When the government of former President Olusegun Obasanjo introduced the policy of bringing in the private sector into port operations, it was met with resistance by stakeholders, especially the workers of Nigerian Ports Authourity (NPA) who (understandably) felt threatened and vowed to oppose it with all that they had. On the part of others, it was borne out of the fear of the unknown as well as the fear of cost of doing business in the ports, thereafter.
To put the issues in proper perspectives, it is important to bring out certain facts. Government’s first argument in support of port concession was that the ports (just like other businesses could be better operated by the private sector. Secondly and rightly too, government also observed that the nation’s seaports were becoming too expensive in the face of decaying facilities.
The workers’ threat turned out to be a mere empty threat, as not only were the ports concessioned, thousands of employees of NPA were laid-off, while the unions only managed to negotiate severance and disengagement packages for the workers.
The options were between commercialisation and outright concession. Government, in defiance of better and by far more superior arguments, decided to settle for port concession. It eventually had its way, having won to its side (or is it blackmailed) the two house unions; namely the Maritime Workers Union of Nigeria and the Senior Staff Association of NPA.
The exercise that was flagged-off at the Lagos Port Complex about 10 years ago with pomp and pageantry has since being adjudged as very successful, even though at the initial stage it was subject of litigation, name-calling, threat to lives and petitions to both the Presidency and the National Assembly.
Since that decision was taken and the eventual handing over of the ports to private terminal operators, there is no doubt that things have changed for the better. No doubt, ship’s turn-around time has improved tremendously from an embarrassing almost four weeks to as low as one day in some terminals, while ships no longer have to wait for days at any of the terminals. There is also a significant reduction in human traffic into the precincts and peripheries of the ports. Cases of vandalism, cargo theft and container broaching have dropped drastically. Certainly the ports are doing better than they were; pre-2006.
But, will it be correct to assume that once the above are evident, then port concession is a total success? This newspaper is of the opinion that these are not sufficient indicators of a healthy, successful and fair-price port system.
And this is why we are in support of the deafening calls for a review of the 10-year old exercise.
Even though successive ministers of transport said they were interested in carrying out the review, they never allowed it to be. So, when the incumbent; Mr Rotimi Amaechi said in February this year that he would pursue a review of the concession agreements that were entered into between the Bureau of Public Enterprises (BPE) on behalf of the Federal Government and the terminal operators, again, we had hope.
While addressing maritime industry stakeholders at his first meeting with them in Lagos in February, the Minister had lamented that the Federal Government was not getting adequate revenue from the maritime sector despite its huge potential. “What the maritime sector contributes is too insignificant compared to its potential. Why? We need to find out why?” he had said.
He also confirmed that an audit firm would be engaged to take a second look at the concession agreements.
Surprisingly, the Minister had also told his audience that “the port is nearly the same after the concession. I don’t think we are making the kind of money we should be making.”
But, while responding, the then- Managing Director of NPA; Habib Abdullahi Abdullahi tactically disagreed with the Minister. He described the concession scheme as successful. “Look at where we were and where we are now. Look at the level of sophistication”, even as he agreed that “we should review what has happened, compare some performance with others.”
A few things are actually wrong with the processes that led to the emergence of some terminal operators. There were allegations of abuse of due process, breach of trust in the transactions and sundry other unwholesome practices. But 10 years down the line, these agitations do not appear to be prominent any more.
Certainly, after 10 years, there are still proven cases of under-utilization of some terminals and non-availability of some common-user facilities that Nigerian Ports Authourity ought to have provided.
While many of the concessioned terminals in Lagos can be said to be doing well at the beginning, the same cannot be said of those in Calabar, Warri and Port Harcourt.
One of the most important missing links in the implementation of the port concession policy is the absence of a commercial regulator to handle commercial disputes arising from the interactions of operators. This has largely affected the relationship between the landlord (NPA) and its tenants(the terminal operators) on one hand, and the relationship between the users and suppliers of port services.
We are totally in agreement with the position of majority of stakeholders that, a level-playing field should be created as it is the only way to encourage growth and stimulate development among all players in the port concession game.
Most importantly, the expected review should empower whoever is regulating to enforce its intervention. It is saddening that even though the Nigerian Shippers Council has been gazzetted as the ports economic regulator, yet it has been bogged down with serial litigations by terminal operators and shipping line agencies.
If the review can take care of appropriate port pricing, fair competition among players and ensure responsibility among the tenants and the landlord and empower the regulator, then it would have achieved success.
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