Apprehension as Multinational Shipping Lines Begin Gradual Take-over of Clearing Jobs from Nigerian Freight Forwarders
LAGOS PORT
*Threaten Importers with end to end logistics services
*Practice started in Kenya
By Francis Ugwoke
The worst business practice appears to be evolving in the nation’s ports industry with multinational shipping lines allegedly making frantic moves to gradually dislodge Nigerian freight forwarders from their professional practice of clearing goods.
Sources told SHIPPING DAY that in the past one year most of the multinational shipping lines operating in Nigeria have incorporated local imports clearance desks handling cargo and logistics activities across the ports.
The idea, it was gathered was to ensure that they handle most of the clearing jobs involving the consignments they bring to Nigeria.
To ensure that they succeed, our source said that Nigerian importers are currently being lobbied to sign up end to end logistics services with them.
With this arrangement, importers will simply accord the clearing right to the shipping lines as soon as the goods arrive Nigerian shores.
The implication is that gradually, Nigerian freight forwarders or customs brokers as they are called may have no jobs or limited jobs to handle as far as clearing services are concerned.
It was further gathered that some of the shipping lines are even threatening the importers to sign up the end to end logistics services for obvious reasons.
A freight forwarder and former President of National Association of Government Approved Freight Forwarders (NAGAFF), Dr Eugene Nweke told SHIPPING DAY that this was what happened in Kenya where shipping lines are currently involved in clearing of goods for owners of cargoes they brought into that country.
Nweke told SHIPPING DAY, “It has become a common practice in our cargo clearance and logistics space for shipping lines to designate local imports clearance outfit ( desk/unit) sending email or Whatsapp messages asking your clients to allow them clear and deliver the consignment to their warehouses at a most considerate cost and speed. Initially, this is a common practice with groupage importation, but has since migrated to the full container load (FCL) importations”.
Nweke added, “The port scenario as at today shows that out of every 20 clearing firms, only 5 are directly having jobs and who sublet to another 5 agents , while the other 10 are without jobs. And they will always believe that jobs are scanty or that importation has reduced. Unfortunately, they never take time to ask, if job is truly too scanty, how come the Customs revenue are soaring higher and ships stemmed to all bonded terminals, without recourse?.
“My concern is sooner or later, as it is happening in Kenya, merger and acquisition will be a novel in our industry and by then the number of job losses would be unbelievable. In Kenya neither the port economic regulator, nor the Shippers Council or the consumers regulatory agencies were able to stop the development, due to the shipping lines stakes in merger and re-acquisitions.
“I believe it is no longer story that between the practitioners and the designated imports clearance units that there is no form of level playing fields, they enjoy immediate cargo lifting from the ports for a later financial reconciliations and are also accorded reasonable preference even among most of the Customs operational area commands on ground of corporate status.
“However, the bigger concern is the freight forwarders’ participation and break-even in the ongoing AfCTA implementation regime, especially so in the face of possible merger and acquisition”.
Nweke said the biggest problem now was that customs brokers or freight forwarders were currently divided and therefore would be ill-equipped to fight against this scenario.
He added that what is even worrisome is the fact that the shipping lines may resort creating or sponsoring more crisis among the customs agents associations to remain divided on common issues and therefore unable to come fight them.
He added, “The ugly situation being that the freight forwarding associations are still divided along nomenclature ground while the oldest association, ANLCA is still neck dip in leadership crisis”.
Nweke said time has come for all freight forwarders to do everything to unite to be able to fight a common course.
“The need to make haste while the sun shines cannot be over emphasized”, he said.
In the case of Kenya, it was gathered that clearing firms were currently suffering risk of closure as shipping lines ares now involved in clearing for importers in that country.
It was estimated that no fewer than 1,000 local firms face closure in Kenya as a result of the subtle incursion from the multinational shipping lines.
