By Fruzzy Wuzzy
. . .Council has no business in standardising logistics cost – Expert
. . . Shippers Council is Economic Regulator
In a bid to promote fairness and transparency within the nation’s supply chain, the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN) has begun moves to standardize logistics costs and cargo handling charges across the nation’s cargo delivery chain.
Speaking at the recently concluded stakeholders’ meeting on the National Single Window (NSW) project, the Registrar of the Council, Mr. Kingsley Igwe, disclosed that the Council plans to engage the National Assembly to push for legislation that will regulate logistics charges and related costs within the sector.
Igwe further noted that logistics costs have already been standardized in many parts of the world, emphasizing that Nigeria can adopt similar practices to align with global best standards.
Igwe explained that the Council reviewed various invoicing and third-party charges including those from customs, shipping lines, and other logistics service providers and compared them with what is obtainable in other countries.
He said the study showed that in many African countries and beyond, such charges typically account for between 10 and 20 percent of total logistics costs. Based on this, stakeholders in Nigeria agreed that a reasonable range would be between 8 and 12 percent.
According to him, the Council plans to recommend this range to the National Assembly for legislation, so that logistics and freight charges across the country can be standardized. This, he added, will help ensure that invoices from different service providers remain fair and consistent, rather than widely varying from one operator to another.
According to him, “We looked at invoicing charges from all third-party operators which include customs, shipping lines, and others and compared them with what is being practised in other countries. We discovered that in most African nations and beyond, such charges range between 10 and 20 percent of the total logistics cost.
“After consultations with stakeholders, the Council agreed on a more suitable range for Nigeria. “Our findings show that a rate between 8 and 12 percent is reasonable and can be standardized across all service providers’ charges.”
“Once this is implemented, invoicing and charges across different operators will be uniform. Whether you get quotes from five or more service providers, the variation will no longer be wide because it will be standardized.”
Igwe said that reducing logistics costs in Nigeria goes beyond addressing the fees charged by freight forwarders, customs, or other government agencies. According to him, the real issue lies in the tools and systems the government uses to manage trade processes.
“If we truly want to reduce logistics costs, the problem may not be with the service charges of agents or customs. The real challenge is with the tools and systems the state uses,” he explained.
He cited Singapore as an example of how technology and trade agreements can help lower logistics costs. “In Singapore, the customs system is automated. When you log into their trade platform, there’s a dropdown menu showing all their free trade agreements — with the U.S., China, and other countries under ASEAN,” he said.
Igwe noted that these agreements significantly reduce tariffs on imports. “Because of these agreements, tariff rates in Singapore can drop to as low as 5%, 3%, or even zero. That’s where cost reduction in logistics truly begins,” he added
He pointed out that Nigeria still operates mainly under the Common External Tariff (CET), which keeps import duties high despite the country having multiple free trade agreements with partners such as the United States and China.
“Nigeria has several trade agreements that could help lower import costs, but we are not fully applying them. Instead, we rely heavily on the common external tariff, which keeps duties as high as 20 to 40 percent,”
“The goal should be to make the process routine and efficient, not to complicate it with manual interventions. It’s time we reflect on what we’ve achieved and take steps to make the system truly work for Nigeria.”
He opined that the National Single Window project will capture these trade agreements and automate tariff adjustments to reflect them.
Reacting to the development, Dr. Obiora Madu said that the CRFFN has no business in the Standardization of logistics cost and advised that the the Freight Forwarding Council should liaise with the Nigerian Shippers Council if they want to make any meaningful impact in this regard.
Madu also also said that the CRFFN should also ensure that every stakeholder in the logistics supply chains must be carried along.
He explained that the responsibility to standardize logistics cc osst belongs to the Nigerian Shippers’ Council (NSC), which is the economic regulator of the ports.
He said: “The Council for the Regulation of Freight Forwarding in Nigeria (CRFFN) may bear the name “Council for Regulation,” but when you look at the Act establishing it you will see that its role does not extend to regulating or standardizing logistics costs.
“CRFFN as a Council, collects practicing fees from freight forwarders, but when it comes to the fees or charges that freight forwarders and other operators pay, that responsibility belongs to the Nigerian Shippers’ Council (NSC), which is the economic regulator of the ports.
“Unfortunately, in Nigeria, every agency wants to take on every responsibility. That’s why you see agencies like NAFDAC trying to involve themselves in export processes — which only increases costs for struggling exporters.
“So, to be clear, CRFFN has no business regulating or standardizing logistics costs.
When we talk about “logistics costs,” we’re referring to expenses like hauling or trucking containers out of the ports. The idea of standardizing such costs so they’re built into the overall cargo delivery chain sounds good in theory, but practically, how do you implement it?
For instance, some truckers face serious risks just trying to deliver cargo; standardizing costs won’t solve that.
“The real problem is that logistics in Nigeria has no single coordinating authority. No one knows whether logistics should fall under Aviation, Marine and Blue Economy, Transport, or Trade and Investment. It’s a sector with too many “mothers” and no clear leader.
“What should happen is simple:If CRFFN wants to do anything regarding logistics cost regulation, it should work with the Shippers’ Council, since they are the recognized economic regulator. Together, they can consult the National Assembly and propose a coordinated framework.
“In fact, this discussion should also involve other key players like the Nigerian Ports Authority (NPA), Rail, Aviation, and others. They should all sit together, harmonize their views, and make a joint presentation to the Ministry of Marine and Blue Economy or directly to the National Assembly.
“That way, if there’s a public hearing, each agency can respond to issues that concern its area.
“We should also involve the National Bureau of Statistics (NBS) and Nigerian Institute of Transport Technology (NITT) because we still don’t know the true logistics contribution to Nigeria’s GDP.
“From a research we did with NITT, we discovered that informal logistics activities like Okada/ couriers might even be bigger than formal corporate logistics. That means current NBS figures are likely inaccurate, and more work needs to be done to capture the real picture.
“All of this shows why collaboration and synergy among agencies are essential. Sadly, in Nigeria’s public service, cooperation is rare and that’s part of why progress is slow.”
Similarly, former Vice President of the Chartered Institute of Logistics and Transport (CILT), Dr. Aban Igwe, emphasized the need to regulate the cost of freight forwarding. He explained that just as real estate agents earn commissions on properties sold, leased, or rented, there should also be a structured system guiding freight forwarding charges.
Igwe further revealed that the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN) and the leadership of the Nigerian Shippers’ Council have already held discussions on the standardization of logistics costs.
He said:”When we talk about analyzing value, the first question is what value are we actually bringing? Let’s imagine a shipper bringing in one container. One freight forwarder might clear it in 10 minutes, another in 20, and yet another in 30 minutes. That inconsistency shows we have no real idea about our shipping costs.
“Now, someone might say, there should be a fair idea of what you spend on shipping.” And that’s true. In other industries, like real estate, you know that if you’re renting a house, you’ll pay around 10% legal fees and 10% agency fees. Freight forwarding is also an agency business we act on behalf of a shipper, whether for imports or exports. So, there’s nothing wrong with having a fair idea of what to expect for handling one container.
“Freight forwarding actually falls under logistics. It covers the entire chain of how cargo moves from one country to another. The whole process is part of logistics.”Reacting to the development, the President of the Chartered Institute of Transport Administration (CIOTA), Mr. Segun Obayendo, expressed the institute’s full support for the Council’s initiative to standardize the logistics industry.
