Logistics Transport...Logistics & Transport Digest- 4 Council oard ebers CILT, NIGERIA NATIONAL...

www.ciltnigeria.org July 2018 Vol.6 No.9 A Publication Journal of The Chartered Institute of Logistics & Transport-Nigeria.

DigestDigestLogistics TransportLogistics Transport&

LOGISTICS AND TRANSPORT IN THE NIGERIA ECONOMY

BEYOND THE N250bn PORTFOLIO INVESTMENTS IN THE NIGERIAN SPECIAL ECONOMIC ZONES COMPANY LIMITED

AFRICAN CONTINENTAL FREE TRADE AREA (AfCFTA): IMPERATIVES FOR NIGERIA

Logistics & Transport Digest -2

Logistics Outlook

Logistics & Transport Digest-3

The Institute

CIL

T N

IGER

IA ClLT Nigeria was founded in 1958 and

operates under the Royal Charter as an International Branch (IB), (now a Territory). The National Patron of CILT Nigeria is the Honorable Minister of Transport. The Institute is saddled with the functions of Education and Training, certification, setting standards of practice, licensing of professionals, monitoring and regulating professional practice in Nigeria, and is governed by a National Council whose membership is drawn from relevant sectors of the economy. The Institute also has a Board of Trustees, Branches spread across the country and a National Secretariat that manages its day to day affairs.

In order to effectively support the profession and the industry, we have a mutually benefiting relationship with other National Councils, Local and International professional bodies, relevant Statutory bodies and Ministries, including Tertiary Institutions.

MISSION: To develop highly knowledgeable,

experienced and productive professionals for the logistics and transport industry capable of enhancing efficiency in line with global best practice.

VISION: To promote the development of the art

and science of Logistics, Transport and Supply Chain in all its ramifications

WHO WE ARE: CILT is a professional body in the

Logistics, Transport and Supply Chain Management sector that educates, trains, researches, develops processes and systems for the good of the society.

WHAT WE DO: Human capacity development through

long and short educational training programmes, Certification and Licensing, Monitoring and Evaluation, Membership Registration (Individual and Corporate), Research and Development, Advocacy, Organization of Local and International Workshops/Conferences, Local and International Technical Guided Tours, etc.

OBJECTIVES : The objectives of ClLT are to: • Ensure adequate supply of qualified

personnel to the industry.

• Keep qualified individuals up to date throughout their profes sional working lives

• Play active and influential roles in shaping logistics and trans port policies for the future development of the sector

• Promote the study of the art and science of Logistics, Transport and Supply Chain Management.

• Offer quality educational programmes that meet the criteria for professional membership of CILT.

• Encourage members’ active participation in Continuing Professional Development (CPD).

• Collaborate with the educational sector, statutory bodies and professional institutions with the objective of raising standards for certification.

• Foster investigation and research into the development and improvement of Logistics, Transport and Supply Chain by every practical means.

• Initiate regular meetings and exchange of ideas with relevant stakeholders and those interested in transportation sector through conferences, round table, regular meetings, discussion groups, seminars etc.

MEMBERSHIP OF THE INSTITUTE: There are six (6) categories of CILT’s

Membership, namely;• Student Member• Affiliate• Member (MILT)• Chartered Member (CMILT)• Chartered Fellow (FCILT)• Honorary Fellow (FCILT) MEMBERSHIP PROCEDURE: You can obtain CILT membership

application form at our National Secretariat with a fee of N15, 000, or download it from our website http://www.ciltnigeria.org/membership/education/. Upon completion of the form, you should submit with the following:

• A detailed CV prepared in line with the

information at the rear of the application form

• All credentials (photocopies), with original presented for sighting

• Two passport photographs with names and signature at the back

• Any other document that will aid your application

• A teller showing appropriate payments in their specified currencies in favour of Chartered Institute of Logistics and Transport,

using the following Bank details: STERLING BANK PLC ACCOUNT NO. 0010864826

CILT PROFESSIONAL EDUCATION Professional Education is a prerequisite

for developing quality membership and highly skilled manpower for the industry. Accordingly, CILT Nigeria has relationship with higher institutions of learning and specialized organizations which are accredited to undertake the training of candidates for the various levels of examinations.

To this end, the Institute offers five levels of educational programmes as follows;

a. ENTRY QUALIFICATIONS

i. Introductory Certificate in

Logistics and Transport: Open to members with less than five (5) credit level passes in two sittings in GCE, SSCE, WASC etc at O/Level. Matured members and those with long industry experience.

ii. International Certificate in Logistics and Transport: GCE, SSCE, WASC, O/Level with 5 credits in not more than two sittings, holders of National Diploma in non logistics and transport fields. Matured candidates can apply.

iii. International Diploma in Logistics and Transport: Holders of National Diploma in Logistics and Transport, HND, First Degree in any discipline from recognized institutions.

iv. International Advanced Diploma in Logistics and Transport: Holders of International Diploma in Logistics and Transport, HND, BSc. in logistics and transport or related disciplines from recognized Institutions. Masters Degree in other fields can also apply.

b. ACCREDITED TRAINING INSTITUTIONS

Professional Education remains a pre-requisite for developing quality membershwip and highly skilled manpower for the industry. In order to achieve this, CILT Nigeria has relationship with higher Institutions of learning and specialized organizations. These institutions and organizations are accredited to undertake the training of candidates for the various levels of examinations. As at date, we have accredited the following Institutions through which we deliver all levels of our courses.

i. Lagos State University (LASU), Ojo ii. The Polytechnic Ibadan iii. Ladoke Akintola University of

Technology (LAUTECH), Ogbomosho

iv. Olabisi Onabanjo University (OOU), Ago-Iwoye

v. Federal University of Technology, Owerri (FUTO)

vi. Maritime Academy of Nigeria, (MAN) Oron

vii. Multimix Academy, Surulere, Lagos

viii. Nigerian Army College of Logistics (NACOL), Lagos

ix. Nigerian Institute of Transport Technology, (NITT) Zaria

x. Federal University of Technology, Akure (FUTA)

xi. Redeemer’s University (RUN) xii. Centre for Logistics and Transport

Education (CELOTE),Lagos xiii. Ribs Business Studies, Lagos xiv. Centre for Logistics and Transport

Studies, University of Port Harcourt


Council / Board Members

CILT, NIGERIA NATIONAL COUNCIL

1. Amb. Kema Chikwe, FCILT Former Hon. Minister of Transport

2. Mallam Bello Gwandu, FCILT Former MD, NPA

3. Dr. Ade Dosunmu, FCILT Former DG, NIMASA

4. Mrs. Dabney Shall-Holma, FCILT Director, NSC

5. Mrs. Lizzie Ovbude, FCILT MD, PTML

6. Mr. S. Adio Afolabi, FCILT Former AGM, NPA

1

4 5 6

2 3BOARD OF TRUSTEES

Mr. Ibrahim A. Jibril, FCILT, FNIM, ACIPM, CNINational President

The Chartered Institue of Logistics and Transport (CILT)

Alban Igwe Esq, FCILTDeputy National President

Prof. Adesanya Adesoji, FCILTChairman, Ibadan Branch

Mrs. Mohammed Hariratu Maina, FCILTVice President (West)

Mr. Yakubu Musa Dekina, CMILTChairman, Abuja Branch

Mr. Pire Park A. Maidambe, FCILTMaritime Mode Representative

Mr. Joachim Egerue, MILTChairman, Owerri Branch

Chief Peter B. L. Borlo, JP, CMILTChairman, Port Harcourt Branch

Hajia Haisha Ali-Ibrahim, FCILTGlobal Convener/Chairperson, WiLAT

Mr. Francis A. Ehiguese, FCILTInternational Vice President - Nigeria

Mr. James Opaluwa, FCILTChairman, Lagos Branch

Prof. Ezeala Innocent, FCILTChairman, Oron Branch

Prof. Osi Akpoghomeh, FCILTVice President (East)

Mr. Bayero Salih Farah, FCILTChairman, Zaria Branch

Mr. John Dottie, CMILTRail Mode Representative

Mr. Ahmed Mohammed, CMILTPipeline Mode Representative

Mr. Femi Jemirin, FCILTVice President (North)

Mr. Felix E. K. Nakpodia, FCILTChairman, Warri Branch

Hajia Salamatu B. Umar-Eluma, FCILTAir Mode Representative

Mr. Yakubu Abdullahi, CMILTLogistics Mode Representative

Mr. Filibus Billy Edwin, CMILTRoad Mode Representative

Mr. Paul Ndibe, FCILTAg. National Executive Director

Dr. (Mrs.) Arit Mkpandiok, FCILTChairperson,

Professional Development Committee

Engr. Moroof Ibikunle, FCILTChairman, Public Relations & Strategic

Business Committee

Mrs. Fatima Diko-Kuton, FCILTFemale Representative in Council


Editorial

Editorial Desk

8-11

12-18

16-17

19-21

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25-26AFRICAN CONTINENTAL FREE TRADE AREA (AfCFTA): IMPERATIVES FOR NIGERIA

LOGISTICS AND TRANSPORT IN THE NIGERIA ECONOMY

CILT, PROFESSIONAL SECTOR MAP

MARKETING DESTINATION NIGERIA: THE ROLE OF TRANSPORTATION SECTOR

CORPORATE MEMBERS

Sustaining the BRT Brand Through Service Improvement

Table of Contents

Publisher: The Chartered Institute of Logistics & Transport, Nigeria 15B Awolowo Road, Ikoyi, Lagos.

