We’re making port operations, effective, competitive, says Bello
Recently, the Executive Secretary, Nigerian Shippers’ Council (NSC), Hassan Bello, led a team of his management staff to The Guardian headquarters, in Lagos, during which he discussed sundry issues relating to the Nigerian maritime industry and what the Council is doing in particular to institute seamless import and export operations in the ports. Excerpts:
It unfortunate that the Maritime industry has been operating below expectations over the years, are we expecting any respite soon?
We are looking at putting the transport industry in its right pedestal, where we can say now you can go and lock the oil operations because the transport system itself can finance the budget of this country. The recession is a wakeup call for diversification and transparency, and I think there is no better place to showcase the diversification of the Nigerian economy other than the transportation sector, especially the maritime sub-sector. I want The Guardian Newspapers to take is as an obligation to really sensitise the sector; we want you to support the industry because so many things are happening. The 48 hours cargo clearance and 24 hours port operations, in which the ports are going to operate round the clock; even the airports do that, why will our seaports close at six? It does not make sense. What we must know is that the port operations must be friendly, effective and competitive, because we are competing with our neighbouring ports. All these things you hear about diversion of cargoes is not really diversion because the shipper has the right to nominate his port of destination, it’s an economic decision in which you have to consider many factors, including, but not limited to the length of time it takes to clear your cargo.
Delay in clearance was before, now, the Shippers Council has intervened, and we are shortening the process of clearing cargoes. We are interrogating the system all the time, and our aim is to make you sit down in The Guardian if you import a car, and clear your good on your computer, and the car will come to Rutam House or wherever you want it to be. You don’t need any physical presence at the port, because it is the physical presence and actual money transaction that brings corruption, inefficiency and delays. That is the hope we have and that is the port of our future. Right now, we have in fact been taking goods away from our competitors, because Nigerian Shippers Council together with the Nigerian Ports Authority (NPA); Independent Corrupt Practices and Other Related Offences Commission (ICPC); United Nations Development Programme (UNDP), and many others, have designed what is called the Standard Operating Procedure (SOP). This is in accordance with the classical thing that is done in every port. If it is done in Cotonou, it is done in Lome, Morocco, and Egypt,
why wouldn’t it be done here in Nigeria?
We now also have a portal at Shippers’ Council where every complaint will be online, and it is treated by nominees of the agencies you are complaining about. These are pointers to what we want our ports to be. The port is one of the first things you know as an indicator of economic seriousness. If you bring goods and they stay seven days without clearance then something is wrong. If you clear your goods, but the road is not good for you to evacuate the cargo then something is wrong. So, the Shippers’ Council is a neutral impartial arbiter; we are the umpire, the referee, the coordinator of all that is happening at the ports. We are acting as representatives of the terminal operators, and the shipping agencies, because the government has to provide a conducive atmosphere for the private sectors to thrive.
We want to guarantee their investment. We want to protect their investment. We want to give them good operating conditions, and that is why we frown at the bad roads and even linkages to the seaports. We want the ports to be assessed not only by road but also by rail, inland water ways. If we have pipelines, all these tankers would not have to come to the tank farms and congest the Lagos logistic roads. We have carried out a study by the World Bank on the Lagos Logistic roads, where it was said that along Iganmu, Orile, and Apapa there are always about 5,000 articulated vehicles, meanwhile what is needed is 1,400, because there is no modern traffic management system. The NPA is now handling the issue and in about 18 months we will have an electronic gate. The Apapa traffic will be a thing of the past because you will be only around that premises if you are needed. Your vehicles cannot even pass because you have the electronic chip for you to access. We have to harmonise ourselves and have semblance of advancement.
Why is so much emphasis on Lagos when there are other ports in other parts of the country that can also be developed?
The concentration of port activities in Lagos is historical; when the colonial masters came, they found Lagos and Lagos is indeed a natural place to make a port because some of these ports are not natural ports. The ports in Lagos are artificial, they are not harbours as such and that is why we have difficulty in maintaining them. We have to dredge the channel, the approaches and even the berth. And the draft is about 11 meters after dredging, but there are natural places in Lekki for example that will go up to 14-16 draft.
Deep seaports are natural ports and because of the economies of scale, you can have larger ships coming. When larger ships come that means the freight cost is low, that means Nigeria will be a hub, so that those with shallow ports will come here and take their cargoes. That is what is going to happen with the Lekki and Badagry deep seaports, and they are easy to maintain. Besides, I don’t know whether the city met the ports in Apapa or the ports met the city, but they have exceeded their capacity, because when people mingle and you are driving from Apapa to my office, you share the same road with trailers and tankers. This is not acceptable; ports road must be exclusive to operations. I think this is being addressed through the Traffic Management System, which is being supported by the World Bank.
Nigeria is ranked low in the ease of doing business where the drive for revenue is making the ports uncompetitive?
