Poor infrastructure threatening Nigeria’s economic stability, experts warn

Monday, September 15, 2025 - A critical shortage in logistics infrastructure is fueling high costs and threatening Nigeria’s economic stability, according to industry experts who gathered at the inaugural supply chain conference organised by the African Centre for Supply Chain (ACSC) in Lagos. With the theme: “The Supply Chain of Now: Technology, Sustainability and Social Impact,” the conference highlighted the urgent need for a radical overhaul of the country’s logistics system to unlock its full economic potential.

The conference’s findings were reinforced by a new World Bank report, “Transport Connectivity for Food Security in Africa,” which paints a stark picture of the continent’s logistics crisis. According to the report, inefficient logistics and poor storage have resulted in the loss of up to 40 per cent of fruits and vegetables in Sub-Saharan Africa. It noted that, on average, food travels more than 4,000 kilometers and takes 23 days to reach consumers across Africa, a journey that is four times longer than in Europe.

Director-General, African Centre for Supply Chain (ACSC) Dr. Obiora Madu, warned that the current infrastructure deficits are killing businesses and hindering the nation’s economic competitiveness. He lamented the lack of both “hard” infrastructure, such as functional railways, and “soft” infrastructure, such as robust data and policy frameworks.

A glaring example of this physical deficit, he noted, is the frequent train derailments that disrupt the movement of goods. Madu also pointed to a significant data gap, stating: “We don’t even know what portion of our gross domestic product (GDP) is made up of logistics,” which makes it difficult to formulate effective policies.

The fragmentation of government ministries and the proliferation of agencies are worsening the situation, Madu argued, as they hinder the crucial collaboration needed for a cohesive logistics strategy. While technology offers solutions, he cautioned against seeing artificial intelligence as a panacea. “You don’t automate an empty space. You have to have a process to automate,” he said, emphasising that a solid foundation must be in place before advanced technology can be effectively applied.

According to him, Nigeria has strong potential to become a regional logistics hub. A large coastline, deep-water ports, international airports, and a fast-growing manufacturing and e-commerce economy provide significant advantages. Despite these strengths, he noted that logistics costs remain high.

The President, Chartered Institute of Logistics and Transport (CILT), Barrister Mfon Usoro, believes Nigeria’s logistics sector is on the cusp of a transformation. She noted that a growing awareness of the sector’s importance is taking hold.

Mrs Usoro stressed that a “full government approach” is crucial, stating: “If you ignore this path, you cannot have the agricultural revolution that the government plans to. You cannot have the revolution in manufacturing because all of it has at the centre the supply chain.”

She pointed to positive developments, including the creation of a transport cadre within the civil service and a new Memorandum of Understanding with the Bureau for Public Procurement (BPP) to integrate supply chain management into federal government procurement. The establishment of university departments for logistics is also a welcome step, though she stressed the need for more skilled lecturers to train the next generation of professionals.

Flour Mills of Nigeria Plc (FMN) Group Director of Supply Chain, Cephas Afebuameh, urged logistics professionals to anchor their work on the principles of “people, planet, and profitability” to ensure long-term economic impact. He emphasised that green logistics is no longer simply a trend but a prerequisite for companies seeking deeper integration into global supply chains.

He noted that by adopting green logistics, businesses can expand their customer base, increase revenue, reduce costs, and strengthen competitiveness in the long term.

Treasurer and board member of the International Chamber of Commerce (ICC), Dr. Omolara Akanji, advised practitioners to deploy data to navigate global tariff complexities. With evolving trade dynamics, she noted that businesses across the country must design strategies to enhance local manufacturing and reduce reliance on external suppliers. As trade partnerships expand across Africa, she observed that the continent is projected to see significant growth in international trade.

Senior Manager, Facilities, GSSC, MTN, Olufunmilayo Jegede, said the organisation has increased support to improve smooth logistics operations of businesses across the country through its activities.

Prof. Frank Ojadi, a distinguished authority on operations management at Lagos Business School (LBS), issued a critical call to action for professionals to map and understand their supply chains to stay competitive. He stressed that in the current turbulent operating environment, such strategic exercises are not a luxury but a fundamental requirement for survival and growth.

Ojadi highlighted that companies often fail to appreciate the intricate web of dependencies that make up their supply chains, adding that a lack of careful planning and anticipation leaves them vulnerable to disruptions, from infrastructure deficits and policy inconsistencies to security challenges. He emphasised that businesses that proactively identify potential bottlenecks and craft mitigation strategies are the ones that will thrive.

His words: “Firms must constantly evaluate their processes to ensure they can withstand shocks. This includes a deep dive into sourcing, production, and distribution channels to pinpoint weak spots and implement robust contingency plans.”