Tel: +234(01)4536689

Editor-In-Chief: Alban Igwe, Esq FCILT

Features Editor: Chris C. Madza, MILT

Business Development: Remi Ajiboye, CMILT

Margaret Ogbonnah, CMILT

Administration & Circulation: Paul Ndibe, FCILT

Graphics: Owolabi Benjamin, MILT

Production Consultant: Images & Pix Ventures

Tel: 08181589894

Editorial Team

Recently, the Federal Executive Council approved a portfolio investment of N250bn for developing world class Special Economic Zones and industrial parks in the

country. These new zones have been identified and would be sited at Lekki, Aba, Funtua, Calabar and Kano. They would also site Greenfield Special Economic Zones in Akwa Ibom, Benue, Ebonyi, Edo, Gombe, Kwara and Sokoto States. At locations where we have existing economic or free zones, the zones would be further enhanced and developed to world class standards to stimulate industrialization. At the locations above where free zones have not yet been established, the Federal Government would create and similarly develop the identified sites to world class standards of free zones.

The compelling economic attractions to investments in developing economic zones are usually high, but they do not confer equal high returns, especially where their supporting and auxiliary sectors are equally not developed to world class standards, as to yield equal returns. Their level of returns depends on the state of infrastructure availability of their supporting sectors. For more economically beneficial economic zones to result there should be basic primary products or services the specific economic zone would depend upon to generate internal resources for the zone. Secondly, there should be adequate provision of logistics and transport infrastructure base to facilitate the high trade volumes the zones would generate. Thirdly, as some of these special economic zones are on the mainland and not within Nigeria’s maritime space,

BEYOND THE N250bn PORTFOLIO INVESTMENTS IN THE NIGERIAN SPECIAL ECONOMIC ZONES COMPANY LIMITED


Editorial

it connotes that the road and rail transportation modes would be critical for their sustenance and prosperity. Additionally, there should be major raw materials or semi-processed products that would constitute the primary resource inputs for them.

Funtua, Aba and Kano are situated along the open railway network, even though of the narrow gauge structure. Lekki and Calabar are not currently on any railway network. Out of the seven states listed for green field special economic zones, three are not connected to the railways, while four states are linked. Besides the advantages of this specific transportation infrastructure to support the growth of these zones, we should be worried about the absence of other influencers to growth. The choice for Funtua may be based on its cotton fields. Regrettably, many of the functional mills are not close by, in terms of location and would depend on some forms of transportation to move the raw materials to the mills and for export. We are aware of the difficulties these mills had faced in the past that resulted in their sudden shutting down. Therefore, if the Funtua’s special economic zone must flourish, there would be palliative supports for assisting the mills to run at full or near full capacities. Aba’s zones may be targeting their vibrant cloth making and shoe manufacturing subsectors but again, where is the International market for these products. If their cloth making specialty must be encouraged, logistics and transportation links must be strengthened and connection made between Funtua and Aba. In this case, the most preferred means should be the railways. Kano has the population, and its semi processed products may be the target. Internal distribution networks and for feeding other sectors, including those for exports, must depend on

sustainable means of transportation.

In Lagos, the Lekki Free Trade Zone is already underway and the feeling is that all partners are already at site with varying levels of project developments, including the components of oil and gas sub-sector. Calabar may appear strategically positioned, because of its access to the water front, but its poor shallow water level and the absence of the State’s strong investments in agriculture, as opposed to tourism may jeopardize growth in this sector, unless there is a drastic change in its policy.The same Federal Executive Council (FEC) that approved these special economic zones had previously awarded contracts for the new railway design and construction along some states and routes. Luckily, the Lagos – Benin - Calabar Standard Gauge Railway Line may hopefully support the zones in Lekki, Lagos; Edo, for Benin and Calabar, for Cross River State; and possibly Akwa Ibom State. Except there is another new initiative around improving the network connection to Aba, Kano and Funtua, in terms of the rail poundage and gauge, otherwise the future of those zones would have big transportation exposure risk.

Incidentally too, the Inland Container Depots and the Freight Stations are located in Aba, Funtua and Kano. Their impact may have additional mutual economic benefits arising from additional installed facilities and more investment portfolios that will further shape the economic fortunes of the zones. In the other locations, efforts must be made to grow their economies, in the real sector, in order to generate the much needed resource inputs for the zones. To this end, State Governments and individual investors, private sector holdings, must partner to start growing

their immediate economies at their primary levels.

Measures like these would create employment, reduce poverty and create opportunities for building sustainable transportation infrastructure that would support the growth of the zones and aid development of the other sectors.

In conclusion, within the context of trade facilitations for these zones, attention should and must be given to the transportation infrastructure that will support their activities. Gradual phasing out of the railway’s narrow gauge system connecting to the existing zones and those planned in the immediate future, should be embarked upon, Specific policy framework on the provision of logistics and transport infrastructure support for each of the zones must be developed and funded for immediate implementation. This will forestall situations where the zones would be ready, but the logistics and transport infrastructure facilities to support their activities are yet to be put into place or are non-existent. The focus of the Government would not only be on the core investments for the zones as already seemed to have been done. It must stretch to areas that will facilitate the growth and sustainability of the zones, with an eye on trade facilitations. Additionally, the wider markets for the zones should be at the centre of Governments efforts, Accordingly, with the wider market areas of African Countries appear to have been expended under the African Continental Free Trade Area, AfCFTA, the expectation is that the output from these special zones would target the greater African market. If this is achieved, it will help to rapidly grow our economy and the expected development of activities in our real sector would then translate into increased contributions from all sectors of the Nigerian economy.

Lagos

Katsina

Kano

Ca

labar

Sokoto

Benue

Edo

3

1

Gombe

e

Kwara

KEY–NIGERIANSPECIALECONOMICZONESCOMPANYLIMITED

A. ExistingZonesi. Calabarii. Kano

B. NewZonesi. Lagosii. Aba(2)iii. Katsina

C. GreenFieldsi. AkwaIbom(3)ii. Benueiii. Ebonyi(1)iv. Edov. Gombevi. Kwaravii. Sokoto

2


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Logistics Outlook


Logistics Outlook

1. Background of the Development Agenda of the African Union

Africa is a unique continent with territorial boundaries of its component states

that had cut ‘arbitrarily, ethnic, cultural, traditional’ and linguistics borders1. This has remained as one of the identities of the colonial era, which ended in the 1960s. Happily enough, the birth of the 55 member countries of the Organization of Africa Unity (OAU), helped to ensure territorial sovereignty, with limitations on the national affairs of its Members. To offer greater leverage on their national affairs, Regional Economic blocs were formed in the 1970s, to help promote unity and solidarity among its members

Since inception, the OAU, as it was then known and called, had remained in the fore front of shaping the path for the economic growth of Africa. It has, from time to time, formulated various development agenda for the continent. These include the establishment of institutions, economic blocs, agencies and bodies for piloting various development projects in response to the various world development challenges. At various times, the OAU had established different initiatives that would afford the continent, the capacity for inclusiveness in world affairs. There was the initiative on Africa’s response to the World Banks’ Structural Adjustment Programme, introduced to address the effect of falling prices in the commodity market. It was known as the AAFSAP (Africa Alternative Framework to Structural Adjustment Programme)2. There was the Lagos Plan of Action and the APPER (Africa’s Priority Programme for Economic Recovery). At the time of reduced volume of economic assistance to Africa in the

early 1980s due to the advent of the changing patterns of bio-technology and reduced demands on agricultural produce from Africa, there was yet another Africa’s response in the form of the NAI, the New African Initiative. With the advent of globalization, where systems and codes were used to replace human capital through Information and Communication Technology adaptation, Africa from increasingly being excluded from the information super highway, through the OAU, rose to the occasion and came up with an initiative known as AISI, the Africa Information Society Initiative. There was also the initiative on promoting growth in the aviation sector, when it was becoming difficult for any African airline to operate and sustain their routes to Europe, due to the changing regulations on noise, emissions and urban development, on one hand, and the increasing difficulty of flying to major African cities from within Africa, without first flying out of Africa, there was yet another response in the form of the Yamassoukrou Declaration3. There was also the Abuja Treaty of 1990, which was signed in 1991 to establish the African Economic Community.

At the 2001 OAU Summit, the African heads of state and government, ‘adopted the New Partnership for Africa’s Development, (NEPAD), as a further vector to accelerate African economic cooperation and integration4, following the impressive impact of Africa’s New Economic Partners (NEP), popularly known as the New Development Partners, of Brazil, China, Russia, Turkey, India, South Korea and Malaysia. In 2002, following the diversifying role of the OAU, in the planning and implementation of development programmes under the Regional Economic Blocs, REC, formed the Africa Union, to formally replace the OAU. This essentially was in recognition that ‘African economic integration is best pursued on a regional basis’5. The above initiatives, fashioned at various times, were according to TUROK,6 to “respond to the current globalization wave and ensure the appropriate integration of Africa’s economy into the world economy”, through privatization and regional economic growth and development, that will promote free trade policies and strengthen the individual countries’ economic structures and cross border trade and integration.

Regrettably, due to the changing dynamics of the world economy and absence of ‘an effective model for infrastructure development based on

AFRICAN CONTINENTAL FREE TRADE AREA (AfCFTA): IMPERATIVES FOR NIGERIA

By: Paul Ndibe, FCILT


Logistics Outlook

the Public-Private Partnerships (PPP) options7, each of these initiatives, before NEPAD, was only effective in addressing a limited section of Africa’s problems. They essentially fall short of establishing the main infrastructural and financial base for Africa’s full economic prosperity. As the world economy continues to change and Africa, in turn endeavors to keep the pace, despite huge political challenges, there is the need to still focus on the direction of the world economy and to design approaches Africa would adopt in facing the increasing dimensions of the parameters in the market place.

