What is your position on the appointment of a commercial regulator for the port?
What is your position on the appointment of a commercial regulator for the port?
When we are talking about the regulation of the transport industry, it is long overdue, for a nation like Nigeria that has above 85% of its imports coming through the seaports, there is no country in this world that will leave their transport sector open, and Nigeria is the only one I have ever seen in my life. If you look at the communication industry, if not that they have a regulatory body, you and I may not be able to afford GSM today, but in the transport sector there is no authority of government regulating the sector, this is why the terminal operators, the shipping companies and cargo consolidators will wake up and charge under different nomenclatures, even to the point of collecting ‘cleaning charges’ on containers, even when you are bringing a vehicle into the country they have a charge called ‘don’t start’ which means the car did not start, whether your car is starting or not they will charge you for it and nobody is saying anything, look at the case of container demurrage, you take a container from the port and you are returning it to the shipping company, but as long as there is no space to drop it, you will continue to pay demurrage for it. It is the economy that is suffering for it, the common man on the street, an importer is out to make profit, and whatever he has spent on that container he will transfer it to the consumer, so until the government has a regulator who will look at the pricing, it’s not just to fix prices, but to look at the pricing, because we know what is obtainable in different ports of the world, and whenever anybody erred, there must be punitive measures against the terminal operators. What is the function of the government agencies we have in the port today? Of all the stakeholders in the country, the service providers, the customs and even the agents that take your consignment on your behalf, the only agency on the side of the consumers of shipping services is the Nigerian Shipper’s Council, any problem you have in the course of doing business at the port, the only person that you can run to is the Shippers’ Council, this is what we have been doing over the years and this is because are not a landlord of the port, neither are we an operator, so we are not biased, we take issues as they come, and we are present in more than 26 state of the Federation, so when you talk about the agency that has the personnel, the spread and that understands the port industry across all stakeholders, that agency is the Nigerian Shippers’ Council, and this way the government will spend less, because if we talk of a new agency you talk of human development, you talk of capital expenditure and people studying the sector for a period of years. What I am saying in a nutshell is that Nigerian port system is long overdue for a regulator because it will attract more business. For instance today, the freight from anywhere in the world, Nigeria is the highest, what you pay in Cotonou is half of what you pay in Nigeria, when they started in Cotonou port they had one berth, but now they have eight berths, this is largely because of Nigerian volume of trade going through their port.
Can a commercial regulator force the concessionaires to do what is not signed in their agreement?
The only clause in the concession agreement is that, for the first three years, you cannot review the pricing or the charges, and after the three years if you want to review it you go back to the Bureau of Public Enterprises (BPE). But, by the first year they had started which was not up to 12 months, they breached that agreement to increase the port charges, and in the Nigerian Shippers’ Council Act 13 of 1978, the agency was given the power to regulate port charges, in 1996 there was a ministerial regulation on local shipping charges stating the approved shipping charges that you can collect, there is even an option of fine or jail term. Each time they want to review the charges, we usually write to tell them that it is illegal, and they acknowledge these letters, so if the Shippers’ Council is not recognized as an agent that can review charges, why are they coming to us? There was a time that NPA was claiming to be in charge of port charges, but the ministry wrote to them and copied Shippers’ Council that the council is the only agency saddled with the powers to review port charges.
How has the Shippers’ Complaint Unit help to solve some of the problems experienced by importers?
The Shippers’ Complaints Unit has made a lot of revelations in our maritime industry, through this unit, in 2011 we recovered over N200million for the shippers, the records are there and the statistics are there, we recovered in foreign currencies too, today now everybody knows there is a unit in the Nigerian Shippers’ Council called Shippers Complaints Unit, when you have a problem, come here and your case will be solved for you, that does not mean that we do not have our challenges too, we still have some unresolved cases, we even have some that we advised the shipper to go to court because we know he has a case, and we have seen cases that at the point of taking operators to court, they will choose to settle out of court, this still boils down to the fact that there is nobody that controls the activities of the operators, but shippers complaints unit is doing a very good job, shippers now know that there is an agency they can run to, but we normally advise them is to take their cargo first and whatever have been charged to them will be refunded.
How can Nigeria be able to achieve its dream of acquiring ships?