It was reported that the 1000 local firms closure translates to more than 10,000 jobs that are on the line, according to the Kenya International Freight and Warehousing Association ( KIFWA).
*Practice started in Kenya
By Francis Ugwoke
The worst business practice appears to be evolving in the nation’s ports industry with multinational shipping lines allegedly making frantic moves to gradually dislodge Nigerian freight forwarders from their professional practice of clearing goods.
Sources told SHIPPING DAY that in the past one year most of the multinational shipping lines operating in Nigeria have incorporated local imports clearance desks handling cargo and logistics activities across the ports.
The idea, it was gathered was to ensure that they handle most of the clearing jobs involving the consignments they bring to Nigeria.
To ensure that they succeed, our source said that Nigerian importers are currently being lobbied to sign up end to end logistics services with them.
With this arrangement, importers will simply accord the clearing right to the shipping lines as soon as the goods arrive Nigerian shores.
The implication is that gradually, Nigerian freight forwarders or customs brokers as they are called may have no jobs or limited jobs to handle as far as clearing services are concerned.
It was further gathered that some of the shipping lines are even threatening the importers to sign up the end to end logistics services for obvious reasons.
A freight forwarder and former President of National Association of Government Approved Freight Forwarders (NAGAFF), Dr Eugene Nweke told SHIPPING DAY that this was what happened in Kenya where shipping lines are currently involved in clearing of goods for owners of cargoes they brought into that country.
Nweke told SHIPPING DAY, “It has become a common practice in our cargo clearance and logistics space for shipping lines to designate local imports clearance outfit ( desk/unit) sending email or Whatsapp messages asking your clients to allow them clear and deliver the consignment to their warehouses at a most considerate cost and speed. Initially, this is a common practice with groupage importation, but has since migrated to the full container load (FCL) importations”.
Nweke added, “The port scenario as at today shows that out of every 20 clearing firms, only 5 are directly having jobs and who sublet to another 5 agents , while the other 10 are without jobs. And they will always believe that jobs are scanty or that importation has reduced. Unfortunately, they never take time to ask, if job is truly too scanty, how come the Customs revenue are soaring higher and ships stemmed to all bonded terminals, without recourse?.
“My concern is sooner or later, as it is happening in Kenya, merger and acquisition will be a novel in our industry and by then the number of job losses would be unbelievable. In Kenya neither the port economic regulator, nor the Shippers Council or the consumers regulatory agencies were able to stop the development, due to the shipping lines stakes in merger and re-acquisitions.
“I believe it is no longer story that between the practitioners and the designated imports clearance units that there is no form of level playing fields, they enjoy immediate cargo lifting from the ports for a later financial reconciliations and are also accorded reasonable preference even among most of the Customs operational area commands on ground of corporate status.
“However, the bigger concern is the freight forwarders’ participation and break-even in the ongoing AfCTA implementation regime, especially so in the face of possible merger and acquisition”.
Nweke said the biggest problem now was that customs brokers or freight forwarders were currently divided and therefore would be ill-equipped to fight against this scenario.
He added that what is even worrisome is the fact that the shipping lines may resort creating or sponsoring more crisis among the customs agents associations to remain divided on common issues and therefore unable to come fight them.
He added, “The ugly situation being that the freight forwarding associations are still divided along nomenclature ground while the oldest association, ANLCA is still neck dip in leadership crisis”.
Nweke said time has come for all freight forwarders to do everything to unite to be able to fight a common course.
“The need to make haste while the sun shines cannot be over emphasized”, he said.
In the case of Kenya, it was gathered that clearing firms were currently suffering risk of closure as shipping lines ares now involved in clearing for importers in that country.
It was estimated that no fewer than 1,000 local firms face closure in Kenya as a result of the subtle incursion from the multinational shipping lines.
It was reported that the 1000 local firms closure translates to more than 10,000 jobs that are on the line, according to the Kenya International Freight and Warehousing Association ( KIFWA).
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