2. The Ever Changing World Economy And Its Various Development Phases

As the new order for economic growth is tilting towards trade and services, followed by the rise of some Africa countries among the identified ‘emerging economies’, with Africa being tipped as the third fasting growing region, it is not surprising that the African Union should come up with a new growth agenda for the continent. This new agenda is essentially focusing on the concept of trade and services. There was the pronouncement on the ‘Single African Air Transport Market’ (SAATM), and also the African Continental Free Trade Area, (AfCFTA)8. These two propositions which in the first case, was initialed by 24 countries and in the case of the second one, initialed by 49, out of the 55 member countries of Africa, are new sets of development agenda for Africa, in response to the current changing pattern of the world economy. Just like in the early days of globalization where content and systems’ applications were constituting major challenges in Africa’s entry into the information super highway, Africa Union encouraged Africa’s immediate entry, but at various points where the individual country could muster the capacity for such entry. This was achieved through the Africa Information Society Initiative9. Thus, South Africa, Kenya, Egypt, Ghana and Nigeria entered the information age at their different levels in the chain and had since then grown in content and in application software developments, including hardware component manufacturing.

Similarly, the new call for SAATM, which seeks to entrench clear framework for operations and regulations, as an improvement on the Yamassoukrou Declaration, is to fully encourage the

participation of African countries in the aviation sector, where new opportunities are being exploited. Nigeria, as at today is not harvesting in this field due to lack of a national carrier. Countries like Ethiopia that seized this opportunity and invested in the provision of the required facilities for this sector, is currently reaping the advantage, as the leading airline in Africa with revenues of over $2.43bn from carrying 7.6 million passengers in 2015 – 2016. It is equally an established fact that it is the largest African Airline by profit, according to the records of the International Air Transport Association (IATA). It is note-worthy to remark that its Net Profit grew by over 70% during the same period. With such impressive records and the projections for growth of passenger traffic in the sector to 303 million by 2035, Africa should rise up and take back its fair share of the market, where it currently holds 2.2% of the world market. In a market situation where the entire African airlines lifted in 2015, a volume of 79.5 million passengers and gears towards competing for the projected 303 million passenger projection by 2035, it is not surprising that the Africa Union should provide a guide to stimulate individual country’s response to it. Nigeria alone, with a population of 200 million and with a current 10% of that population desiring air travel will be enough to create the desired market for sustaining a national carrier10.

3. The Single African Air Transport Market and the Continental Free Trade Area

Just as the Africa Union had projected the line of response to air travel needs of Africa, it has similarly outlined a line of response for facilitating trade through the initiative on the Continental Free Trade Area. The focus for this targets a market capacity of 1.2bn people with a combined GDP of $2.5 trillion, as the largest trade zone in the world. It will also aim at removing Tariffs on 90% of goods and facilitate the free movement of business people within the African Continent. AfCFTA will increase intra African trade by 52% by the year 2022, liberalize services and tackle other barriers to intra African trade like delays at the border posts. With the current intra African trade standing at 18% of total trade, which compares negatively to 59% in Asia and 69% in Europe, the full implementation of the ideals of AfCFTA would boost cross border trade that people are unaware that it best meets their expectations as market with a high

level of predictability.The benefits AfCFTA presents to Africa include:a. Boosting employment opportunities.b. Increased food security through reduction to barriers on trade in agricultural products.c. Increased competitiveness of African industrial products through harnessing the economies of scale of a continent wide market.d. Increased rate of diversification and transformation of Africa’s economy and the continent’s ability to supply its import needs from its own resources.e. Better allocation of resources, improved competition and reduced price differentials.f. Growth of intra-industry trade through regional value chains and development of geographical based specialization.g. Reduced vulnerability of countries to external trade shocks, by reducing the trade balance deficits of African countries.h. Enhanced participation of Africa in global trade and reduced dependency on aid and external borrowing.To some observers, the AfCFTA will lead to the opening up of investment opportunities for Africa’s Development Partners that will now have broad areas of investments to complement the infrastructural facilities they have been building. It will help ‘promote innovation and integration through protection of the intellectual property rights of the African private sector’11, Startups, through Nigeria’s broad base Small and Medium Enterprises (SME) programmes are more likely to innovate towards technological advancements that will open up to free market12. AfCFTA would allow freer access with each Economic Zone and stimulate greater efforts in the campaign for the ‘Ease of doing Business’, whose overall aim is to stimulate trade and services.

If AfCFTA targets to boost intra African trade, it presupposes that as the size of cross border trade is increasing, informal trade across the border, which usually is a sizeable percentage of the continent’s trade volume, would certainly decrease, as there would not be a major incentive in advancing such trade. In order to reasonably tackle informal cross border trade, AfCFTA would allow for the aggregation of trade under a common framework that will provide for full disclosure required under a uniform


Logistics Outlook

tariff regime.

The advantage in the AfCFTA is that African countries would identify where their individual economies of scale lay and invest more in them. Secondly, for countries to gain greater market share, they have to overhaul their infrastructure network to suit current realities and to build new ones that will aid growth in the new economic dispensation. The question of trade finance, which has reduced the scope and range of trade in Africa, would come to prominence again. Under AfCFTA, there should be an answer to the over $90 trade finance gaps in Africa. Huge trade volumes would necessarily attract insurance policies and credit ratings that will influence loans grants and credit that are not readily available now. Institutions like the Africa Development Bank, the Afreximbank and their associated partners, are already gearing towards providing trade loans and financial supports for intra-African exports13.

The next challenge for Africa on AfCFTA is not on whether Nigeria and five other countries have signed the pack, (that 89% of countries in Africa have endorsed), but on identifying the appropriate vehicles for fully establishing the workings of the AfCFTA. The international road high way, the air traffic hub, the standard gauge arrangement for the railways and the need for connectivity along the identified path, should concern African Governments. The maritime capacity for dealing with the increased cargo inflow and out flow should be confronted now through the establishment of maritime hubs in suitable ports with good draught for accommodating heavier and high capacity cargo vessels14. As already in the public domain, the shallow nature of our ports can’t allow bigger ships with higher TEUs to berth in our ports.

It is disinteresting to note that Nigeria has not yet signed into the AfCFTA. In an effort to stimulate domestic economic growth, Small and Medium Enterprises are being encouraged and supported to grow. Growth is associated with output. With the expansion of Nigeria’s domestic market under the AfCFTA, these enterprises would have a wider market horizon to operate. AfCFTA would allow for more strategic alliances and formation of groups for production and increased economies. Nigeria should not distance itself from the advantages this noble initiative presents. It is no longer news that Africa would not be able to compete with the developed

economies on the line of machinery and high technology products. Therefore, the immediate market where Africa may triumph would be on raw materials and semi-processed goods that will feed both the markets in the developed economies and our local African markets, where competition would be less and foreign exchange variability would not harm production.

4. Globalization And The Growth Of The New Economic Environment Of Trade And Services

Globalization and inclusiveness is the order of the day. Accordingly, the call for African countries to key into the AfCFTA initiative is a golden opportunity for Nigeria, and other nations that are yet to sign in. They are to simply start, in good time, to identify their strength, weaknesses and opportunities and then commence the re-building of the appropriate infrastructure that will constitute treats in widening their market horizon. This, they can smartly achieve through private sector involvement15, as argued in the report of African Business of May, 2018. With respect to Nigeria, as argued in the Punch Newspaper Editorial of 5th April, 2018 its huge population; large economy, with a GDP of $405.1 billion; 77 million estimated current working population; large informal economic sector; a youth population of about 90 million and a borderless African market presents a golden opportunity to explore the benefits AfCFTA offer.

AfCFTA, as reported in the African Business Magazine, of May, 2018 page 18, is a Pan-African, socio - economic development, post 21st Century economic initiative that will serve the best interest of all African countries, depending on their level of preparedness to seize the opportunity that comes with this great effort of the Africa Heads of state and government. It is in this question of the level of preparedness of the individual African Countries, raised in that report that Nigeria should worry about and not necessarily, on whether it will benefit greatly from the free trade area. AfCFTA, as a gateway to economic growth and prosperity of Africa, floating an African free trade area is simply a radically new intervention approach, aimed at providing unique opportunities for African Countries to take full control of their development agenda, to work more closely together and to co-operate more actively, with

international partners, in the growth and development of Africa. As noted by Tim Marshall, (2016), economic, social and demographic changes are known to result from technological changes that have global implications16. Consequently, Nigeria’s endorsement of the Continental Free Trade Area would open it up to the need to acquire the capacity for new infrastructure facilities, new technologies, specialized human capital and the introduction of more efficient ways of growing businesses that would positively impact on its economic, social and demographic changes.

5. Conclusions

In view of the foregoing, the major attention of the Nigerian Government should be in the area of dredging the ports and installing newer facilities that can handle the demands of the expected huge traffic this initiative will bring. There should be rigid requirements for our numerous free trade and economic zones, in terms of the draught for ships calling at such facilities. This is one good way to ensure efficiency of the ports through acceptance of larger capacity vessels with higher volumes of TEUs.

There should also be laid out inter-modal links that will support the high level of traffic demand in terms of quick evacuation of cargoes from the ports. The long standing issues relating to the take-off of the Inland Container Deports and Freight Stations should be addressed now. Meaningful efforts should be exerted in the establishment of truck transit parks and in the classification of trucks and their axile load, as well as, their carrying capacities. Along this thinking, this is a wake-up call to review the on-going railway projects and align them in such a way that they will support the initiatives under the AfCFTA. The table below, (as reported in This Day Newspaper of Friday April, 20th 2018, page 23), shows the current activity levels of our ports. Their poor operational record would drastically worsen under AfCFTA, if meaningful action is not taken to create the adequate infrastructure that will enable trade and services to flourish when AfCFTA becomes operational. The same statistics is an indication that under AfCFTA, attention should be given to the issue of the ‘Ease of Doing Business’ in Nigeria, in order to grow our economy, otherwise non-formal barriers to trade and services, would stifle the level of access and inclusiveness of Nigerian businesses in a AfCFTA regime.


Logistics Outlook

References:1. African Business, (May, 2018) ‘The

CFTA: Moving African integration further forward’. An IC Publication, No. 452, page 22.

