• Sat. Jul 31st, 2021

Special focus on five years of private terminal concession in Nigerian ports

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  • Special focus on five years of private terminal concession in Nigerian ports

The port concession programme began effectively in 2006 after the international competitive bidding which produced the successful terminal operators now holding sway at most Nigerian seaports. At the Roll-on-Roll-off terminal in Tin Can Island port at Apapa Lagos, Fivestar Logistics Ltd (FSL) won the bid to run the facility as a privatized terminal for 15 years beginning in April 2006. Many things have since changed at this facility as with most other terminals handed over to private concessionaires. Throughput has increased. Security of goods under storage has been enhanced and consolidated. Foreign shipping lines like MOL and K line which left the country for neighbouring ports have since returned to Nigerian ports while some new container shipping lines are now calling Nigeria like CSAV, Nile Dutch, UASC. This is another clear signal that change has happened to the international perception of the situation of things at the ports.

Similarly, revenue generation, at FSL has increased significantly for all stakeholders, especially since the concessionaire developed and maximized available land spaces that were previously left fallow or consigned to uneconomic uses. Employment generation has been upped from the previous situation and the semblance of growth and modernity has become discernible in an area that was known in the old dispensation as a den of wharf rats and a society of discredited stevedores. Yet some challenges still abound.

A week before the interview with the terminal manager of FSL, Capt Jon Jon Peters, the federal government had announced that of all the coterie of assorted security agencies working in seaports around the country, only four, some say six, are now allowed to maintain presence and inspect goods passing through the national gateways. The issue of too many government agencies at the ports was a longstanding point of contact for delays in goods clearance at Nigerian ports. Capt Jon Jon revealed that while this was a welcomed announcement, all practiced eyes at the sector were watching to see if it would materialize this time around. Previous announcements by past regimes concerning the same issue went unheeded and the agencies managed to find raison d’etre to continue to put boots right on ground at the quays. With a few days to the end of the two-week deadline given by the Dr Ngozi Okonjo Iweala, Finance Minister and Coordinating Minister for the Economy-led team that included the Honourable Minister of Transport, Senator Idris Husseni, the word is mum at the ports.

Incidentally, other revelations are coming on the heels of closer examination of the workings of multiple agencies at the ports. It has emerged that the Nigerian Customs Service (NCS) is represented by not less than three arms regulating customs at most Nigerian ports, including Customs Enforcement Unit, Federal Operations Unit and others. Are these different or parallel units of NCS or do they work in tandem? Again, do all three have to carry out two, three or more separate checks on cargoes before release or are they represented by just one arm? If there are multiple units of NCS at the ports, this may be contributing to the various notions of how many agencies are still left to operate at the ports. So that whereas many Nigerians believe that only four agencies have been left to operate at the ports, if a multiple representation by parallel customs bodies are added up, Nigerian seaports are still brimming with not less than six or eight agencies left to continue the harangue with importers and exporters – a number that is obviously less than the bargain announced by the ministers for expedited goods clearance.

Secondly, it has now become apparent that congestion at the Lagos ports will not disappear soon. One of the principal reasons for this is the unrelated application to which adjoining land acreages around the port has been put in times past. A school of thought represented by the views of Capt Jon Jon has pointed out the futility of citing a secondary school in the general surroundings and very close to Tin Can Island port, just across the small lagoon from the port. Or even the location of a petroleum tank farm adjacent to port grounds! This, aside from industrial safety complications compromises economic usage of what could have been prime storage space for imports or exports. Locating storage spaces within port grounds have the added advantage of distribution traffic (lorries, trucks, etc) from spilling onto public highways. But now, in the absence of such good planning, the inner roads of Tin Can Island and Apapa ports and the Apapa-Oshodi expressway are clogged daily with articulated trucks of various descriptions conveying laden and empty containers to and from many off-dock storage grounds and giving rise to the unending loathsome traffic jams now associated with Apapa in general.

Another challenge for Tin Can Island port terminal operators is the lethargic repair of the inner port roads which results in very unsightly scenes where lorries litter the thoroughfares and even some quay areas. That the situation has lasted for many years is a sad commentary on the competence of NPA as a landlord. Even as at press time, the repair work at the inner roads at Tin Can Island port is a sorry sight revealing only a scattered struggle. At Port Harcourt port, the same story of neglect dogs its access roads. It’s a national shame that the golden goose has been paid only lip service by politicians, resulting in handicap and, therefore, a drawback to Nigeria’s chances of realizing its natural position as a successful maritime hub for the sub-region.

Or, is it not shameful that after more than thirty years of charging port users the 2% National Automotive Council Levy and 7% port levy, among other levies, the authorities, and especially NPA management, cannot find it in their schedule to insist on properly developing, equipping and positioning ports nationwide? The worst aspect of the puzzle for the Nigerian ports industry is that with the Lagos ports complex adjudged the busiest and most lucrative in the country, an affliction of logistic problems like the ones enumerated above ought to instigate a flurry of measures by the federal ministry of transport to untangle the web of clutter, but this is not happening. Instead the news is handy about ministerial visits to Antwerp, Singapore, Malaysia, China and other developed places, ostensibly to visit their port infrastructures – visits many in the inner circle and even some of the hosts might know, were nothing but gambits for, sometimes, as paltry as estacode allowances and similar perks. Because, in all reality, what is so gargantuan and impossible about managing the Lagos ports complex, for example, in such a way that their activities do not impose a commuter’s nightmare to the average visitor to the port city of Apapa? Rather, the roads of Apapa and environs, up to Mile 2, are now so unpredictable that many will go there only if they run out of options. And this unfortunate situation threatens to suffocate the gains being made in the port concession programme.

A third challenge to the gains of the port concession agenda is the hiccups presented by one of the remaining bureaucracies in Nigeria’s port industry, namely, pilotage. A ship comes calling and the time it spends waiting for a pilot is equal to the time of total operation, loading and unloading. All the concessionaires have the same stories of woe to tell about the performance of pilots charged with taking in ships to berth and taking them out to the fairway buoy for their departure. Ships have been known to wait for pilots for upwards of four to six hours – a scenario that would hardly obtain if the service were deregulated so that pilotage firms compete for service provision to the industry. A situation where the shipping line has no choice but to depend on NPA to provide the pilot without recourse to any other options gives way for lethargy and could even encourage bribery and corruption. On the question of solutions, opinions vary. While Capt Jon Jon prefers privatization, Danny Fuchs of Lagos Channel Management strongly argues against it. (His interview is in another section of this edition.) But the answer must lie somewhere in between.