In a statement issued yesterday, MAN’s Director General, Segun Ajayi-Kadir, voiced his apprehension regarding the potential adverse effects of the hike. He pointed out that this increase would lead to elevated production costs, heightened inflationary pressures, and diminished competitiveness for domestically produced goods.
Ajayi-Kadir stated:
“At a time when businesses are struggling with the rising cost of operations, high foreign exchange rates, astronomical energy costs, and general economic uncertainties, imposing additional financial burdens on manufacturers through increased port tariffs will exacerbate the challenges faced by the real sector.”
He emphasized the importance of ports as gateways for international trade, which play a crucial role in business efficiency and cost-effectiveness.
“For manufacturers, port-related charges constitute significant indirect costs, as most raw materials and industrial machinery are imported through these ports. Any increase in charges will have a ripple effect, leading to higher production costs, increased inflationary pressures, and reduced competitiveness of locally manufactured goods,” he added.
Ajayi-Kadir said that manufacturers renting space in NPA facilities will also see higher costs, maybe messing up the sector's slow recovery from past problems.
He pointed out some big problems hurting port income: port jams and slowdowns, huge demurrage fees, not enough infrastructure spending, and needing better pricing.
He concluded by saying, “While we acknowledge the need for revenue generation, increasing port tariffs could be counterproductive in the long run,”