Managing Director Skyway Aviation Handling Company Ltd (SAHCO), Mr. Basil Agboarumi gave this run down at the Chinet Aviation & Cargo Conference in his presentation: The Process and Challenges of Warehousing your Goods for Export, where he also indicated that tariffs and charges, double taxation and lack of space for expansion and cargo processing trumps the challenges.
He said that to encourage export in the country, bureaucratic bottlenecks needs to be eliminated and ground handlers need to be encouraged with forex availability and increase of credit facilities stressing that the importance of warehousing in export cannot be overemphasized.
He said,” Warehousing of goods is never an easy task, it requires equipment for specific purposes and for effective warehousing to be in place, Ground Handling companies invest heavily in purchasing of Ground Support Equipment (GSE) ranging from Scanning Machines, ETD, Forklifts, Tow tractors, trained and experienced manpower, space for storage of cargo, effective CCTV with good storage capacity ,dollies, racks, pallets and all these require foreign exchange .
“Some of the challenges of warehousing goods for export include: Shortage of electricity has been a major challenge in warehousing in Ground Handling, for example, the machines must be powered, there are some perishable goods that need to be in certain temperature before they are loaded in the aircraft and the only way to achieve this is through electricity.
“At SAHCO, we need uninterrupted power supply especially to power our freezers and cold rooms, hence we are constantly on generator.”
“High Cost of Forex to acquire facilities for the running of successful export warehouse, tariff/charges: despite the fact that ground handling is an expensive investment, ground handling cost in Nigeria is very cheap, and the payment for services rendered is not commensurate with investment.
He went further to explain other hindrances,” Duplications of duties by Government Agencies: There are too many Government agencies doing the same thing .For example, we have Quarantine, Bomb squad, NDLEA, DSS etc , these agencies can be unified to curb bureaucracies. Double Taxation: For example, plant quarantine and produce quarantine clearance has to be procured with a bill despite the fact that they do the same thing.
He also said limited space for expansion and cargo procession is a challenge.
Agboarumi said that warehousing can be encouraged with the elimination of bureaucratic bottlenecks associated with government inspection agencies often result in delays in the export of goods, if this is curb , it will encourage more exports.
He said,” The Government needs to encourage ground handling companies by making forex available for the purchase of Ground Support Equipment, these equipment are manufactured abroad, Ground Handling Companies have to source for forex through the unofficial market at exorbitant rates just to pay for equipment.
Another way he said is by increasing the availability of credit and provide space for operation and expansion,”The availability of short and long term capital/credit is crucial to exporters and the fact that export awareness has been on the increase and ground handling companies have limited space to expand their warehouse due to the nature of the environment they operate from which is very controlled ,it is cumbersome to have access to land , therefore if the authority could provide more space for warehouse, it will go a long way to encourage exports.