2. Aiyepeku, W. (1995) ‘Developing Information for Development Information’. Inaugural Lecture,

University Press, Ibadan.3. Ndibe, Paul. (2018) ‘Logistics and

Transport Digest’. A publication Journal of the Chartered Institute of Logistics and Transport, Nigeria. March, 2018, page 5.

4. African Business Opt. cit. No. 1.5. Ibid

6. Turok, B. (2002) ‘The New Partnership for Africa Development (NEPAD)’, in K. Omotoso (Ed), New Agenda (South African Journal of Social and Economic Policy), London IFAA.

7. Ndibe, Paul. Opt. cit. No. 3.8. The Punch Newspapers, (Editorial),

Thursday, April, 5th 2018 page 17.9. Aiyepeku. W. Opt. cit. No. 2.10. New African Magazine ‘Towards

One African Sky’. No. 580, February, 2018, page 27.

11. New African Magazine ‘Innovation Nations’ in Towards One African Market No. 580, February, 2018, page 26.

12. Natanyahu, Binyamin ‘The Economist – The World in 2018’. The Adelphi, London, 2017, page 90.

13. African Business. Opt. cit. page 18.14. African Business. Opt.cit. page 72.15. Okonji, Emma, ‘Afreximbank:

AfCFTA’s Success Depends on Traded Goods from Private Sector’. This Day Newspaper, May 3rd, 2018 page 24.

16. Marshall, Tim, (2016) ‘Prisoners of Geography: Ten Maps that tell everything you need to know about Global Politics’. Elliot and Thompson Limited, London, 2016, page (i).

AAll scattered in the streetVisible to every cornersDedicated to the rain and sunjust like obeying the clarion call They wish not for this courseLonging for strength to riseBut nature held them bendCast not the stone on them

-By: Oladayo Joseph Okelola

Give a smile to themStretch forth an arm to themLove them with words to bearBless them with gifts till they blend They are the beggars we seelet’s love them as equalto show Christ we loveTill he comes as a beggar in the night

DON'T CAST THE STONE

Looped from This Day Newspaper of Friday, 20th April, 2018, page 23.


Logistics Outlook

LOGISTICS AND TRANSPORT IN THE NIGERIA ECONOMY Nwankwo, Chika O. (CMILT)1* and Baba, Madu 2

Abstract

The study examined logistics and Nigeria’s economy with focus on the growth rate of all modes of transportation (including courier services) and

their contribution to Nigeria’s Real Gross Domestic Product (RGDP). Data were collected through secondary sources from the National Bureau of Statistics (NBS). Data were analyzed using tables, percentages and charts. Findings revealed that the Transport and Storage sector highest contribution to Nigeria’s RGDP for the years reviewed is 1.53% in 2016. The highest growth rate of 7.08% was in 2007. The study shows that Transport and Logistics Sector of Nigeria’s economy is statistically reliable to predict the Real Gross Domestic Product of the economy. It is recommended that the Nigeria government should handle all logistics (transport, handling and storage ) matters from an integrated logistics point of view and should as well domesticate the Chartered Institute of Logistics and Transport (CILT) to serve as a regulatory body for proper professionalization of the transport industry. This will help to enhance the positive growth of the sector and positive contributions to the economy.Key words: Logistics, Transport, Nigeria, Economy

INTRODUCTIONCountries of the world perform differently when it comes to logistics. This bring about variations and gaps. There is a wide margin between countries that perform best and worst in trade logistics. This gap exists as a result of the complex nature of logistics-related reforms and investment in developing countries of the world (World Bank, 2014). Currently, logistics practices and practitioners’ world over are adopting best practices that are timely, cost-effective, dependable and integrated (Amba and Danladi, 2013). Global supply chain management depends on Logistics as the backbone. Lately,

logistics is being seen and accepted as a strategic industry that contributes positively to the economy of every nation (Abu Bakar, Jaafar, Faiso and Muhammad, 2014). The world economy is rapidly developing into a service-driven economy. Logistics as a leading driver plays an increasingly more significant role in the development of the economy of countries (World Bank, 2014). The 2011 World Development Indicators show that the services sector accounted for about 71% of Global Gross Domestic Product in 2010 and is growing more rapidly than Agriculture and Manufacturing sectors. As a matter of economic fact, the growth of the service sector has for long been considered as an indicator of a country’s economic progress. The Nigeria Logistics sector is estimated to be over 200 billion Naira and is estimated with the capacity to contribute about 10% of Nigeria’s Gross Domestic Product even though the present contribution is less than 4%. Given the above scenario it is obvious that there is a huge gap between what is in place and what ought to be (Chartered Institute of Logistics and Transport, 2017).

Despite rapid contributions of logistics to the economic development of many countries, logistics contribution to the economy of Nigeria is not at its best. In the light of this, this paper examines the impact of logistics in Nigeria’s economy in order to propose policy framework for integrated logistics system in Nigeria.

1. LITERATURE REVIEWThere have been several publications by different authors on issues relating to transport (logistics) sector contributions to Nigeria’s Gross Domestic Product and economy in general. Njoku and Ikeji (2012), investigated the effect of the quality of transport infrastructure on the Nigerian economy. Budgetary Allocation for Transportation and Contributions of the Transport sector to the gross domestic product (GDP) were the variables used. Findings showed that the transport sector’s contribution to the economy increases with investment in


Logistics Outlook

transport infrastructure; transport sector made significant contribution to GDP and inadequate funding was a major challenge to the development of transport sector. Also, Ayantoyinbo and Ekundayo (2015) examined the relative importance of the transportation sectors in the Nigerian economy. The study explored the level of the inter-sectoral connectedness of transportation sectors with other sectors of the economy. Findings showed that Road transport was forward and backward oriented, while rail transport and pipelines, water transport, air transport and transport services were found to be backward-oriented. Ejiba and Omolade (2016), examined aggregated GDP time series data for the period 1991 – 2010. Focus of the study was to analyze the contributions of each sector to Nigeria’s GDP growth. Findings showed an increasing trend in aggregate GDP for the study period, with an average GDP growth rate of 4.98%. Amba and Danladi (2013), evaluated the Nigerian transport sector with focus on aviation and railway sub-sectors. The findings

showed a low and a continuous fall in the activity of transport sector in Nigeria. The study identified high operation cost and inadequate funding as major challenges facing the sub-sectors.

2. MATERIALS AND METHODSSecondary data (2006-2016) on the transport and storage sector contributions to national GDP were used for this research. The data were obtained from the National Bureau of Statistics, Nigeria (National Accounts Report, 2016). This period was chosen based on the availability of data, transport and logistics industry development and political stability.

3. RESULTS AND DISCUSSIONThe results and discussion is based on data gotten from secondary sources, however, analysed by regression and descriptive analysis.

Table 1: Nigeria’s Transportation and Storage Sector Current GDP (=N= Million) 2006-2016

Year Road Transport (=N= Million)

Air Transport (=N= Million)

Water Transport (=N= Million)

Rail & Pipeline Transport (=N= Million)

Transport Services (=N= Million)

Nipost & Courier Services (=N= Million)

2006 363,339.03 22,413.10 3,312.78 75.23 17,846.66 7,845.03

2007 421,473.27 25,442.66 3,505.55 81.94 18,931.28 8,943.34

2008 488,909.00 25,747.98 3,698.31 87.94 20,015.90 10,195.40

2009 567,134.44 29,204.15 3,896.94 90.94 21,176.27 11,622.76

2010 619,136.86 32,673.90 4,225.75 107.77 22,646.26 15,981.28

2011 670,804.09 56,494.78 5,041.06 135.61 30,013.85 16,864.30

2012 784,810.74 65,608.82 5,570.36 185.50 42,177.54 18,962.79

2013 893,127.83 76,914.10 6,220.46 216.43 53,053.24 21,689.43

2014 1,017,156.37 84,407.81 7,148.85 252.50 63,545.97 24,924.16

2015 1,156,293.33 95,735.98 8,071.98 282.10 72,952.66 27,729.23

2016 1,358,682.97 94,500.59 8,924.90 309.73 82,245.90 28,856.04

Source: National Bureau of Statistics, National Accounts Report, 2016(Key to tables: (=N= means Nigeria Naira; % means Percentage)

Table 1 shows the distribution of Nigeria’s Transportation and Storage Sector Current GDP (=N= Million) from 2006-2016. Year 2006 had the least transport and storage sector current GDP while Year 2016 had the highest transport and storage sector current GDP. In the years Road transport sub-sector appears to be the driving force of the sector followed by Air transport, Transportation Services and Post (NIPOST) and Courier Services.

Table 2: Nigeria’s Transportation and Storage Sector Real GDP (RGDP) (=N= Million) from

2006-2016

Year Road Transport (=N= Million)

Air Transport (=N= Million)

Water Transport (=N= Million)

Rail & Pipeline Transport (=N= Million)

Transport Services (=N= Million)

Nipost & Courier Services (=N= Mil-lion)

2006 473,395.88 24,371.24 3,374.80 85.45 18,068.87 10,698.49

2007 506,584.02 26,213.74 3,578.79 90.85 19,177.49 11,863.61

2008 542,196.87 28,203.38 3,795.32 96.38 20,362.66 13,157.95

2009 579,682.27 30,436.83 4,010.28 101.92 21,475.53 14,505.65

2010 619,136.86 32,673.90 4,225.75 107.77 22,646.26 15,981.28

2011 637,003.73 51,889.95 3,814.06 121.82 26,960.75 16,452.94

2012 601,854.84 54,099.70 3,750.51 146.86 33,392.30 17,832.03

2013 616,125.63 59,139.72 3,919.20 159.66 39,136.21 19,598.11

2014 639,304.77 60,867.24 4,261.77 171.80 44,692.90 21,392.43

2015 667,810.60 63,120.21 4,621.74 176.39 47,111.52 22,615.28

2016 679,305.23 60,054.09 4,686.63 175.25 46,584.26 17,791.83

Source: National Bureau of Statistics, National Accounts Report, 2016


Logistics Outlook

Table 2 shows the distribution of Nigeria’s Transportation and Storage Sector Current GDP (=N= Million) from 2006-2016. Year 2006 had the least transport and storage sector current GDP while year 2015 and 2016 had the highest. In all the years reviewed, Road transport sub-sector appears to be the driving force of the sector followed by Air transport, Transportation Services and NIPOST and Courier Services.

