The president of the Nigerian Chamber of Shipping, Aminu Umar, has disclosed that Nigerian freight rates have increased by 70% as 50% of foreign vessels have left Nigerian waters in the last 16 months.
"About 40- to 50% of vessels plying Nigerian waters have returned to Europe between 2022 and date. So 40% of the capacity has moved back to Europe," said Umar.
Umar made these comments during a speech about the challenges faced by the Nigerian shipping industry, noting that policies related to the Russia-Ukraine war and resulting insecurities have caused a massive exodus of foreign shippers.
"The truth is that these are foreign-owned vessels trading within the West African sub-region, which includes Nigeria," he said.
Due to the war, there is a stronger market for ships in Europe than in Africa.
"So what it means is that it has created scarcity, which will increase the freight rate.”
Umar said that the freight rate had actually increased by up to 100% before, but had decreased to 70%.
According to Umar, lawmakers in Nigeria have passed a bill to restrict foreign vessels from operating in the country's waters as these insecurities spread.
"There is a stronger market in Europe due to the war, and the trading environment is easier to navigate when you compare it to the trading restrictions in Africa, as well as policies in the West African region.
“Also, don't forget the security issues. We have fewer security issues in Europe than we have in Africa."
