A significant decline of 61% has been observed in vehicle imports, with operators attributing this downturn to the ongoing foreign exchange crisis.


The importation of vehicles into Nigeria experienced a significant decline between the first quarters of 2023 and 2024.

According to a report titled “Nigerian Ports Authority: Ports Performance Report January to March 2024,” the number of imported vehicles decreased from 28,024 units in Q1 2023 to 10,991 units in Q1 2024, marking a substantial drop of 60.8 percent.

Furthermore, the report indicates that Nigeria’s ports received a total of 251 ships during the first quarter of 2024.

According to the provided documentation, there was a notable decline of 4.3 percent in the number of vessels visiting the nation’s seaports during the specified time frame. This represents a decrease from the 275 ships that were recorded during the same period in 2023.

“There was a significant decline of 60.8% in vehicle importation, with a drop from 28,024 units in Q1 2023 to merely 10,991 units in 2024.,” the document stated.

The report also indicated a decrease in total cargo volumes during the period analyzed, which suggests a decline in trade activities and may indicate economic challenges or changes in the import-export balance.

It was mentioned that the 4.3 percent decrease in ship visits could be due to various factors such as alterations in global shipping routes, modifications in shipping line strategies, or the influence of economic policies on maritime trade.

Regarding cargo traffic, the total cargo throughput, excluding crude oil, amounted to 21,186,348 metric tonnes in 2024 compared to 18,243,644 metric tonnes handled in the first quarter of 2023, representing a 16.1 percent increase.

“In 2023, the total cargo throughput was comprised of 13,563,173 metric tonnes of inward cargo traffic, accounting for 10.5% of the total, and 7,623,175 metric tonnes of outward cargo traffic, representing 27.7% of the total cargo traffic, as detailed in the document.

The performance indicators for the period highlighted some positive trends, even though there was a decline in ship traffic. The average turn-around time for vessels improved to 4.6 days from 5.1 days in 2023.

This enhancement, as per the data, is partially credited to the impact of the Lekki Deep Seaport, which achieved an average turn-around time of just one day, demonstrating its efficiency. In the first quarter of 2024, the berth occupancy rate averaged 29.8 per cent, a decrease from 34.5 per cent in 2023.

The lower berth occupancy rate signifies reduced congestion at the ports, which could lead to better turn-around times and overall efficiency.

Despite the decrease in the number of vessel calls, there was an increase in gross register tonnage, indicating the berthing of larger vessels, particularly at the Lekki Deep Seaport where the average GRT of vessels is 3,801,191.

“This further underscores the significance of a deep sea to Nigeria's maritime or port development. Hence, it is imperative for all stakeholders to collaborate in order to prevent Lekki Deep Seaport from facing the same challenges as Apapa in terms of cargo evacuation," the report concluded. In response to this situation, Mr. Kayode Farinto, a prominent member of the Association of Nigerian Licensed Customs Agents, highlighted that the fluctuating exchange rate is negatively impacting vehicle importation.

"The fluctuating exchange rate is detrimental to the business. Importing older vehicles now results in higher duty payments due to the increasing exchange rate, and no concrete steps have been taken to address this issue," Farinto stated.

He suggested that unless the government stabilizes the exchange rate for cargo clearance at around N1000/$ and extends the age limit for legitimate vehicles allowed to enter from 12 years to 15 years, there will be no significant improvement.

Farinto also warned that smugglers will continue to exploit unapproved routes for vehicle importation if these challenges are not resolved.

 

 

The Chairman of the Ports & Terminal Multipurpose Chapter of the National Council of Managing Directors of Licensed Customs Agents, Mr. Abayomi Duyile, attributed the decline in imported vehicles to the imposition of levies and duties.

The issue pertains to the newly implemented levy, which has resulted in excessive costs. For instance, if one possesses a vehicle that is 15 or 20 years old, the duty imposed will be calculated as though the vehicle is merely 10 years old. This is the reason for the high expenses. He inquired, "When you import these vehicles, what is your method of selling them?” he asked.