Table 3 and figure 1 shows the distribution of Nigeria’s Transportation and Storage Sector Contributions (%) to Total GDP from 2006 – 2016. The contributions are as follows; 2006 (1.45%); 2007 (1.45%); 2008 (1.40%); 2009 (1.43%); 2010 (1.27%); 2011 (1.24%); 2012 (1.28); 2013 (1.31%); 2014 (1.34%); 2015 (1.45%) and 2016 (1.53%). Figure 1 shows the individual mode contribution to GDP.

Table 3: Nigeria’s Contribution of Transportation and Storage sector to Total GDP (%) from

2006 - 2016.

Year Road Transport (%)

Air Transport (%) Water Transport (%)

Rail & Pipeline Transport (%)

Transport Ser-vices (%)

Nipost & Courier Services (%)

Total Transpor-tation Sector Contributions to GDP (%)

2006 1.6516 0.0850 0.0118 0.0003 0.0630 0.0373 1.45

2007 1.7674 0.0915 0.0125 0.0003 0.0669 0.0414 1.45

2008 1.8917 0.0984 0.0132 0.0003 0.0710 0.0459 1.40

2009 2.0224 0.1062 0.0140 0.0004 0.0749 0.0506 1.43

2010 2.1601 0.1140 0.0147 0.0004 0.0790 0.0558 1.27

2011 2.2224 0.1810 0.0133 0.0004 0.0941 0.0574 1.24

2012 2.0998 0.1887 0.0131 0.0005 0.1165 0.0622 1.28

2013 2.1496 0.2063 0.0137 0.0006 0.1365 0.0684 1.31

2014 2.2305 0.2124 0.0149 0.0006 0.1559 0.0746 1.34

2015 2.3299 0.2202 0.0161 0.0006 0.1644 0.0789 1.45

2016 2.3700 0.2095 0.0164 0.0006 0.1625 0.0621 1.53

Source: Authors’ computation (2017)

Figure 1: A bar chart showing distribution of Nigeria’s Contribution of Transportation and Storage contribution to Total GDP (%) from 2006-2016.Source: Graphed with data from National Bureau of Statistics, National Accounts Report, 2016


Logistics Outlook

Table 4: Nigeria’s RGDP Transportation and Storage Growth Rate (%) from

2006-2016

Year Road Transport (%)

Air Transport (%) Water Transport (%)

Rail & Pipeline Transport (%)

Transport Ser-vices (%)

Nipost & Courier Services (%)

Total Transpor-tation Sector Growth Rate (%)

2006 6.97 7.54 6.03 6.31 6.12 10.88 7.04

2007 7.01 7.56 6.04 6.32 6.14 10.89 7.08

2008 7.03 7.59 6.05 6.09 6.18 10.91 7.10

2009 6.91 7.92 5.66 5.75 5.47 10.24 6.98

2010 6.81 7.35 5.37 5.74 5.45 10.17 6.85

2011 2.89 58.81 -9.74 13.04 19.05 2.95 5.97

2012 -5.52 4.26 -1.67 20.55 23.86 8.38 -3.42

2013 2.37 9.32 4.50 8.72 17.20 9.90 3.80

2014 3.76 2.92 8.74 7.60 14.20 9.16 4.42

2015 4.46 3.70 8.45 2.67 5.41 5.72 4.51

2016 1.72 -4.86 1.40 - 0.65 -1.12 -21.33 0.39

Source: Authors’ computation, (2017)

Figure 2: A bar chart showing distribution of Nigeria’s RGDP Transportation and Storage Growth rate (%) from 2006-2016.Source: Graphed with data from National Bureau of Statistics, National Accounts Report, 2016

Table 4 and figure 2 shows distribution of Nigeria’s RGDP Transportation and Storage Growth rate (%) from 2006-2016. The growth rate are as follows; 2006 (7.04%); 2007 (7.08%); 2008 (7.10%); 2009 (6.98%); 2010 (6.85%); 2011 (5.97%); 2012 (-3.42%); 2013 (3.80%); 2014 (4.42%); 2015 (4.51%) and 2016 (0.39%). The individual mode growth rate can also be seen both in the table and in the bar chart.

Table 5: Nigeria’s RGDP Transportation and Storage Contribution and Growth rate GDP (%) from 2006-2016

Year Total Transportation Sector Contribution to Total GDP (%) Total Transportation Sector Growth Rate (%)

2006 1.45 7.04

2007 1.45 7.08

2008 1.4 7.1

2009 1.43 6.98

2010 1.27 6.85

2011 1.24 5.97

2012 1.28 -3.42

2013 1.31 3.8

2014 1.34 4.42

2015 1.45 4.51

2016 1.53 0.39

Source: Source: Author’s computation, (2017)

Continued on Page 18


FORUMS

PROFESSIONALSECTORS

Light Rail& Tram

Light Rail& Tram

Light Rail& Tram

Accessibility& Inclusion






Food Logistics

Retail Logistics Retail Logistics

Retail LogisticsRetail Logistics

FoodLogistics

FoodLogistics

Food LogisticsRoad FreightTransport

Road Freight Transport

Construction Supply Chain

Defence Supply Chain

Logistics Research Network (LRN)

TransportManagers

Roads & Traffic PolicyRoads & Traffic Policy

Roads &Traffic Policy

Transport Modelling

Transport PlanningTransportPlanning

Travel DemandManagement




Bus & CoachBus & CoachBus & Coach

Benchmarking

Customs &International Trade

Compliance

PassengerTransport

Security

Cycling

Rail Freight

Passenger Rail

Walking

PassengerTransportSecurity

Strategic Rail Policy

LogisticsSafety

FreightForwarding

Freight Forwarding

Ports, Maritime& Waterways


Compliance

Customs &International TradeCompliance

Freight Forwarding

FreightForwarding

Logistics Safety

AviationPolicy

AirportAccess

TransportManagers

TransportManagers

Logistics Safety


Passenger Transport Security

Humanitarian Logistics (HELP)

Benchmarking

OffshoreLogistics

PMD Work Measurement

Offshore Logistics

Offshore Logistics

TransportManagers

Outsourcing & Procurement

Roads & TrafficPolicy

Reverse Logistics

LogisticsSafety

Supply Chain Inventory Management

Road FreightTransport

Environment & Sustainability


Environment & Sustainability Environment & Sustainability


Environment &Sustainability

Data Capture & Information Management

Food Logistics

Logistics Simulation

Retail Logistics

Value Chain

Warehouse Management Systems

Warehouse & Materials Handling

Light Rail& Tram

SupplyChain

TransportPlanning

RailActive

Travel & Travel Planning

Bus & Coach

PortsMaritime

Waterways

FreightForwarding Aviation

Public Policy

Young Professionals

Benchmarking

Benchmarking

Benchmarking

Airport Access

Airport Access Airport Access Roads & Traffic Policy

Benchmarking

Airport Access

BenchmarkingBenchmarking

FORUMS

PROFESSIONALSECTORS

Light Rail& Tram

Light Rail& Tram

Light Rail& Tram







Food Logistics



FoodLogistics

FoodLogistics






TransportManagers



Transport Modelling







Benchmarking


Compliance

PassengerTransport

Security

Cycling

Rail Freight

Passenger Rail

Walking



LogisticsSafety

FreightForwarding

Freight Forwarding



Compliance


Freight Forwarding

FreightForwarding

Logistics Safety

AviationPolicy

AirportAccess

TransportManagers

TransportManagers

Logistics Safety




Benchmarking

OffshoreLogistics


Offshore Logistics

Offshore Logistics

TransportManagers



Reverse Logistics

LogisticsSafety









Food Logistics


Retail Logistics

Value Chain



Light Rail& Tram

SupplyChain

TransportPlanning

RailActive


Bus & Coach

PortsMaritime

Waterways


Public Policy

Young Professionals

Benchmarking

Benchmarking

Benchmarking

Airport Access


Benchmarking

Airport Access


The Chartered Institute of Logistics and Transport, Nigeria CILT Professional Sector Map

Logistics Outlook


FORUMS

PROFESSIONALSECTORS

Light Rail& Tram

Light Rail& Tram

Light Rail& Tram







Food Logistics



FoodLogistics

FoodLogistics






TransportManagers



Transport Modelling







Benchmarking


Compliance

PassengerTransport

Security

Cycling

Rail Freight

Passenger Rail

Walking



LogisticsSafety

FreightForwarding

Freight Forwarding



Compliance


Freight Forwarding

FreightForwarding

Logistics Safety

AviationPolicy

AirportAccess

TransportManagers

TransportManagers

Logistics Safety




Benchmarking

OffshoreLogistics


Offshore Logistics

Offshore Logistics

TransportManagers



Reverse Logistics

LogisticsSafety









Food Logistics


Retail Logistics

Value Chain



Light Rail& Tram

SupplyChain

TransportPlanning

RailActive


Bus & Coach

PortsMaritime

Waterways


Public Policy

Young Professionals

Benchmarking

Benchmarking

Benchmarking

Airport Access


Benchmarking

Airport Access


FORUMS

PROFESSIONALSECTORS

Light Rail& Tram

Light Rail& Tram

Light Rail& Tram







Food Logistics



FoodLogistics

FoodLogistics






TransportManagers



Transport Modelling







Benchmarking


Compliance

PassengerTransport

Security

Cycling

Rail Freight

Passenger Rail

Walking



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FreightForwarding

Freight Forwarding



Compliance


Freight Forwarding

FreightForwarding

Logistics Safety

AviationPolicy

AirportAccess

TransportManagers

TransportManagers

Logistics Safety




Benchmarking

OffshoreLogistics


Offshore Logistics

Offshore Logistics

TransportManagers



Reverse Logistics

LogisticsSafety









Food Logistics


Retail Logistics

Value Chain



Light Rail& Tram

SupplyChain

TransportPlanning

RailActive


Bus & Coach

PortsMaritime

Waterways


Public Policy

Young Professionals

Benchmarking

Benchmarking

Benchmarking

Airport Access


Benchmarking

Airport Access


The Chartered Institute of Logistics and Transport, Nigeria CILT Professional Sector Map

Logistics Outlook


Logistics Outlook

Figure 3: A bar chart showing the summary distribution of Nigeria’s RGDP Transportation and Storage Contribution and Growth rate (%) from 2006-2016.Source: Graphed with data from National Bureau of Statistics, National Accounts Report, 2016.

