With 115m Tons Annual Import Deficit in Air Cargo, Nigeria May Lose Benefits of AfCFTA

Chinedu Eze

Nigeria may not benefit from the African Continental Free Trade Area (AfCFTA), which favours countries that export high volume of products and services, as records indicate that the country exports only about 13 per cent of its cargo imports, which amounts to 115 million tons annual import deficit.
According to 2019 records of the Federal Airports Authority of Nigeria (FAAN), Nigeria’s annual air cargo import stands at about 131 million tons, while it exports only 16 million tons by air.

Aviation expert and specialist in cargo freighting Mr. Amos Akpan, warned that Nigeria is losing income it could have earned from export by air cargo because it did not build capacity for export.
He regretted that most cargo flights that bring goods to Nigeria fly back empty because there are not products to take out of the country.

Akpan who is the Managing Director of Flight Logistics Solutions Limited said, “Official data records 131 million tons of air cargo arrived Nigeria as imports, while 16 million tons of air cargo left as exports (FAAN data for Lagos, Abuja, Kano, Port Harcourt). This leaves a gap of 115 million tons between air cargo imports and exports.
“This implies that most aircraft that bring in air cargo into Nigeria return empty. The revenue Nigeria could have earned is lost in this imbalance. Furthermore, there is unrecorded trade going on by unregistered agents within the air cargo terminals. Cargo moved from Lagos to West and central African cities are not captured in the trade records.”

“Food items are exported through scheduled flights daily to Nigerians living in Europe and America but not captured. We need to address hindrances to export and properly situate air cargo export in our trade records so we can build a system that will participate in regional, continental, and global trade arrangements like African Continental Free Trade Area (ACFTA),” he said.

Akpan said air cargo remained critical for every country’s economic development because it is the fastest way to move urgent goods and it is a denominator of countries that enjoy robust economy.
“The World Trade Systems capture air cargo as integral part of the entire logistics chain. As at 2020, air cargo accounted for 35 per cent of the movement of goods worldwide. Air cargo is critical to world economy; International Air Transport Association (IATA) records six trillion dollars as airlines contribution out of which air cargo generated $111 billion. The resolution from the 73rd AGM of IATA is to equip air cargo to benefit from the anticipated $1 trillion increase in trade growth in the next five years. All sectors of our socio-economic life depend a lot on air cargo. In medicine, air cargo is relied upon to deliver vaccines and body organs on-time to save lives,” Akpan said.

He said that over the years there has not been any revamp in the process in cargo handling at the airports and remarked that for Nigeria to overcome the existing trade imbalance, it must do everything possible to export more goods, especially perishables that are in high demand in Europe and the Americas.
“We need to manage air cargo shipments in an accelerated and competent manner so that we key into the global economic development and aviation profitability in the post covid-19 era. It is more convenient now to discuss transactions via electronic communications but end with order for goods to be shipped by air.
“Software solutions in passenger processing is far more developed and applied than it is done in cargo processes. Indeed a lot of paper work is still in use in cargo processing. This is not in conformity with the aviation greenhouse program. DHL and FEDEX are ahead in the application of software solutions to logistics with particular attention to air cargo.

“Our Freight forwarders are not synchronised with freight forwarding associations in major air cargo logistics hubs like: Hong-Kong, Guangzhou, Heathrow/Hounslow, Dubai, Houston and Amsterdam’s Schiphol airport. I recently visited the offices of Association of Nigerian freight forwarders and clearing agents of Nigeria located at the cargo terminal of Murtala Mohammed International Airport. Their documentations were 90 per cent paper work, ”he further said.
Akpan expressed regret that government agencies at the airports, especially on the export desk, were not executing current government pronounced economic programme, noting that as a practitioner, he received order to quote for the movement of pineapples, bananas, mango to a European city. One agency desk at the airport officially requested for N20 per kilogram. After summing up the charges from the government agencies per kilogram, and adding the freight charges, the order was cancelled because of unreasonable cost.

“If you pay N20 per kilo to process shipment of pineapples at one desk, you end up with about 150 naira per kilo as export processing fee; add air freight charges of N1000 per kilo (N1, 150 per kilo). How much is one bulb of pineapple? That will be at most one dollar. Another interesting experience this year is with the department that supervises import of seedlings. A farm management wrote to seek permission to import four thousand seedlings of avocado and macadamia seedlings from another African country.

“This government agency (not customs) replied asking the farm management to pay N10 million before the permit is issued. Note that the phyto sanitary certificate was obtained from the origin country at a fee of $120 only” he added.

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