By Joshua Yousouph
Maritime stakeholders have expressed divergent views over the continued relevance of bonded terminals in Lagos, even as operators warn that the over N5 trillion worth of investments are lying largely idle. This is even as critics contend that the facilities have outlived their usefulness and no longer play a significant role in addressing port congestion.
The debate comes amid renewed traffic build-up along the Apapa and Tin Can port corridors and increasing concerns from some stakeholders that bonded terminal operators may soon be forced out of business if current operational trends persist.
While operators who spoke with Shipping Position Daily insist that bonded terminals remain internationally recognised extensions of seaports and essential tools for cargo evacuation, decongestion and trade facilitation, critics believe the facilities require fundamental reforms and stricter oversight to justify their continued existence.
Recall that the National Association of Government Approved Freight Forwarders (NAGAFF) recently announced plans to commence a nationwide inspection and assessment of licensed Customs-bonded warehouses and terminals across Nigeria, following growing concerns over operational inefficiencies, inadequate infrastructure, and poor service delivery within the cargo logistics chain.
Speaking on the state of the sector, the General Secretary of the Association of Bonded Terminal Operators of Nigeria (ABTON), Mr Haruna Omolajomo, raised alarm over what he described as the near-collapse of bonded terminal operations despite investments exceeding ₦5 trillion.
According to him, more than 40 bonded terminals in Lagos alone possess infrastructure capable of handling approximately 84,000 Twenty-foot Equivalent Units (TEUs), but are currently operating at less than five per cent of their installed capacities. “Today, I don’t think there are up to 500 containers spread across these terminals. Most are operating below five per cent capacity, and huge investments are lying idle,” he lamented.
Omolajomo recalled that bonded terminals were established in 2001 after the Federal Government sought private sector support to tackle severe port congestion that had caused significant cargo diversion to neighbouring countries. He explained that operators invested heavily in developing modern facilities after being encouraged by government and the Nigeria Customs Service to transform bonded warehouses into full-fledged bonded terminals.
According to him, the first 10 bonded terminals handled over 484,000 TEUs within their first three years of operation, significantly reducing congestion at the ports and facilitating smoother cargo delivery. “The success recorded by bonded terminals was one of the factors that inspired the government’s port concession programme,” he said.
Omolajomo also attributed the sector’s current struggles to increasing dominance by foreign operators across the logistics value chain, arguing that indigenous investors face severe financing challenges compared to their foreign counterparts. He disclosed that several bonded terminal operators have already shut down their facilities, while others are battling to remain afloat under mounting financial pressure.
Also speaking, another bonded terminal operator, Kenneth Ofurum maintained that bonded terminals remain highly necessary, particularly as congestion gradually returns to Lagos port corridors. “Our roads are getting back to the old days. The roads are clogged and the ports are becoming full again,” he stated.
According to Ofurum, the poor utilisation of bonded terminals is not due to lack of need, but rather operational practices that discourage cargo transfers from the ports. He alleged that some operators benefit significantly from prolonged cargo dwell time and demurrage charges, thereby reducing incentives to move containers to bonded terminals.
“Most of the bonded terminals are not fully-utilised. Yet people are still applying for new licences, which shows that there is still a strong need for them,” he argued.
He called on the Federal Government to introduce stronger regulatory measures that would ensure the effective utilisation of bonded terminals whenever congestion begins to build up at the seaports.
However, a contrasting position was presented by the National Public Relations Officer of the Association of Registered Freight Forwarders of Nigeria (AREFFN), Mr Taiwo Fatomilola, who argued that many bonded terminals have become unnecessary.
Describing the facilities as largely ineffective, Fatomilola alleged that some bonded terminals create opportunities for revenue leakages and inadequate supervision of cargoes. According to him, concerns over duty assessments, cargo transfers and regulatory compliance have raised questions about the value they add to the logistics chain.
He further dismissed claims that the current traffic situation around Lagos ports is linked to the under-utilisation of bonded terminals. “The traffic in the port corridor is not enough excuse for bonded terminals to be patronised. The congestion is largely man-made and caused by operational inefficiencies,” he said.
Fatomilola maintained that stronger enforcement of existing port and truck management procedures would address traffic challenges without necessarily relying on bonded terminals.