After the demise of NNSL, the agency of government that was given that responsibility, even before the passage of the Cabotage law, is the NIMASA, they are the ones that government has mandated to assist indigenous ship owners through loans to acquire vessels, so they are ones that can give a holistic report on the matter. If Nigeria is a ship owning nation, there is no gainsaying that it will help our economy, the dictates of carriage of cargoes to Nigeria is not advantageous to Nigerian shippers, if you look at the contract of afreightment to Nigeria, it is on Cost Insurance and Freight (CIF) whereas most countries of the world go on FOB (Free On Board) this is why the freight charges to Nigeria is always increasing, you have no control over your cargo, it is the ship owner that has the control because he is the one that does everything on your behalf, you were not there, but if it is free on board you just pay for the goods and place it on the ship and it sails, so because Nigeria do not have ships, we have to abide by the dictates of the foreign shipping lines, those bringing goods into Nigeria now will tell you that they are coming to a war risk zone because of the Niger Delta, they have an amount they charge, they will tell you there is congestion and they will charge you for it, I know that now they will be talking of Boko Haram and they have an amount they will charge, right now, any cargo coming into Nigeria there is an additionalUS$ 400, so who is suffering? It is the economy, but if we have our own ships in Nigeria then we can compete with them. What is the duty of the terminal operators now that we have concessioned the port? It is just for the ship to discharge and the terminal operator holds it for you until you pay all the dues, but now, a ship will collect handling charges; the terminal operator will collect terminal handling charges, and if your cargo is heading for off-dock terminal you also pay for handling charges too, whereas in your freight agreement all these charges should not be paid by you, discharging the cargo down from the ship is the duty of the shipping company without them collecting anything, but they are collecting money from Nigerian importers, that was why I said that it is only an agency that understands the port industry that can bring about sanity.
What is delaying the successful take-off of the ICD’s?
Nigerian Shipper’s Council is the proponent of ICDs and they have it in five geo-political zones of the country under different stages of development, it is a project that must be realized in Nigeria whether we like it or not, but there is a particular area that will be focused on in order for it to thrive and be successful, and this is the rail, without an effective rail the ICD cannot function, we are talking about cargoes, the volume, the weight and so on, the roads are bad, a road that is suppose to last for 30 years, if you put trailers on it, it will reduce to five years and eventually collapse, so there must be a linkage to all the ICDs, equally, the inland waterways is very vital for ICDs too, if you travel abroad, there is no airport you will go to that does not have rail connectivity, tell me one in Nigeria that is linked to rail.
But it has been argued that shipper’s council does not have the laws to operate ICDs
When the National Assembly talk about oversight functions, what does it mean? It might not be in the extant laws, but these are things that we feel should be looked into, the Shippers’ Council is supposed to be protecting the shippers, that is, importers and exporters on matters affecting their cargoes. You find out that the person you are supposed to be protecting cannot be protected anymore and the ICD is the only way to ensure protection, it is an idea we sold to the government and they embraced it, we are not the direct builder of ICD, we sold the idea to government that it will put an end to congestion and government put it into motion. We are championing a truck transit park now to be in all states of the federation, if you are protecting somebody then you should proffer solutions to the persons’ problems, if we have truck transit parks, our roads will be free and there will be sanity and the shippers will be better for it, all these drivers you see on the roads, if you know what happens to majority of them overnight, there are cases of burglary, pilferage and so on, but if there is a truck transit park there will be adequate security. For example now, the Customs are suppose to be at the borders, but don’t be surprised that they can also arrest you in the city; it is part o their duty to protect government revenue.
How is the level of cooperation that this union is getting from management of Shippers’ Council?
I will say that the union has over time grown through a lot of ups and downs, it is not an easy ride to get to where we are today, we started in 1998, I know where we are coming from, but where we are today, it is the grace of God and the cooperation of the management, you can see we have a befitting secretariat, we are spread all over the federation, we have chairmen in each of the zones with their own executives. We have been partnering with the management, not only on welfare but in term of managerial development and they too are reciprocating in the welfare for staff, will give them 100% pass mark because they are above board on the issue of training, they have taken it upon themselves as their responsibility to make sure the union officers are well trained, it is only when you have well trained officials that you can have less wrangling in the house, they have been sending the union members for foreign trainings, so kudos to them, but like Oliver Twist we will always ask for more.