The former Executive Secretary, Nigerian Shippers Council (NSC), Barrister Hassan Bello, has said that port reform brought a lot of improvements for the port.
Bello said this while presenting the key paper at the 34th anniversary and awards ceremony of the Maritime Reporters Association of Nigeria (MARAN) in Lagos, recently.
Tagged MARAN@34, the former executive secretary in his paper entitled “The Pains and Gains of Port Concession,” went down memory lane to the history of port reform instituted in 2006 by the federal government necessitating the creation of 26 terminals out of the five existing port complexes in Lagos, Rivers, Calabar, Delta and Onne.
He said the gains include efficiency in port operation largely because of the private sector participation as well as increased port revenue.
He maintained that the reform was critical but not comprehensive and ran the risk of being derailed, curtailed, distorted or even reversed hugely because the legal framework was not dynamic and wholesome.
He was of the opinion that the reform was short of revolutionary; changing radically the dynamics of the port operation in Nigeria.
According to him, the impact was noticeable, almost palpable, relative to what was replaced.
Maintaining that the reform brought a lot of improvements for the port, he cited the increased cargo throughput following the port reform.
His words: “The National Ports Authority (NPA) generates N172.3 billion in the first half of 2022, remits N78.5 billion to the coffers of Nigeria.
“Within the NPA management, structural re-organisation was carried out with emphasis on increased contribution to the economy.
“Management also infused technology in port operation like the Electronic Ship Entry Notice, electronic call up system, etc.
“There is a shift of focus from import to also export (export terminals licensed) as well as access to the port – rail and barge operation.”
However, on the pains of the port reform of 2006, he observed that efficiency was not optimal as port operations were characterised by delays, inertia at high cost, transparency had been the watchword but there were still opaque areas in charges like rent charges, hidden, under the table payment still persist making doing business at the port difficult and costly.
Bello also observed that cargo clearance procedures was still primitive, tedious and comprised as the port was still being run as mostly a manual port even though some terminals were operating digitally, the port is still plagued by human contacts which is inimical to transparent port and delays of up to 21 days cargo dwell time which is very long a time.
Speaking on the gaps noticed, he opined that the port reform was timely and necessary but were not comprehensive and neglected issues like multi-modal access to the port namely: rail, road, inland waterways which according to him, had hampered quick delivery of cargo and had caused perennial congestion of the port and threatened to roll back the clock.
He further said that the government had not been able to match the private sector in improvement of critical infrastructure like rail and road, adding that access to the port for import and especially for export was hampered as well as the absence of clarity and inclusiveness in the regulatory and legal framework.
“The concessionary agreement was shrouded in secrecy. Critical stakeholders (demand side of shipping) were excluded with disastrous consequences.
“Little or no impact was sought from importers, exporters, freight forwarders etc.
“In 2019, NSC was appointed economic regulator but loosely bound regulations were not effective though NSC regulatory was noticeable and endorsed by the Judiciary, the government and even the operators.
“There seems, therefore, a lack of effort by the government to carry out structural reform in related sectors to enhance inland connectivity. There is no deliberate linkage or integration of transport infrastructure as ports were haphazardly cited without regard to logistics dynamism,” he stated.
Bello, however, recommended that the government must perform its part as a major driver of the reform adding that it must build and enhance critical transport infrastructure on which the port reform was anchored.
His submission: “Ports are not merely waterfront harbours. Ports and port operations transcend port limits and have greater influence on the economy.
“Those critical infrastructure must be deliberately sited to make for coordination, linkages and others, especially concerning the inland connectivity. Transport infrastructure cannot be located haphazardly, anyhow.
“Federal government must provide conducive operating procedure, ease and cost of doing business and fight debilitating corruption that threatens to put a break on reforms.”
He further insisted that port reform must be clothed in a dynamic, lucid and comprehensive legal and regulatory framework that is democratic and that provides clarity to the responsibilities and rights of the active parties.
Also; “the regulatory institutions must be assigned specific roles, unequivocal. Concessioning is give and take, the involvement of stakeholders is necessary not only in drafting agreements but in monitoring the tenets of the agreement.
“There should, therefore, be a review and enactment and guiding reform bills like the Ports and Harbours bill, the National Transport Commission bill, the Nigerian Railway bill, the National Inland Waterways Authority bill and others that have been abandoned at the National Assembly or at the Presidency.
But all these bills must be aligned and related. These bills must be assigned achievable, realizable objectives and must reflect a certain context of making the transport sector alternative to the oil (mono) economy.
“The transport sector must be concertedly looked at and positioned to wean Nigeria from oil and provide a diverse and more certain and sustainable economic sector. I recommend that a Presidential Committee be set up to take up this assignment in a short time.
“Critical government agencies should be headed by qualified managers, trained and competent, able to achieve set goals and meet with targets.
“Already, legislations setting up these agencies contain minimum qualifications which unfortunately, are ignored when making these appointments. The derogation of these appointments as political trophies have and will continue to cause havoc.”
Bello also recommended a crystallisation of the standard operating procedures with strict adherence and penalties for infractions adding that those internationally believed standards must be set and agreed by parties and enforced and operated upon.
“This would be the base and source of reliable statistics or data for progress and planning. There seems to be discretionary behavior and subjective standards which may not enhance regulatory agenda”, he opined.
Continuing, Bello said: “Strengthening the bargaining position and power of parties – more often than not, the consumers of shipping services are the weaker party, less organised, disjointed, inequalities of bargaining power is dangerous to the desired or needed equilibrium and may not provide the level playing field that is desirous and necessary for a dynamic port sector.
“Effective competition is needed in the industry. The consumers of shipping services have no choice mostly and therefore, no option.
“The ultimate goal is ‘to get many containers out’ and there seems to be a friendly arrangement or understanding by the terminal operators in terms of price, quality and innovation. Lack of competition stifles efficiency and transparency.
“The terminalisation of our ports (26) was to encourage intra terminal competition. The terminals are competing units offering. Again, terminals carry out specific cargo to be handled eg container, bulk cargo, RORO
“Reefer cargo, general cargo, oil and gas, wet cargo and others. It is important to revisit these categorisations to guard against abuse of dominant positions,” he submitted.