Recently, there appeared a glimmer of hope about the delayed renewal of the port concession agreement with the terminal operators, when the Minister of Marine and Blue Economy; Mr Adegboyega Oyetola told this newspaper that the long wait will soon be over.
It is about 18 years since the Nigerian Ports Authority (NPA) ceased being the master stevedore, handing over port operations to the private sector.
But since the landmark exercise took place, some developments have given credence to the apprehensions in some quarters that there were faults inherent in the Nigerian port concession process.
The exercise has largely been fingered for allegedly creating an unhealthy monopoly, it also did not make room for post-concession regulation, and lastly, there was no enabling law to guide the new stakeholders; including the NPA and the terminal operators.
While the man who midwifed the exercise as the then-Managing Director of the Nigerian Ports Authority; Chief Adebayo Sarumi had once openly-admitted that one of the concessionaires; APM Terminal was undeservedly favoured to monoplise container handling at the Lagos Port Complex (LPC), others stakeholders have at one time or the other, also picked holes in the post-concession relationship between regulators and operators.
They argued that NPA has failed to live up to its responsibilities as penned-down in the port concession agreement. Some have also noted that terminal operators now bore many unanticipated costs while NPA only collects ‘underserved’ royalties.
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, the government also observed that the nation’s seaports were becoming too expensive in the face of decaying facilities.
The options were between commercialisation and outright concession of the facilities. 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 the two house unions; namely the Maritime Workers Union of Nigeria and the Senior Staff Association of the NPA.
Since that decision was taken and the eventual handing over of the ports to private terminal operators, can one rightly say 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, while ships no longer have to unnecessarily wait for days at any of the terminals. There is also a significant reduction in human traffic into the precincts of the ports. Cases of vandalism, cargo theft and container broaching have dropped drastically or even non-existing. 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?
Certainly, after about 18 years, there are still proven cases of under-utilization of some terminal, and non-availability of some common-user facilities. that Nigerian Ports Authority ought to have provided. While many of the concessioned terminals in Lagos can be said to be doing well, the same cannot be said of those in Calabar, Warri and Port Harcourt.
The NPA has acknowledged that some infrastructures in the terminals have decayed and required either reconstruction or rehabilitation. The plans are already afoot.
There have been lamentations from all the parties that are currently either supplying or using port services. They include: NPA itself, terminal operators, clearing agents, truck owners, shipping companies, and even the workers.
Other users of services also have axe to grind with the terminal operators, the workers are not left out.
Yes, the fact that there are things such as: Higher cargo throughput, low turn-around time for vessels, non-vandalism or cargo, cleaner environment, perimeter fencing are sufficient reasons to clamour for a renewal of the concession agreement with the terminal operators.
As good as they are, yet they are not enough indices of a healthy, successful and fair-price port system.
A lot of people, especially those who are sympathetic to the cause of the private terminal operators misconstrue the call for a review as a call for termination of the concession agreement between the terminal operators and the NPA. Far from it.
This, certainly is not true. We are aware that the intentions and the parameters of the proposed review have been well spelt-out.
We and of course, stakeholders in the Nigerian maritime industry are also aware that the concession period of some of the terminals have ended at different times, and that some of them (if not all) have secured an extension. So, it is not out of place to request that the whole agreement be reviewed and the gaps blocked.
And this is why we are in support of the deafening calls for a review of the 18-year-old exercise, that will take cognisance of the identified loopholes.
It is sad that the terminal operators have had to contend with an illegal arrangement as it is, where they can not embark on business projections and consummate new ideas, for the reasons that they do not have valid legal documents for the leases that they enjoy. The negative impact of these can be overwhelming for an international business such as port terminal operations.
We empathise with them knowing that the prolonged delay would have destabilized their operations, caused uncertainty among customers, and hindered potential new business opportunities.
At the moment there is no clarity and direction, which may have significantly affected their ability to plan and execute long-term strategies.
Even though successive Ministers of transportation said they were interested in carrying out the review, they never had the guts to do it.
Similarly, successive CEOs of the Nigerian Port Authority have also given assurances that were not fulfilled.
Now that the minister of Marine and Blue Economy has given assurances, we hope it will come to pass. The Federal Government should consider the impact of the delay on the various concessionaires in the port, and hasten the process.
It is also our hope that the review and renewal process will be a holistic review of the entire 2006 agreement, taking cognisance of the various legal lapses and the new realities.
