Nigerian Ports revenue, Custom self-imposed N2 trn revenue target

 

By Richards Adeniyi

There are indications that government agencies in Nigeria’s maritime sector are now jittery and strategizing on managing the drop in their yearly revenue due to the outbreak of the Coronavirus in China.

The deadly Coronavirus which has crippled business activities in China and killed thousands of citizens would deal a deadly blow on the Nigerian Customs Service and its self-imposed N2.1trillion 2020 revenue.

Sources at the Lagos Port Command confirmed to National Daily correspondent that the level of imports arriving Nigeria port is gradually dropping as most importations into Nigerian ports are from China.

Already, port calls to China are becoming less frequent, as fear of catching the coronavirus and a slowdown in the Chinese economy have deterred cruise linens, container ships, oil tankers and bulk carriers alike from stopping at the country’s harbours.

Commercial vessels have stopped arriving with port calls falling by an estimated 30 per cent in February and container throughput estimated to decline by between 20 and 30 per cent, according to Clarkson, a shipping research company.

Seven of the world’s 10 largest container ports are in China including Hong Kong. This would also have a negative effect on Nigeria ports system with fewer vessels coming into the port, and port revenues are expected to drop.

Also, vessel owners expect delivery to be delayed. Nine of the 19 Chinese shipyards surveyed by Clarkson put their yards on complete suspension on February 14, with none at full production.

Chinese shipping lines like Cosco and the Financial leasing arms of the country’s biggest banks are collectively the second largest vessel owners on the planet, which underscores their aggressive leasing activity over the past decade to carry the nation’s shore of global commerce.

A highly placed Customs officer at Nigerian Customs confirmed to our correspondent that “the Customs are now sitting down, trying to access how things would go, you cannot just bring up strategies without studying the situation.

“Importers coming from China are being quarantined. Most imports into Nigeria are coming from China, and we are watching, trying to understand the situation.

“It has not affected our revenue so far, this is February, the containers sent last year have not finished arriving, so the effect is not going to be immediate, it is going forward, importation takes time, from the time that importers go shipping then shipment, then before it gets here that is affected, and Wuttan is not even a major trade centre, but global attention is now being given to China.

“We don’t have problems yet because containers coming in right now are those which has been ordered since last year and for past two months, they were dated to arrive January, February.”

Most companies in China are shut down for the moment in order to prevent workers getting exposed to the deadly ‘viruses, the officer said.

Apart from the delivery delay, China’s vessel owners and shipping lines are facing difficult finding new crew, as sailors and officers from mainland China must follow quarantine regulations that apply at every port call, adding, complexities and delays… China is the second biggest source of maritime crew, behind only the Philippines, and ahead of India, Greece and Eastern Europe, according to data by the Hong Kong Ship Owners Association (HKSOA).

The World’s second largest economy, China accounted for 14 per cent of all containerized cargo exports last year, 23 per cent of Seaborne crude oil, 35 per cent of dry bulk shipped, 18 per cent of liquefied gas and 72 per cent of all seaborne iron ore. That has taken a drastic turn, as the coronavirus outbreak gathered pace in February.

Crude oil tankers have stopped sailing for China since the start of the month, compared with 3.42 billion iron-miles every day on average last year, according to Satellite data provided by Vessels Value.

Shipments from the Middle East, China’s largest source of the commodity were 280million deadweight tonne cargo miles on February 5, a mere 12 per cent of the 2.32 billion FWT mile shipped on the same day in 2019, according to shipping analytics Firm Drewry, who note that global freight rates groped 4.1 per cent in the second week in February, declining another 5.8 per cent the second week.

 

 

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