Manufacturers lament loss of N800bn export cargo trapped at land border

Abiola Seun

The Organised Private Sector (OPS) has said that export products worth N800 billion are trapped at Nigerian borders with neighbouring countries.

The manufacturing companies namely, Cadbury Nigeria PLC, Dangote Group, Unilever, Nigerian Bottling Company PLC and PZ Industries PLC however said the development has affected the profitability of their firms.

Recall that President Muhammadu Buhari had in August last year, announced the closure of the country’s land borders, especially those in Seme and Idi-Iroko that link Nigeria with the Republic of Benin as part of measures to check the influx of fake and substandard goods as well as light weapons into the country, thus leaving the already packaged export products trapped at the borders.

It was also noted, that those consignments are still trapped at the borders, a development that has tied down both capital and expected profits from the export goods for nearly 10 months.

Manufacturers said that efforts to get them to the market have approved abortive.

They also lamented that the outbreak of COVID-19 and the resultant lockdown of the economy as part of efforts to stem the spread of the virus has further worsened the plight of the manufacturing firms.

The manufacturers disclosed that prior to the lockdown occasioned by the Covid-19 pandemic, they have been operating under severely harsh economic conditions occasioned by poor infrastructure, high cost of funds and dwindling sales due to decline in consumers’ purchasing power, among others.

It was as part of measures to cushion the effects of the harsh operating environment that many of these indigenous firms began to explore other markets within the West African sub-region including the Republic of Benin, Togo and Ghana under the Economic Community of West African States ECOWAS Trade Liberalisation Scheme (ETLS) to boost their turnover and ultimately profit.

The group however pleaded with the federal government to as a matter of urgency consider opening up the borders to enable them move out the affected goods as part of incentives and palliatives that will cushion the effects of the lockdown.

Their appeal was triggered by the government palliatives for the Small and Medium Scale Enterprises SMEs through the Central Bank of Nigeria CBN to enable them stay afloat.

While speaking on the effects of the lockdown on their businesses, a member of the OPS who craved for anonymity, noted that though the government granted a waiver for movement of essential goods like food, water and other medicaments during the lockdown, he accused some security men of overzealousness whom he said always detain trucks bearing such essential items on transit to other parts of the country, which leads to delays and unquantifiable losses.

“Ordinarily, no manufacturing firm would have loved to be transporting goods by road to other parts of the country, especially in the absence of functional rail transport system but for the very harsh operating environment.

“Under normal circumstances, one would have loved to establish small manufacturing units across strategic locations in the country to service certain regions. But you cannot contemplate that. First you will think about power; the electricity to power the factory and other incidental costs that would make such idea impossible.

Using generators is killing because of the high cost of Automotive Gas Oil (AGO) also called diesel.

“Come to think of it, we should have set up manufacturing plants in some of these West African countries, at least one to service that region and all these challenges with land borders, airports and seaports and the attendant logistic cost would have been a thing of the past”, he lamented.