Transport problems are costing Nigeria big money

Nigeria's transportation challenges are costing the economy far more than many people may realise. According to a report by Punch, the country loses more than ₦3.6tn to inefficiencies and distortions in its transportation and logistics sector. The estimate was given by Dr Obiora Madu, Director-General of the Africa Centre for Supply Chain, who warned that poor connections across the transport network are making business operations more difficult, particularly for small businesses.

The figure highlights the scale of Nigeria logistics losses and shows why improving the movement of goods is an important economic issue. Transport is not just about getting passengers from one place to another. It also determines how quickly food, building materials, medicines, fuel and other products reach the people who need them.

HOW BIG IS THE ₦3.6TN LOSS?

More than ₦3.6tn is a huge amount, but its meaning becomes clearer when connected to everyday activities. Imagine a trader waiting for a delivery of rice, a manufacturer expecting raw materials or a shop owner trying to restock products. When transportation takes longer or costs more than expected, each business faces additional expenses.

These problems can occur at different stages of the supply chain, including moving goods from farms to warehouses, transporting them to markets and delivering imported products from ports to their destinations.

The estimate reported by Punch reflects losses associated with inefficiencies and distortions across the transportation and logistics sector. It should not be understood as a direct bill paid by one company or as money that has been collected by the government. Rather, it represents the economic cost of a transport system that does not move goods as efficiently as it should.

HOW BAD ROADS AND DELAYS HURT BUSINESSES

Poor road conditions, congestion and weak connections between different transport systems can make deliveries unpredictable. A truck carrying goods may spend longer than expected on a journey, while businesses may have to deal with additional fuel, vehicle maintenance and operating expenses.

Delays can also affect small businesses more severely. Large companies may have more resources to absorb unexpected costs, but a small distributor or retailer often works with limited capital. When goods arrive late, the business may lose customers, miss sales opportunities or struggle to maintain its usual supply.

Transport costs Nigeria businesses face are also influenced by how easily road, rail, maritime and air services connect. Punch reported that Nigerian Railway Corporation Managing Director Dr Kayode Opeifa called for better integration of these transport modes. Rail, for example, can move large quantities of goods over long distances, while roads remain important for collecting cargo and completing deliveries to shops and customers.

WHY ORDINARY PEOPLE FEEL THE EFFECT

Transport expenses do not always remain with the companies that pay them. Businesses often consider the cost of moving goods when deciding the prices they charge customers.

For example, if a food distributor spends more money transporting products from a wholesale market to a local shop, that extra expense can influence the final selling price. The same problem can affect clothing, household supplies, construction materials and other everyday products.

This is how transport problems can contribute to higher prices and place additional pressure on household budgets. The relationship is not automatic, because prices are also influenced by production costs, exchange rates, taxes and market conditions. However, inefficient transportation adds another burden to the supply chain.

These challenges show why prices and supply chain Nigeria consumers experience are closely connected to the country's transport system.

THE NEED FOR A CONNECTED TRANSPORT SYSTEM

Industry stakeholders have called for better coordination between road, rail, maritime and air transportation. Improving individual roads or railway lines is useful, but the wider system also needs to work together.

A shipment arriving at a seaport, for instance, should be able to move efficiently to rail facilities, warehouses and distribution centres. Better connections could reduce unnecessary waiting, improve delivery schedules and help businesses plan their operations.

For ordinary Nigerians, the real benefit would be a more reliable movement of goods and fewer avoidable expenses along the way. Addressing transport inefficiencies will require sustained investment, better coordination and practical improvements that reach businesses and communities.

The ₦3.6tn estimate is a reminder that transportation problems affect much more than vehicles and roads. They influence business performance, the availability of products and the prices people encounter in their daily lives.