Despite possessing the largest oil and gas reserves in Africa and the sixth largest globally, Nigeria is charting a course beyond hydrocarbons. In this interview with PAUL OGBUOKIRI, the Managing Director of Lekki Port LFTZ Enterprise Limited, Mr. Wang Qiang, speaks on this development and urges policymakers to replicate the Lekki Port model nationwide and be seen as a national blueprint for leveraging the blue economy to create jobs, attract investment, and build a more sustainable future for Nigeria. Excerpts
A lot has been reported about the capacities of the Lekki Deep Seaport. Can you confirm that this port is capable of changing the narrative about the Nigerian port industry?
The Lekki Deep Sea Port is Nigeria’s first fully automated deep-water facility, equipped with cutting-edge ship-to-shore super-post Panamax cranes and advanced scanning technology. Built at a cost of approximately $1.6 billion, the port was developed by the China Harbour Engineering Company as part of Beijing’s Belt and Road Initiative.
The port’s ownership structure reflects international collaboration, with China Harbour Engineering Company and Singapore’s Tolaram Group holding a 75% stake, while the Lagos State Government and the Nigerian Ports Authority share the remaining 25%. Covering 90 hectares within the Lagos Free Zone, the port is managed by Lekki Free Port Terminal (LFT) and officially began full-scale operations in April 2023.
What is the capacity and estimated economic impact of the port as it is set to reach optimal performance?
The port is designed to be built in three phases. Once fully completed, it will have an annual handling capacity of six million TEUs, up from its current 2.7 million TEUs. Additionally, it will include facilities dedicated to managing large volumes of liquid and dry bulk cargo. The dry cargo terminal is set to handle up to four million tons annually.
Vessels docking at Lekki can carry over 14,500 containers. This expansion alleviates pressure on Nigeria’s congested Port Harcourt and is projected to generate over $200 billion in revenue, positioning Lekki as a premier cargo hub in West Africa. On June 29, 2023, the port welcomed its first transshipment vessel, which carried cargo from two of the world’s leading shipping lines, CMA CGM and Maersk, with a route that included major ports in Asia and Africa.
Why do you consider this port a strategic investment by Nigeria, China, and other stakeholders?
China remains Nigeria’s largest bilateral lender, funding a variety of infrastructure projects including railways and highways. The Lekki Port itself involved an investment of $1.53 billion in fixed assets and $800 million in construction costs. Over 45 years, the port is projected to generate an astonishing $361 billion in economic output. The development aims to create 170,000 jobs, contributing $201 billion to federal and state revenues through taxes, duties, and royalties.
The port is expected to significantly impact the economy, reflecting a multiplier effect of about 230 times its construction cost. Moreover, it serves as a “playbook” for how Nigeria can translate ambitious policies into transformative projects that drive trade, industry, and sustainable growth within the blue economy.
Its project delivery under a public-private partnership (PPP) model illustrates the mobilization of private capital and expertise, complementing government policy while reducing pressure on public funds. Key factors underpinning the port’s success include a bankable structure, clear concession terms, and enforceable performance standards.
With its current draft of 16.5 meters, the port is equipped to receive some of the largest container vessels and features super post-Panamax cranes and automated systems to cut vessel waiting times, lower logistics costs, and enhance trade efficiency. Since commencing transshipment operations, Lekki Port has started to establish Nigeria as a regional trade hub under the African Continental Free Trade Agreement (AfCFTA), reclaiming maritime business previously lost to neighboring countries.
In specific terms, what is the economic impact of the completion of Lekki Port on the Nigerian economy?
The economic impact of this project is monumental. Once completed, it will invigorate economic activities within Ibeju Lekki, Lagos State, and across Nigeria. Studies project that the port will create around 170,000 direct and indirect jobs through port operations alone. Additionally, the port is expected to generate approximately $201 billion in revenue from taxes and duties over its operational lifespan.
Furthermore, over the term of the concession, the port has a projected direct and induced business revenue impact of $158 billion, significantly benefiting the manufacturing, trade, and commercial services sectors. Overall, Lekki Port is estimated to have an aggregate impact of about $361 billion on the Nigerian economy, enhancing the country’s GDP through a multiplier effect.
Lekki Port is coming at a time when users are accustomed to existing Apapa and Tin-Can Ports. What will you do differently to attract businesses and sustain patronage?
Lekki Port is intentionally designed to stand apart from existing ports. We have engaged experts, with construction being handled by CHELE, a subsidiary of China Harbour Engineering Company, recognized globally for its marine construction capabilities. Additionally, Louis Berger, part of WSP Group, serves as our project management consultants, ensuring we meet international standards in marine infrastructure.
Phase one includes a 1.5-meter quay and an unprecedented water depth of 16.5 meters. The port will be equipped with Rubber Tyre Gantry (RTGs) and Ship-to-Shore (STS) cranes to enhance operational efficiency. Built-in technology will allow for screening and processing, enabling the efficient movement of goods within a 48-hour window.
Moreover, being located within the Lagos Free Zone allows port users and investors to reap benefits tied to operating within a free zone under the NEPZA regime, adding to the attractiveness of Lekki Port.
What level of support are you receiving from the Lagos State Government and Nigerian Ports Authority for the required infrastructure?
Both the Lagos State and Federal Governments have identified Lekki Port as a transformative project. They have been actively involved, supporting our management team throughout the development process. Governor Sanwo-Olu has personally visited the port site and assured us that road infrastructure enhancements will be made before the start of operations. Additionally, the Minister of Transportation conducts quarterly inspections to provide insights and support in expediting our challenges.
We have also garnered ample support in securing the necessary technical approvals for our workforce. The cooperation we have received has been instrumental, and we are grateful for the unwavering engagement at the highest levels of government.
How has the funding for the Lekki Port project fared amidst Nigeria’s funding challenges?
We have been fortunate because critical negotiations for financing were completed long ago. For instance, our Facility Agreements with China Development Bank for a $629 million loan were signed in October 2019, alongside the established shareholding agreement between China Harbour and Tolaram Group.
Despite broader government funding challenges, all stakeholders remain aligned, focused on ensuring the project is completed efficiently, addressing any financial hurdles as they arise.
What challenges do you foresee as the port operations progress?
Since the establishment of a committee in May 2021 by the NPA’s Managing Director, we have proactively addressed operational challenges as they arise. Any project of this magnitude will undoubtedly face obstacles, but we are working diligently with our stakeholders to navigate these challenges as we transition through the phases of development.
The Lekki Port project embodies a collaborative approach to substantial infrastructure investment. As a public-private partnership initiative, it is a testament to the increasing trend of global collaboration to drive transformative infrastructure projects.