After years of prevarication, the Federal Government appear set to weed-out non-performing port terminal operators. The action has already been concluded, even as top officials of the Ministry of Marine and Blue Economy allege that the Minister; Adegboyega Oyetola had been tempted with juicy offers to compromise, but he refused.
In what could be a major shake-up in Nigeria’s port operations, the Federal Government will deny license renewals to several terminal operators whose concession agreements expired years ago.
The first set of terminals were concessioned in 2006, which varying concession agreements, covering different years.
Shipping Position Daily has confirmed that the Federal Government is interested in engaging new port terminal operators to take over from those whose concession agreements have since expired, and those who have breached the concession agreements or have performed poorly.
The affected concessions cut across terminal in Lagos ports, Port Harcourt, Onne, Warri and Calabar ports.
The affected concessionaires (identities withheld) are all operating on expired agreements, some dating back as far as 2012.
A highly-placed source within the Ministry of Marine and Blue Economy, who spoke on condition of anonymity, revealed that the government has no intention of renewing these expired concessions, citing poor performance and lack of substantial investments by the operators.
According to the source, the decision to sack the terminal operators was based on multiple assessments, including a World Bank report, which recommended a total overhaul of the Nigerian port concession system, due to the operators’ failure to meet global industry standards.
Justifying government’s position, the source told our correspondent that, “These people are simply milking government assets without reinvesting in the terminals”.
In a veiled reference to the much-expected upgrade of port infrastructure for which government taking a loan, our source asked rhetorically: How can we inject massive investments into modernizing and rehabilitating the ports and still hand them back to the same under-performing operators? It won’t work”.
According to him, the Ministry of Marine and Blue Economy is already working out modalities for engaging new terminal operators. “The process will be thrown open for competitive bidding, and whoever wins, wins,” the source stated.
The official further alleged that several terminal operators had made numerous attempts to compromise the Minister of Marine and Blue Economy, Adegboyega Oyetola to secure their renewals, but they failed due to his firm stance on transparency and integrity.
“They will never tell you the ridiculous amount they are paying to the government; instead, they are quick to claim that the minister has refused to renew their licenses. The truth is, even under the previous administration, the Federal Executive Council refused to renew their licenses after realizing that what they were paying was not commensurate with the value of the assets they controlled.”
Perhaps giving credence to the emerging dispensation, checks by Shipping Position Daily revealed that foreign investors have showing keen interest in taking over the terminals.
Multiple sources confirmed that port operators from the United Arab Emirate (UAE), specifically; Abu Dhabi and Dubai have expressed strong interest in taking over some of the terminals.
Industry insiders suggest that the entry of these global players could bring a wave of efficiency, technological advancement, and improved service delivery, raising Nigeria’s port operations to international standards.
Reactions from industry stakeholders have been mixed. In a chat with our correspondent, Mr. Babatunde Mukaila, former National Secretary of the Association of Nigerian Licensed Customs Agents (ANLCA), dismissed concerns about the delayed renewals affecting cargo clearance.
He argued that the government is likely taking its time to restructure the process to ensure a more effective concession system.
“The renewal or otherwise has not really impacted cargo clearance. I believe the government is trying to get things right this time. If they are delaying, there must be a reason. What matters is ensuring that future agreements are stronger, holding operators accountable to both the government and shippers,” Mukaila said.
However, Dr Muda Yusuf, Chief Executive Officer of the Centre for Promotion of Private Enterprise (CPPE), warned that the uncertainty surrounding concession renewals could damage investor confidence.
“Some of these concessions have expired for over five years. That creates uncertainty for the operators. Without clarity, it becomes difficult for them to plan long-term investments, expand, or acquire new equipment. The government needs to address this situation quickly to prevent a negative impact on port efficiency,” he said.
Our correspondent further gathered that the looming decision by the government is expected to spark resistance from the affected operators, who are seeking legal redress to hold onto their terminals.
However, sources within the ministry insist that the era of non-performing concessionaires is coming to an end, and only those who meet industry standards will be allowed to operate.