Table 5 and Figure 3 (figure 3 is a bar chart) shows the summary of the distribution of Nigeria’s RGDP Transportation and Storage Contribution and Growth rate (%) from 2006-2016. The blue graph line represents the Total Transport and Storage Sector Contribution to total GDP. The red graph line represents the Transport and Storage sector growth rate.

5. CONCLUSION AND RECOMMENDATION(S)

The study focused on the contributions and growth of the logistics (transport and storage sector) to and in Nigeria’s economy (GDP). Findings showed that the transport and storage sector impact on Nigeria’s GDP is below 2%. All the modes of transport including Courier Services contribute their share to the GDP although their contributions and growth rate are not strong but could do very well if the sector is taken seriously. The study recommends that the Nigeria government through her Ministries, Departments and Parastatals should handle all transport and storage sector matters from integrated logistics point of view. Finally, the government should

domesticate the Chartered Institute of Logistics and Transport (CILT) to serve as a regulatory body to for proper professionalization of the transport industry, this will help to enhance the positive growth of the sector and positive contributions to the economy.

6. REFERENCESAbu Bakar, M. A., Jaafar, H. S., Faisol, N. & Muhammad, A. (2014). Logistics Performance Measurements -Issues and Reviews. Mar, 2014. Retrieved from https://mpra.ub.uni-muenchen.de/60918/1/MPRA_paper_60918.pdfAmba, D. A. & Danladi, J. D. (2013). An Appraisal of the Nigerian Transport Sector: Evidence from the Railway and Aviation Sub-Sectors. Journal of Economics and Sustainable Development, 4(10), 161 – 170

Ayantoyinbo, B.B. & Ekundayo,B. I. (2015). Inter-Sectorial Connectedness-The Analysis of the Transportation Sectors in Nigeria. European Journal of Business and Innovation Research, 3(3), 14-23Chartered Institute of Logistics and Transport (CILT), Nigeria (2017). Justification for CILT Bill. 1-37.Ejiba, I. V. & Omolade, O. K. (2016). Sectoral Contribution to Nigeria’s Gross Domestic Product (GDP) Growth Rate: A Study of Multicollinearity in Aggregated Time Series Data. Journal of Scientific Research & Reports, 11(1), 1-13. DOI: 10.9734/JSRR/2016/26364

From Page 12


Logistics Outlook

ABSTRACT

The operation of transportation determines the efficiency as well as the ease of tourist

activities in Nigeria. The progress in techniques and management principles improves the moving load, delivery speed, service quality, operation costs, the usage of facilities and energy saving. Transportation takes a crucial part in the manipulation of tourism. Reviewing the current condition, a strong system needs a clear frame of mobility and proper transport implements and techniques to link the tourism destinations. The objective of the paper is to define the role of transportation in enhancing the tourism potentials of Nigeria. The research was undertaken to assist would-be tourists, tourism planners and practitioners to define and comprehend the basic views of tourism and its relationships with transportation.

Key Words: Logistics,Transportation, Tourism

1.0 INTRODUCTIONTourism has become an important industry over the last few decades, and its economic impact, including direct, indirect, and induced effects, has been enormous. Based on a 2014 data set comprised of information from more than 180 countries, travel and tourism contributed $7,580.9 billion, which is equivalent to 9.8% of the global Gross Domestic Product (GDP), and provided 276,845,000 jobs, which is equivalent to 9.4% of total global employment. Tourism’s economic contribution is predicted to increase to an estimated $11,381.9 billion in the coming years (10.5% of GDP), and activities from tourism are projected to add 356,911,000 jobs by 2025 (10.7% of total global employment) (WTTC 2015). Transportation is the of the most important factors that contributes to the success of the tourism industry (Page 2009, Palhares 2003).

Transportation and tourism are inseparable and hence tourism cannot thrive without transportation. Okeudo, Ikenna and Ejem (2009) noted that the importance of transport in the smooth functioning of any city cannot be overemphasized. They equally noted that for a city to grow and develop,

it requires efficient and adequate transportation system to be put in place. Transportation is an integral part of the tourism industry. It is largely due to the improvement of transportation that tourism has expanded. Culpan (1987) identified transportation modes and management as the “important ingredients of the international tourism system,” acknowledging that linkage by air, sea and land modes is essential for the operations as well as the availability of support services such as fuel stations, auto repair, motels and rest facilities for land travel.

Transportation in tourism is most often seen as just part of the tourism system which is in charge of bringing the tourists to the destinations, a means of getting around the place and leaving it once the duration of the trip is over. Transportation system of a tourist destination has an impact on the tourism experience which explains how people travel and why they choose different forms of holiday, destination, and transport. The improvement in transportation modes plus low fares has increased the accessibility of areas once considered off-the-beaten-path. Accesses to tourist sites vary according to the nature of the site, the state of infrastructure, and the efficiency of the

MARKETING DESTINATION NIGERIA: THE ROLE OF TRANSPORTATION SECTOR

By Dr. G. N. Okeudo, CMILT


Logistics Outlook

public transport system.

2.0 TRANSPORTATION SYSTEMS AND TOURISMA strong public transport system, the application of appropriate traffic management schemes, and good linkage with the programs of ecotour operators may alleviate impacts. Coleman’s (1997) study of visitor traffic in North York Moors National Park was aimed in getting the views of both visitors’ and residents’ on the traffic, the environmental and visitor management system employed at the park. It also wanted to formulate a most suitable visitor traffic management scheme that would discourage the reliance on private vehicles and encourage use of public transport. From the results of the study, to encourage modal shift, information on the current usage of public transport and the reasons why tourists/visitors do not utilize it is essential (Coleman, 1997).

It becomes imperatives to review modern trend in the area of mobility that could aid the activities of tourist. Without well-developed transportation systems, logistics could not bring its advantages into full play. Besides, a good transport system in logistics activities could provide better logistics efficiency, reduce operation cost, and promote service quality. The improvement of transportation systems needs the effort from both public and private sectors. A well-operated logistics system could increase both the competitiveness of the government and enterprises.

Advances in transportation have widely eased travel. It is attributed to the ease and accessibility of modern transport that has spurred the widespread growth of nature tourism within India and globally (Honey, 1999). The increase in the number of visitors to what were once remote areas has resulted in degradation and damage of the resources prompting the need to re-evaluate the role of Airlines in the exercise. Impacts of tourism development include soil erosion or compaction, clearance of vegetation to give way to roads and tourism facilities, recreation use of off-road vehicles, trail bikes, snowmobiles, horses, and even the trampling of pedestrians (Buckley, 1996).

The careful planning of sensitive areas which includes the utilization of zoning to determine areas for facilities and tourist activities and to protect natural areas and discourage development, and the planning of roads, hiking and riding trails should be integrated into the

natural environment (Inskeep, 1987).

The modes we choose and how we travel are indicators of our level of awareness. Some tour operators give options to their clients while others just group them together to get the best out of a deal. As argued earlier, access to places would rather be organically developed or planned with the conservation of nature in mind. And the impacts of transportation on the environment have been an issue through the years (Shukla, 2015).

The reality that there has been an increasing demand for natural areas as destination sites, whereas there has been a marked decline in the quality and quantity of natural areas due to the increase in tourism. Analyses of tourism movement shows that it is based on the concept of seasonality: preferred climates, location, and schedules of activities such as festivals and the like (Burns and Associates, 1989).

3.0 THE TOURISM POTENTIALS OF NIGERIATourism contributions or impact spans through employment creation, poverty reduction, infrastructure investment and development, among so many others. According to the WTO, tourism supports some 7% of the world workers. It can generate jobs directly through hotels, restaurants, night clubs, taxis and souvenir sales and indirectly through the supply of goods and services needed by tourism-related businesses. For example, hotel accommodation sector alone provided 11.3 million jobs worldwide in 1995.

In the Gambia, 30% of the workforce is tourism-dependent; in Maldives, it is 83%, 21% in Seychelles and 34% in Jamaica according to the WTO. The WTO further argues that “as a labor-intensive industry, tourism has the potential to create more jobs per unit of investment than any other industry and that it can be useful source of employment for women and ethnic minority groups. With its enormous economic power and high potential for employment creation, its capacity to spread its socio-economic benefits to all levels of society and to all parts of developing and least developed, tourism can be a leading sector in the fight against poverty. This further becomes a tool for the realization of the Sustainable Development Goals (SDGs) on poverty reduction.

Nigeria, presumably the giant of Africa

is richly endowed with so much in human, material and natural resources which if properly harnessed stand tall in repositioning the country (Obeta, and Onah, 2013). Nigeria can take over the place of so many countries as a popular tourist destination if her vastly scattered natural endowments are properly harnessed for social and economic benefits. Nigeria ranks among the most privileged nations of the world in terms of endowment of natural attractions. These natural endowments are scattered (in most cases untapped and unexploited) in every length and breadth of the country.

