A Review of the Nigerian Energy Industry

LCCI faults FG’s replacement of Cotecna at Apapa ports

Lagos, Apapa port complex15 July 2013, Lagos -The Federal Government has been faulted in its decision to replace Cotecna as service provider at the Lagos port.

The Lagos Chamber of Commerce and Industry, LCCI, said in a statement in Lagos that the Federal Government move has caused a vacuum at the port, which was slowing down cargo clearing.

LCCI said in the statement by its Director-General, Mr. Muda Yesuf: “The decision by Federal Government to replace Cotecna as the service provider responsible for inspection and operation of scanning machines at the Lagos Ports Complex, LPC, Apapa is already taking its toll on the efficiency of cargo clearing process at the port.”

Federal Ministry of Finance recently reshuffled the operations of the destination inspection agents operating in major ports in the country with Cotecna relinquishing control of the Apapa ports to Global Scansystems Limited.

The Central Bank of Nigeria conveyed details of the rearrangement at the ports in a circular to all banks on June 17.

The CBN circular read: “Following the extension of Destination Inspection of Imports at the Nigerian seaports, airports and land borders and the appointment of service providers for a period of six months with effect from June 1, 2013 to November 30, 2013, by the Federal Government of Nigeria, all authorised dealer banks and the general public are hereby notified of the following for compliance.

“Messrs Global Scansystems Limited, Cotecna Destination Inspection Limited and Societe Generole De Surveillance, SGS, have been appointed by the Government as Inspection Agents to carry out the assignment during the period.

“The entry points for imports to Nigeria have been grouped into three lots and allocated to the inspection agents as follows: the Destination Inspection Agents, DIAs, are expected to assume duty at their new allocated lots with effect from Friday, June 14, 2013.

“Apapa Seaports: Cotecna Destination Inspection Limited will transfer operations to Global Scansystems Limited; Grimaldi Port-PTML: Global ScanSystems will transfer operations to Cotecna Destination Inspection Limited.

“Idiroko Land Border: SGS Scanning Nigeria will transfer operations to Global Scansystems Ltd; Calabar Sea Port: Global Scan systems will transfer operations to SGS Scanning Nigeria Limited.

“All other sea, airports and land border operators will remain as they are.”

In its statement on the changes, LCCI furrther said: “LPC is the biggest and busiest port handling a substantial percentage of the imports cargo. The replacement of service provider has created serious capacity gaps in the cargo clearing process.

“Reports reaching LCCI indicate the worsening of congestion at the LPC resulting from delays in the scanning of containers and other related activities.

“This development has profound implications for the private sector and the economy. There will be high demurrage charges arising from delays in clearing of cargo, high cost of fund on borrowed funds by importers.

“There will also be disruption of production schedules of manufacturers as raw materials are stuck at the port, inability of suppliers to meet contractual time-lines, aggravation of corruption and extortion at the port as importers struggle to clear their cargo through the bottlenecks.

“There is also the risk of exacerbation of inflation as goods are not quickly cleared from the port to meet relevant needs in the economy thus undermining the supply side of the economy.”

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