President of Dangote Group, Alhaji Aliko Dangote has joined many other Nigerian shippers to protest the new arbitrary increase in shipping charges by the multinational shipping firms as the Nigerian Shippers’ Council(NSC) rally the support of the Organized Private Sector(OPS) Nigeria and Global Shippers Forum(GSF) to resist the new freight tariff regime.
We gathered that the 2020 peak period charges of between $1000 and $1,500 per twenty-foot equivalent unit(TEU), which has taken effect, is over 400 percent increase from the previous $200 freight charge per TEU during peak period, between September and January. The irony in Nigeria, however, is that after peak period the levy collection continues and rolls over to another season, shippers have observed. .
It was revealed that the reality of the new charges on his business and its effect on the Nigeria’s economy at this difficult times compelled Aliko Dangote to raise alarm on the development, saying it was wrong for the liners to take advantage of Nigerian shippers when the world economy is in a precarious position.
Dangote Group is one of the key Nigerian shippers with high volume of imports and a key stakeholder in Nigerian shipping and port sector.
To address this, the NSC has not only alerted the Federal Government through the Federal Ministry of Transportation on the development and its consequences on the economy but has invited all the multinational shipping firms to a meeting tomorrow, Wednesday, in Lagos with the Nigerian shipping community, Manufacturers Association of Nigeria(MAN), Lagos Chambers of Commerce and Industry(LCCI),among others.
While it is considered discriminatory and astronomical by Nigerian authorities and shippers because of the peculiar arbitrary freight charges introduced all the time over the years by the liners on Nigerian bound cargo not just Africa bound cargo or rate on transatlantic shipping ,China is also protesting a 120 percent increase in freight rate by shipping lines. China’s Ministry of Transport has sent letters to six major container lines, asking them for explanations behind the recent freight rate surges, which has seen ships charging record figures on the transpacific.The six companies questioned are Cosco, Maersk, MSC, CMA CGM, Hapag Lloyd and Evergreen
The liners peculiar charges on Nigeria bound cargo include: Congestion surcharge, which has no fixed rate across liners; Extra risk insurance surcharge,7,500 euro; Freight tax surcharge across liners,3 euro; Bunker adjustment factor, no fixed rate; Currency adjustment factor, no fixed rate; Low sulphur surcharge,2euro; Waiver surcharge,120 euro; Freight rate tax,3 euro; Change of destination service charge, no fixed rate; Nigerian ports surcharges destination,$100; ISPS code charge,16 euro; Peak season surcharge,700 euro, which is never lifted after season; IMO surcharge, no fixed rate.
According to the Executive Secretary/ Chief Executive of Nigerian Shippers’ Council, NSC, Mr. Hassan Bello, who confirmed the new charges and moves by the Council and Nigerian authorities as well as the private sector stakeholders to resist the rate, the increase is astronomical and discriminatory against Nigeria, this is the highest in the world as range of such charges in other economies is between $100 and $200.
The new charges, if allowed to stand, according to the shipping industry operators, will add to cost of imports, and Nigeria’s economy still import-dependent will widen the curve of the rising inflationary pressure which stood at 12.82 percent in the month of July from 12.56 percent the previous month of June,2020.
Bello said in a chat that, “This is not a local charge, it is levied internationally but we are fighting very hard to ensure that they reverse this decision. We have found out that the charges cannot be justified, not even now that Nigeria’s economy is struggling to recover from the impact of the coronavirus (COVID-19) pandemic.
“NSC has already written to Shippers Association of Nigeria, SAN, and also the headquarters of these shipping companies in Europe and everywhere, that it will be economic sabotage at this time to levy such on Nigerian bound cargoes .Apparently, the increase is not levied on some other countries, so it is discriminatory. The levy in some other countries is between $100 and $200 but in Nigeria, they are pushing it to $1,000; it is not justifiable.
“The other problem is that nobody explains what the charges are for. They will use all sought of unjustified means to ensure that they add to the cost of shipping in Nigeria. We are consulting with the private sector. We have already spoken with the Lagos Chamber of Commerce and Industry, LCCI, the Manufacturers Association of Nigeria, MAN,big shippers like Dangote, the breweries and others so that we can come together and start fighting against this arbitrary increase.
“At the international level, we are going to rally the Global Shippers Forum (GSF), we are also going to have a joint statement which we are crafting, along with the Union of African Shippers Council, UASC, that is all the Shippers Councils in Africa.We are also going to contact the Foreign Affairs Ministry as well as the Ministry of Trade and Investment so that we can look at these unfair trade practices of these global shipping companies against Nigeria bound cargoes,” he added