The list could be endless or beyond the following:

• The Yankari Game Reserve, in Bauchi which is a premier game reserve in Nigeria. • The Mambilla Plateau in the South East corner of Taraba state, mainly a very high grassland Plateau.• The Kainji National park in Kwara state which incorporates Borgu and Zugurma Game Reserves and the Jos wildlife Safari Park.• Numerous Beaches like the Lekki, the Bar, Eko, Badagry coconut Calabar beaches etc.• The Agbokim Water Fall in Cross River state, among others.• The popular Obudu Cattle Ranch which has metamorphosed to the new world class tourist centre,• Caves like the Ogbunike and Ajalli • Lakes like the Agulu and Uguta.• Museums like the War Museum at Umuahia, the Nri Museum already taken over by the University of Ibadan as one of its research centres which attracts a number of foreign researchers/tourists yearly, the Igbo- Ukwu Museum, the National Museum at Lagos, the Esie museum in Kwara State • The Tinapa tourist/business centre, and a host of others (Obeta, and Onah, 2013)The above represent more of the class of the Eco-tourism centres in the country. Beside them exist other numerous attraction centres involving more of artworks in the area of wood and ivory carvings, brass & bronze castings, grass and clothe weavings, pottery, painting, glass and metal works etc. For instance, there are the Ife and Benin brass and bronze castings, the grass weavings in northern parts of the country for making grass baskets, fans, tables and floor mats and also the legendary Akwete clothe weaving in Abia state, The Aso Oke weaving at Iseyin in Oyo


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state and the Ebira weaving at Okene, Kogi state. Nigeria is also blessed with popular sites of wood carvings in Benin and Awka areas and the pottery making centres in Suleja, Niger state and Okigwe, Imo state. Nigeria’s tourism resources further cover the range of the hospitality industry like hotels and other similar places of leisure and relaxation. There are world class standard 5-star hotels like the Protea, Nicon Noga, Hilton etc and other lesser class hotels which serve as prized places of visit and stay by local and international tourists. There are equally other numerous religious and cultural tourist centres in the country. Indeed, Nigeria is a tourist haven whose resources are still under explored, under-utilized and under exploited (Obeta, and Onah, 2013).

4.0 ACCESSIBLITY AND TOURISM DESTINATIONSAccording to Lamb and Davidson (1996), transportation is crucial in the tourism industry, as it connects supply (production) and demand (market) directly. The role of transportation in tourism is essentially to provide accessibility. It has been widely claimed by many scholars that without accessibility, tourism simply cannot take place (Chew 1987, Prideaux 2000). Accessibility is not only defined as providing ability to tourists to reach destinations, but also by the use of transportation services at destinations once they arrive. These accessibility factors influence tourists’ impressions during their trip, and serve as determining factors of the destinations’ overall attractiveness (Le-Klähn and Hall 2015, Page and Connell 2014, Boopen 2005, Naudé and Saayman 2005, Gunn and Var 2002, Chew 1987, Robinson 1976).

Della Corte, Piras, and Zamparelli (2010) devised a complex scheme to assess the attractiveness of tourist destinations, termed the “Six A’s”, as follows: (i) Accessibility of the destination; (ii) Attractions, defined as the local sights that attract demand; (iii) Accommodation structures; (iv) Amenities, or the services available at the destination (restaurants, theaters, etc.); (v) Assemblage, or the activity of tour operators/local actors to generate complex offers; and (vi) Ancillary services, which include the activities of incoming agencies, local institutes, and supporting organizations. Among these factors, accessibility is stressed as the fundamental element that determines the destination’s position in the market.

The role of transportation in tourism Litman (2008) elaborated on 12 transportation factors that effect a destination’s accessibility, specifically: (i) Transportation modes – quality

of transportation options, such as with respect to speed, comfort, and safety;

(ii) Transportation network connectivity – density of link and path connections, or directness of travel between destinations;

(iii) Travel cost or affordability; (iv) Mobility – travel speed and

distance, capacity, or travel time; (v) Integration of the links and modes

within the transportation system; (vi) Transportation demand; (vii) User information – availability

of reliable information on mobility and accessibility options; (viii) Mobility substitutes – telecommunications and delivery service substitutes for physical travel;

(ix) Transportation management; (x) Land use factors; (xi) Prioritization of travel activities;

and (xii) The value of inaccessibility or

isolation. Improving these accessibility factors can contribute to the economic success of a tourist destination (Currie and Falconer 2014, Celata 2007). New modes of transportation have revolutionized the tourism industry by improving distance-travel capabilities, travel speed, travel time, and comfort level. The introduction of railway laid the foundation for modern tourism, followed by the revolution of the automobile, which changed the style of regional and inter-regional tourism. International tourism was made possible soon thereafter by innovations in long-haul air transportation, which allowed for tourism in previously unreachable destinations (Chew 1987).

While energy-intensive forms of motorized transportation are preferred for long-haul travel because they save so much time, riding bicycles or walking at the destination can provide tourists with the on-site experiences they desire, such as relaxation or adventure (Millonig and Schechtner 2006, Lumsdon 2000). Cruise ships and ferries, categorized as modes of water transportation, have not only recovered the travel demand at the end of 20th century and into the 2000s (Davenport and Davenport 2006, Zapata-Aguirre and Brida 2008), but have also become tourist destinations in their own right and formed tourism destinations in some cases (Tang and

Jang 2010, Hanh 2006).

In general, a tourist destination’s accessibility can also be improved by developing the transportation infrastructure network or by improving connectivity between the network and tourist facilities. For example, the distance from a tourist’s place of origin to the desired destination can be reduced by adding a direct link between the two locations within the transportation network. Activities that widen links, or providing well-organized taxi connections for tourists near central bus or train stations can also improve connectivity between the transportation network and accommodations (Rietveld and Bruinsma 1998, Litman 2008). In some exceptions, improving transportation infrastructure may reduce accessibility. For example, in congested conditions, adding a new link or improving an existing link may increase average transportation costs, due to the potential differences between users’ equilibrium and the transportation system’s optimum state (termed "Paradox"; Sheffi 1985).

5.0 TRAVEL COST AND TOURISM DESTINATIONSCost is a major consideration determining the demand for a destination. It generally includes two elements: the cost of travel; and the cost of living and other services at the destination (Martin and Witt 1987, Martin and Witt 1988, Bimonte, Ferrini, and Grilli 2015). For tourists, the time they spend traveling represents one portion of the total cost. The time cost varies according to their value of time (Pagliara et al. 2015); i.e., travel costs include the actual amount of money they pay for the transportation service and the cost in terms of their travel time. Travel cost savings result from accessibility improvements. The enhanced quality of related tourism services – specifically, communication and information, booking procedures, restaurants, accommodation, and related transportation services etc. – can not only improve the accessibility of the destination, but can also affect tourists’ preferences. Many studies have shown the importance of travel-related services in tourism.

For example, Rheims, Bazin, Beckerich, and Delaplace (2011) stated that the lack of luxury hotels at a destination poses a problem, as business travelers require this type of accommodation. They also noted that limited restaurant services


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on the weekends can be problematic for the tourism industry. One service practice utilized in the Bahamas, called the “One-stop online booking and Immigration Card”, allows tourists to book and change their reservations online, and interact with their travel companions via email in real time. The Immigration Card, which holds travelers’ information, was designed and produced by the government of the Bahamas to improve security and simplify procedures for tourists. This service improved accessibility and attracted more tourists to the Bahamas (Wignaraja, Lezama, and Joiner 2004).

CONCLUSIONThe impact of transportation improvements on tourism may be different for different types of travelers, depending on the role of the link to the destination. This phenomenon can be addressed by integrating management measures into well-designed networks to reduce total travel time.

ReferencesBimonte, Salvatore, Silvia Ferrini, and Gaetano Grilli. 2015. “Transport Infrastructures, Environment Impacts and Tourists’ Welfare: A Choice Experiment to Elicit Tourist Preferences in Siena–Italy.” Journal of Environmental Planning and Management 0 (0): 1–20.

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Celata, Filippo. 2007. “Geographic Marginality, Transport Accessibility and Tourism Development.” Celant, A.: Global Tourism and Regional Competitiveness, Bologna, Patron, 37–46. Chew 1987,

Charles E. Obeta, and J. O. Onah (2013) Assessing Tourism Potentials for Rebranding Nigeria, Journal of Business and Management (IOSR-JBM) e-ISSN: 2278-487X.Volume 8, Issue 6, 30-36

Chew, Joseph. 1987. “Transport and Tourism in the Year 2000.” Tourism Management 8 (2): 83–85.

Coleman, C. (1997) Tourist traffic in English National Parks---An innovative approach to management, The Journal of Tourism Studies, Vol.8, No.1, 2-15.

Culpan, R. (1987) International tourism model for developing economies, Annals of Tourism Research, Vol. 14, 541-552

Currie, Christine, and Peter Falconer. 2014. “Maintaining Sustainable Island Destinations in Scotland: The Role of the Transport–tourism Relationship.” Journal of Destination Marketing & Management, TRANSPORT AND DESTINATION MANAGEMENT, 3 (3): 162–72.

Davenport, John, and Julia L. Davenport. 2006. “The Impact of Tourism and Personal Leisure Transport on Coastal Environments: A Review.” Estuarine, Coastal and Shelf Science 67 (1–2): 280–92.

Della Corte, Valentina, Alessio Piras, and Giuseppina Zamparelli. 2010. “Brand and Image: The Strategic Factors in Destination Marketing.” International Journal of Leisure and Tourism Marketing 1 (4): 358–77

G. N. Okeudo, W. Ikenna and E. A. Ejem (2009). Issues in the Development of Ferry Services as a Critical Commuter Transportation System: A Case Study of Lagos-Nigeria. The International Journal of Development Studies. Vol. 6, No. 1, 8-20.

Gunn, Clare A., and Turgut Var. 2002. Tourism Planning: Basics, Concepts, Cases. Psychology Press.

