.407billion in 2008; USD4.012billion in 2009; USD5.592billion in 2010; USD4.082billion in 2011; USD6.364billion in 2012 and USD6.212billion in 2013 on the importation of these items.

A further breakdown shows that a total of about 100,000 new and 300,000 used vehicles were imported into the country in 2012, excluding tractors, trailers and semi-trailers, civil engineering and contractors.

However, the auto policy has virtually wiped off these business opportunities for the RORO terminal operators while their counterparts in the neibouring countries are now smiling to the banks.

However, inventions, they say is the mother of necessity. The beleaguered operators have devised a new method to survive.

Investigations revealed that they have converted their vast expanse of terminal, which have been starved of vehicular cargo, into holding bay for containerized  goods.

They have also cut down the size of their staff strength in a bid to absolve the challenges.

However, the operators have appealed to the Nigerian Shippers Council to intercede for them with the Federal government.

One of the RORO terminal operator, RigoNazzar described the federal government policy on automotive as a flip flop policy, saying that it has adversely killed importation of vehicles into Nigerian ports.

He observed that there is need for the Shippers’ Council to help the operators and relate with the federal government on account of the automotive policy for them to remain in business.

Nazzar also said that there has been significant drop in vehicle importation through the terminal and as investors in Nigeria, there is need for their businesses to be protected.

”We need somebody that can stand in between, from both sides”, he pleaded.

The Documentation Manager of one of the RORO terminal operators, Mr. Nicolas Bruce said that RORO operation in Nigeria is badly affected by the policy, noting that ”the company has staff to pay, will power generators regularly and all these cost money yet we are not operating in a conducive environment due to the policy”

”We are pleading with Shipper’s Council to intervene because it is a matter that needs to be addressed as regulator

He also urged the council’s boss to advice government on the automotive policy because it is killing RORO operations in Nigeria.

Mr. BashiruAdeshina, an official at one of the RORO terminals in Lagos said” as RORO terminal in 2014 we had a great number of vehicles importation but now it has reduced almost to zero”

He said that the federal government policy has not helped to boost RORO operations, calling on the Nigerian Shippers Council to relate with government and find ways to encourage vehicle importation into Nigeria.

He claimed that as at the end of July 2015, importation of vehicles into Nigeria has further dropped by 70 per cent.