There are fresh fears that the new charges imposed by the Federal Airports Authority of Nigeria (FAAN) will cripple cargo operations in Nigeria’s busiest airport, Murtala Mohammed International Airport, Ikeja, Lagos.
Freight forwarders whose associations were recently slammed with a quit notice by FAAN warned that what they called “arbitrary and unilateral increase in charges by FAAN” were not resolved through dialogue, it could disrupt cargo operations in the airports across the country besides thwarting the Federal Government resolve to increase revenue accruing into the central till.
Leaders of major associations operating at the nation’s airports made their position known at a joint press conference in Lagos recently.
The associations include the National Association of Government Approved Freight Forwarders (NAGAFF), Association of Nigerian Licensed Customs Agents (ANLCA), African Professionals Freight Forwarders and Logistics of Nigeria (APFFLON).
Those who attended the briefing include the Deputy National President of NAGAFF, Air and Logistics, Dr. Segun Musa and the Chairman of ANLCA Airport Chapter, Mr. Tope Akindele.
Going memory lane, Musa who spoke on behalf of others traced the controversy to an agreement reached with FAAN in 2010 over the collection of a seven-naira-per-kilogram levy on cargo, which according to him, was tied to the allocation of land for the development of a cargo village at the airport.
Musa who is known for his in-depth knowledge of the maritime sector of the economy and beyond, explained that prior to the agreement, FAAN had been collecting two naira per kilogram, a charge the freight forwarders had challenged on the grounds that FAAN, having concessioned cargo operations to companies such as NAHCO and SAHCOL, was not directly providing cargo handling services to airport users.
According to him, the associations had formally written to FAAN at the time, arguing that the two-naira charge was illegal, a move that led to prolonged negotiations that reportedly lasted for about two weeks and disrupted activities at the airport. The eventual compromise was the introduction of the seven-naira charge in exchange for the allocation of land to build a cargo village, a deal he said formed the basis of the current arrangement.
Continuing, he said: “The seven naira we are talking about is attached to this land. It is like rent on this land. FAAN has no right to impose fresh charges without first engaging stakeholders. Just as the Nigerian Ports Authority (NPA) relates with terminal operators after concessioning the seaports, FAAN should deal with its concessionaires rather than directly imposing charges on operators.”
The freight forwarders also raised financial concerns, claiming that FAAN had already made substantial sums from the seven-naira levy over the years.
They argued that in 2010 alone, FAAN collected over one billion naira from the charge and that from 2010 to date, the cumulative amount would be far higher than the value of the land allocated for the cargo village.
The immediate trigger for the latest dispute, according to the associations, is FAAN’s decision to increase the existing charges without consultation, a move they said was followed by a threat letter warning of possible demolition of their secretariats. The groups described this as coercive and counterproductive, stressing that they were not opposed to a review of charges but insisted it must be done through dialogue.
They argued that rather than imposing higher fees, FAAN should work with operators to create an enabling environment that would increase cargo throughput, which in turn would raise revenue.
“The more cargo we have, the more revenue they generate,” Musa said, adding that the present approach would only hurt all parties involved.
Also speaking, Akindele said the ongoing standoff had already begun to affect revenue generation just as he noted that cargo activities had slowed in recent days because many operators were staying away from work in protest.
According to him, if a concessionaire that used to make about one billion naira weekly is now making roughly half of that, continued disruption could lead to even worse outcomes for government revenue.
Akindele stressed that the associations were not trying to sabotage government earnings, noting that any revenue yet to be paid due to the slowdown would still be collected once normal operations resume.
“We want government daily revenue to continue. We are not frustrating government revenue. We are ready to continue paying, but let us dialogue within the shortest time so our job can commence,” he said.
He also argued that globally, increments in charges are usually benchmarked around 25 per cent, adding that this was the standard the associations were willing to consider. Beyond that, he said, stakeholders should jointly explore ways to increase cargo volume rather than rely solely on higher levies.
Other stakeholders who speakers at the briefing raised concerns about what they described as multiple layers of charges on the same cargo.
They pointed out that cargo handlers and airlines already collect various fees per kilogram which are ultimately linked to FAAN.
The ANLCA chieftain argued that imposing additional charges on freight forwarders amounts to double or even triple taxation within the same cargo chain.
Others averred that aside from payments to cargo handlers and airlines, some charges could reach as high as 30 naira per kilogram in certain instances, warning that piling more levies on operators would further increase the cost of doing business and weaken the competitiveness of Nigeria’s air cargo sector.
The associations also recalled that the original dispute over the legality of the levy had not been fully resolved in court but was set aside in favour of a mutual understanding aimed at keeping the industry running.
They warned that if FAAN proceeds unilaterally or attempts to formalise the new charges without broad stakeholder agreement, the matter could return to the courts.
The freight forwarders, in a joint appeal, called on the Minister of Aviation, Mr. Festus Keyamo, SAN to intervene and prevail on FAAN to open talks with stakeholders.
They stressed that they were not protesting, not carrying placards, and not seeking confrontation, but were instead asking for engagement that would lead to a mutually beneficial resolution.
They warned that if cargo operations at airports across the country were to grind to a halt, the wider economy would suffer, describing such a scenario as a “lose-lose” situation for operators and government alike.
Notwithstanding the face-off, they confirmed that they had enjoined their members nationwide to continue working and avoid actions that could escalate the situation.
They assured the Federal Government that once negotiations begin, normal operations would resume immediately, with the existing status quo maintained pending the outcome of discussions.
They also reiterated their willingness to work with FAAN and other government agencies to grow cargo volumes and, by extension, government revenue.