Hanh, Vu Thi Hong. 2006. “Canal-Side Highway in Ho Chi Minh City (HCMC), Vietnam – Issues of Urban Cultural Conservation and Tourism Development.” GeoJournal 66 (3)

Honey, M. (1999) Ecotourism and sustainable development: Who owns paradise? Island Press, Washington DC.

Inskeep, E. (1987) Environmental planning for tourism, Annals of Tourism Research, Vol. 14, 118-135.

Lamb, Barbara, and Sally Davidson. 1996. “Tourism and Transportation in Ontario, Canada: A Vital Link.” In Practicing Responsible Tourism: International Case Studies in Tourism Planning, Policy and Development. John Wiley and Sons.

Le-Klähn, Diem-Trinh, and C. Michael Hall. 2015. “Tourist Use of Public Transport at Destinations – a Review.” Current Issues in Tourism 18 (8): 785–803.

Litman, Todd. 2008. “Evaluating Accessibility for Transportation Planning,” March. http://trid.trb.org/view.aspx?id=859513.

Lumsdon, Les. 2000. “Transport and Tourism: Cycle Tourism – A Model for Sustainable Development?” Journal of Sustainable Tourism 8 (5): 361–77.

Martin, Christine A., and Stephen F. Witt. 1987. “Tourism Demand Forecasting Models: Choice of Appropriate Variable to Represent Tourists’ Cost of Living.” Tourism Management 8 (3): 233–46. Martin and Witt 1988,“Substitute Prices in Models of Tourism Demand.” Annals of Tourism Research 15 (2): 255–68

Millonig, A., and K. Schechtner. 2006. “City Tourism: Pedestrian Orientation Behaviour.” INTERNATIONAL CONFERENCE ON WALKING AND LIVEABLE COMMUNITIES, 7TH, 2006, MELBOURNE, VICTORIA, AUSTRALIA, Naudé, Willem A., and Andrea Saayman. 2005. “Determinants of Tourist Arrivals in Africa: A Panel Data Regression Analysis.” Tourism Economics 11 (3): 365–91.

Nguyen Van Truonga , Tetsuo Shimizub (2016), The effect of transportation on tourism promotion: Literature review on application of the Computable General Equilibrium (CGE) Model. World Conference on Transport Research - WCTR 2016 Shanghai. 10-15 July 2016.

Page, Stephen. 2009. Transport and Tourism: Global Perspectives. Harlow: Pearson Prentice Hall.

Page, Stephen, and Joanne Connell. 2014. “Transport and Tourism.” In The Wiley Blackwell Companion to Tourism, edited by Alan A. Lew, C. Michael Hall, and Allan M. Williams, 155–67. John Wiley & Sons, Ltd.

Pagliara, Francesca, Andrea La Pietra, Juan Gomez, and José Manuel Vassallo. 2015. “High Speed Rail and the Tourism Market: Evidence from the Madrid Case Study.” Transport Policy 37 (January): 187–94 Palhares, Guilherme Lohmann. 2003.


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“The Role of Transport in Tourism Development: Nodal Functions and Management Practices.” International Journal of Tourism Research 5 (5): 403–7

Prideaux, Bruce. 2000a. “The Role of the Transport System in Destination Development.” Tourism Management 21 (1): 53–63.

Rheims, Bazin, Sylvie, Christophe Beckerich, and Marie Delaplace. 2011. “High Speed Railway, Service Innovations and Urban and Business Tourisms Development.” SARMENTO M. & MATIAS A.“Tourism Economics and Management: The State of the Art”, Springer Verlag.

Rietveld, Professor Dr Piet, and Dr Frank Bruinsma. 1998. “Concepts and Data.” In Is Transport Infrastructure Effective? Transport Infrastructure and Accessibility: Impacts on the Space

Economy, 17–45. Advances in Spatial Science. Springer Berlin Heidelberg.

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Shivam Shukla (2015), Role & Contribution of Airlines towards Tourism Promotion in India. Ph.D Thesis Submitted to Department of Management And Commerce Faculty Of Management And Humanities Jayoti Vidyapeeth Women’s University, Jaipur (Rajasthan), India.Tang, Liang, and Soocheong Jang. 2010. “The Evolution from Transportation to

Tourism: The Case of the New York Canal System.” Tourism Geographies 12 (3): 435–59. doi:10.1080/14616688.2010.494683

Wignaraja, Ganeshan, Marlon Lezama, and David Joiner. 2004. Small States in Transition: From Vulnerability to Competitiveness. Commonwealth secretariat.

Zapata-Aguirre, Sandra, and Juan Gabriel Brida. 2008. “The Impacts of the Cruise Industry on Tourism Destinations.” SUSTAINABLE TOURISM AS A FACTOR OF LOCAL DEVELOPMENT, V. Castellani and S. Sala, Eds., Tangram Edizioni Scientifiche (Colla).


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By: Gbenga Adeseye FAKOYA

Logistics Outlook

Modern organizations utilize various means to remain competitive, survive and

thrive in a dynamic and hostile business environment. One of such is acquiring customer feed-back with a view to improving the quality of service delivery. Customer feed-back is however beyond obtaining information from clients/customers (in this case –Passengers) about a service they have received, it relates to a deliberate attempt to understand the customer’s feeling after every service rendered. This is an important marketing strategy which transcends the conventional asking of questions and filling out questionnaires which most organizations employ; although this act is a step in obtaining information from clients/customers, it is not an all-encompassing customer feedback process as it is only a singular event out of a string of events an organization can adopt while trying to obtain customers’ post service feel.

In the contemporary business environment, every service rendered by a firm comes with either a post service consonance or dissonance from a customer. A customer feels a post service dissonance if the actual utility derived is deviated from their perceived utility or expected desire from that service. When this happens, the customer begins

to feel they should have engaged the services of an alternate provider instead of a particular provider. At this point, the customer is beginning to attain the culmination of service dissatisfaction and the service provider runs a risk of losing such customer to competitors. Even though it may seem the firm isn’t losing the customer in the short run, this only happens where the current market is not a perfect market. In a perfect market where competition is intense, a customer has the liberty to switch in an attempt to quench the thirst of their dissatisfaction. Although this situation is healthy in a perfectly competitive market, it has a potential to impact on the profitability of that individual firm. A firm which has not been able to instil adequate trust its customers which is required to survive in a competitive business environment may fall short in the long run. In order to assuage the burgeoning threats a firm faces in a competitive market, there are various strategies available. One of such is by creating what is called Brand Loyalty.

Brand Loyalty is created over a period of time; when a firm consistently meets its customers’ expectations by offering services which competitors/potential competitors do not offer. It consists of obtaining customers’ post service feel after every service delivery and seeking

ways to alwaysimprove on previous performances from those who have bought/used that service. An organization which seeks continuous service improvement devices measures to maintain a particular service quality level, improve upon it or totally discontinue and create a new type of service quality (depending on the level of satisfaction/dissatisfaction recorded by customers)

There are various ways of creating brand loyalty; one of such ways is through creating what is known as ‘Customer Emotional Attachment’ to the firm’s services/products.

Creating Customer Emotional AttachmentThere are a number of ways an organization/business can attract a customer’s emotion. A simple act of kindness; a smiling face on the front desk (a Bus Captain behind the wheels); a polite and humble response to a customer’s request (Ticket Staff) , are ways a firm can create customer emotional attachment to its brand. This singular strategy makes brand switching particularly difficult. It enhances customer loyalty.

Sustaining the BRT Brand Through Service Improvement


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Dissuade Bus Captains/Ticket officers’ Emotional outburstThis is a direct opposite of the point made above. As much as the company thrives to create customer emotional attachment to her brand, she should discourage ticket staff and bus captains’ emotional outbursts towards passengers. It is generally agreed that passengers could be sometimes irrational and therefore can constitute a great deal of annoyance towards the Captains/Ticket officers, a huge difference can be drawn by mentally swapping positions before responding. Questions like ‘what if I am the passenger on another bus, would I appreciate being addressed in this manner?’ should quickly come to mind. An enormous amount of respect can be earned merely by the way a Captain/Ticket officer responds to a situation which will no doubt cascade into positive points for the organization as a whole. Should the case be reverse, the same will definitely rub off on the whole organization.

Another way of creating brand loyalty is by allowing negotiations and creation of a distinctive payment system, especially for special circumstances.

Allowing negotiations/creating a distinctive payment system

Different organizations have characteristic payment systems peculiar to them. The BRT structure has one of the most professional bus Ticket purchase systems, but the need has arisen to adopt a more robust system which includes not just ticket purchase, but balance re-imbursement known in the common parlance as ‘Change’. Majority of the problems encountered by passengers and ticketing officers on the BRT system emanates from this singular factor, especially for passengers who do not terminate their travel at a loading bay. Although it may seem a trivial issue, it has a potential of escalating into a complex situation where a passenger’s overall satisfaction is affected.

Every organization must understand that the business world is gradually moving away from the production and sales orientation into the marketing orientation. Modern Organizations no longer concentrate their efforts on production efficiency alone, but now embrace the marketing orientation which focuses mainly on customer satisfaction. The assumption that as long

as the service is provided (in this case, getting passengers to their destination) it will offer solutions to the organization’s sustainability needs/goals, therefore customers’ needs can be treated as secondary has been refuted by the continuous lack of customer loyalty such firms experience. This belief is erroneous and capable of devastating a firm when market competition becomes intense.

In order to remain the leader in the emerging market of mass commuter transport in Nigeria and in extension - West Africa, the BRT system must remain ‘Customercentric’. She must understand that the heart of her business operation holds and should centre on treating and responding to her passengers ethically and professionally at all times. Her customers must see her as a brand which focuses on understanding and satisfying their needs every given time. Lagos BRT employees at all levels must make their customers King while they allow Top Management concentrate on the strategy to continue making the business a profitable one. This way, every one returns with a smile and a win-win situation is achieved for both company and customers.


Logistics Outlook


Logistics Outlook


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