Managing Director of the Nigerian Ports Authority (NPA), Hadiza Bala Usman, in this interview bared her mind on how the railway will drive economic development and how all terminal operators and jetty owners must comply with international best practice as Nigeria cannot afford to work in isolation. Ugo Amadi reports.
Please explain how Port, rail integration will drive free trade in West Africa?
Honestly, the volume of trade among African countries is still not commensurate to the potential that abounds in the region. But to enhance trade facilitation the region must begin to ensure that relevant government agencies work in line with the integrative vision, and tackle bureaucracies across the countries. We need to cut down on red tapes. We don’t need to fill 50 forms just to move our goods from one country to another. So, besides the need to develop infrastructure, we must begin to tackle bureaucracies.
Also, we must improve on intermodal transportation. Rail and port must be linked and should be developed together. As much as you get all the Chinese loans for rail, you also need to develop the ports through which the cargoes only get to the rail. Our dry ports need to be operational and run efficiently. Railway development is key to unlocking hinterland access, boosting exports and the expansion and oversight of West Africa’s hinterland transport network.
The development of any port without the complement of adequate rail transportation is a recipe for congestion. No country should contemplate establishing Port without the complement of adequate Rail Transportation.
Rail Transportation and linkages shall continue to play a crucial role to port operation, like our experience where the ineffective port railway infrastructure has affected effective port operations.
If anyone had any doubts as to clog that poor railway infrastructure could be in the wheels of effective Port operations, the challenges that we currently face with the Lagos Port Complex (LPC) and the Tin-Can Island (TCIP) would instruct you about why no country would contemplate establishing Port without the complement of adequate Rail Transportation” she said.
The truth is that a substantial part of the challenges that we face in the optimization of the ports in Lagos area which has even extended to distort normal activities of Lagos is because of the failure to provide adequate rail infrastructure in the first instance and the failure eventual dilapidation of the meager structure that was available at the beginning” Hadiza added.
What will you say are the gains recorded and what areas do you wish to concentrate more on this 2019?
In 2003, the Federal Government of Nigeria initiated the drive towards improving efficiency at our ports and a landlord model was adopted for all the ports in the country. This gave rise to the concession of 25 terminals to private terminal operators with lease agreement ranging from 10-25 years.
One of the concessions was a Build, Operate and Transfer (BOT) arrangement. Also in the process of reorganizing the ports, the former eight ports were reduced to six major ports, with two ports in Lagos and four in the East namely; Lagos Port Complex, Tin Can Island Port Complex, Calabar Port, Rivers Ports, Onne Port Complex and Delta Ports Complex respectively.
In line with the reform programme, the transaction commenced with the advertisement for Expression of Interest on December 3, 2003, by the National Council on Privatization with the Bureau of Public Enterprises acting as the transaction agent. A total of 110 EOIs were harvested out of which only 94 were pre-qualified. Pre-bid conferences, data room, and physical due diligence were also done and request for proposals sent out to bidders.
Technical bids were submitted and evaluated; the financial offers were also opened to determine the successful bidders. All the successful bidders negotiated their concession agreements with a public sector team made up of Nigerian Ports Authority and the Bureau of Public Enterprises. Successfully negotiated agreements were signed and the transition programme initiated preparatory to handing over. Under this new arrangement, the authority ceded to the private sector some of her functions and responsibilities However, as a landlord, we oversee the activities at the ports to ensure strict compliance with the agreement. On assumption of office, part of what I saw was total confusion; access to the Lagos Port Complex and Tin-Can Port complex was difficult; compliance to the International Ships and Ports Facility Security Code (ISPS) was not followed to the letter.
I engaged all stakeholders in a series of discussions on how best to improve on what was on the ground. What kind of synergy does NPA have with other agencies? We have an avenue where we have seamless interactions with other agencies. We are also working with the Presidential Committee on Ease of Doing Business which is led by the Vice President. This committee has provided platforms for various agencies of government. We will continue the synergy under the arm bit of that committee. This is very important as we look towards having operational efficiencies within our ports.
As we have these agencies, we are also mindful of our relationship across the board. We are also careful that there is no duplicity and overlapping which could result in a challenge. Governance needs to be seamless; governance needs not create bureaucratic bottlenecks for the people. We are also sustaining discussions among ourselves.
How is NPA going to cope with the ban on vehicles import through land borders?
With the ban on importation of vehicles through land borders, NPA is very ready to have seamless operations to increase traffic because we have seen traffic dwindling in the port as a result of some government policies on importation of new cars. With this ban through the land borders, we will record an increase in activities in our ports and we have put in place mechanisms to ensure that additional traffic will not cause any bottlenecks.
We have always had the capacity, it’s just that it has not been well utilized. Now that we will hopefully have increased traffic following the ban, we just have to upgrade on what has existed. Our terminal operators have been trying to increase traffic, so they are ready to take on the increase. Since I came, I have commended the strength and capacity of the staff I met on the ground and we are keen to sustain that. We will make sure that what we meet in NPA, we will utilize before looking outside for persons to fill up positions.
What effort are you making to recover NPA’s money trapped in Aso Homes and Heritage Bank?
The N400 million trapped in Aso Savings, we are working to see how we can get that out. We will appreciate it if we can get a letter stating the account number and account name to enable us to follow it. Indeed, during the submission, they didn’t actually say Aso Savings but they said Aso Homes and I asked that they provide the exact names and details so that we can pursue it. In the same manner, we are pursuing our money in Heritage Bank.
They have paid a certain amount but we still have about $19 million with the bank. We have been having meetings with the Central Bank to see how the money can be returned to the coffers of the Federal Government. We are still pursuing it aggressively to ensure that the money is returned to government.
In a bid to ensure healthy competition among existing ports and the ongoing work on Lekki Deep Sea Port and Badagry Deep Sea Port, the Nigerian Ports Authority (NPA) is developing a ports master plan to be unveiled in the next six months. Is there any plan to review the port concession agreement?
I met on ground concessions that have been 10 years in operation and I believe that it is time for us to have a review. The concessionaires themselves believe that it is time to look at some of the terms. The economic situation in which some of the concession agreements were entered into is not the same today. There are clear assumptions that were made within those initial concessions that are different now. There are also respective obligations across both parties that have not been met within the 10 years. I think it’s time for both parties to seat around the table and review those terms to determine what obtains today. Within the concession agreement, everyone can confirm that there was a need for a review within two years but we have waited 10 years for a holistic review of the concession agreements. We have also noted the few review in view of tenor elongations without a commensurate review of the financing model, which are tied to each other. Whatever timelines you have for the revision period is tied to the financing model and a tariff regime which is contained within the concession agreement.
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