We have talked with the Nigeria Customs Service that they should be more of a trade facilitator than a revenue collector. What is even more annoying is the competition that the Apapa Command has collected this amount; Tin Can has collected that amount. That is not good. When you make trade facilitation, you will bring modern equipment that means you will even increase the Customs collection. So, we will continue to talk with the Customs. The new Comptroller General of Customs is working towards that. We must have ease of doing business; otherwise our ports are not competitive. Our ports should be friendly, they should be predictable. How much you clear a container from the port should be on the website of every operator, and that is the next stage we are going. It is important for our ranking at the World Bank, and the Presidential Council for the Ease of Doing Business, under the office of the Acting President, and which the Shippers’ Council is also an active member, is looking holistically at these issues. It is not only at the seaport, but also at the airports, immigration, Corporate Affairs Commission, the land issues and so many others, but port is a special area of it. We have to really commend them because they have changed the way the agencies behave. The agencies must be accountable such that at the end of the day this is what you have done.
We have taken the port portal, and we have decide that we are going to make it an industry product for use, where you can sit down on your table and track everything you want to do at the ports. We have other products which we are using. Sometimes you don’t see these things because the Shippers’ Council is not an operator, but it has many ideas, which it allocates to operators and different agencies; the ultimate being the National Single Window, which is also on course. You will agree with me that the Ministry of Transportation is the busiest in Nigeria today. We are currently planning to sanction any concessionaire who has not done any appreciable development. The procurement processes are always lengthy and tedious, it also means you have to go to ICPC, Bureau of Public Procurement (BPP), and sometimes each process takes about 18 months, and we have recommended that some of these things should be reviewed to make them brief. Competition is also important in our relationship with the terminals. You know the terminals have been concessioned and we need intra-competition between them so that the importers will have choices.
In 2013 you described the ports as being “near primitive”, what has changed since then especially as many of the challenges persist even today?
In 2013, it was near primitive, but in 2017, it is beginning to look not so primitive, if I may put it that way. We have been gaining and that is by statistics. Turnaround time for ships have improved; payment has improved, the NPA had a payment system in 2013 and 2015, where you have to go to the bank and collect tellers, then you run to Apapa, you are sweating all over, you will spend like six days, but now it is done in six seconds. It’s one central payment, which is electronic. That is why I am telling you that what we mean by primitive are physical things that are not yet automated. We have started with the payment; we are going to start talking with the scanners. There is also an Advanced Cargo Manifest System, which is the Cargo Tracking Note. When you track cargo, even before the goods leave the ports of origin, you already know, even the Customs will be able to do the risk assessment, and you can pay duty even before they come in. So it is a tortuous journey, and it’s not been easy. We are introducing new things. We are bringing out revolution, but there will be resistance, and we have envisaged that.
Also some terminal operators have done a lot if you look at their operations; they have also sanitised their system, they have modified the way they operate, they have made massive investments, they have brought machinery and the equipment, and I think we have to commend some of these operators. Not all terminals are the same and that is why I said we need competition. Have you ever seen an advertisement from the terminal operators to woo people? That means something is wrong. There is no competition. That means there is connivance; and it means we are only replacing public monopoly with private monopol,y and that is why we said competition is essential, it brings up efficiency and reduces cost.
Stakeholders have complained that shutting down the access roads in Apapa for one year is too long and resource wasting, considering the importance of the ports to the economy, more so, as the airport runway was concluded in six week. Is there no way to reduce the time frame for the repairs?
The road maintenance is not one year, it’s a continuous thing. What we are saying is that the bad part of it will be considered, while we are doing it, there will be access of course. The whole road network is a continuous thing, but one essential thing is that it would be complemented by rail. Once you do rail, then you don’t have trailers coming from Kaduna, to pick cargoes because the train will take the goods to Kaduna. We are bringing shipping to your door steps; you don’t need to come to Lagos.
Recently, the Council has been going on about establishing dry ports in some parts of the country, what is the idea behind the dry ports?
The dry ports are relocated in the coastal areas, if we have a port in Onne, which is Port Harcourt; you may not have coastal in Isiala Ngwa which is inside. Nigeria is blessed with large but vast hinterland, and if we make the hinterland to also be economic site, the idea is not just for containers to be taken to the dry port, the whole idea is to stimulate the economy of the places where these ports are located. I think in the hinterland there are lots of economic activities, and the location of transport activities like a dry port will galvanise economic activities in those hinterland especially the exportation of products.
At the Kaduna dry port, what is the situation of the rail lines?
Railway is key, actually the success or otherwise of the dry ports will have to substantially be whether rail is serviced, and all the dry ports have rail locations as one of the indices for their location. Kaduna is already bringing containers to the Inland Container Dryport (ICD) because it is serviced by rail in and out. It was a bonded facility for a long time, and what the Shippers’ Council did was to elevate it and bring out some specifications, and the Kaduna State Government has given us tremendous support. They are building the roads in and out of the port. They are also linking activities to the dry port. They have some infrastructure such as the refrigerated warehouses and some other things. We are continually talking with the operators of the ICD in Kaduna, and they are working hard to find ways to provide the necessary facilities. Until it is provided, we are not going to commission the port. With the dry ports, we have to avoid the mistakes of the seaports; we are not going to have a dry port where we will take the containers with the attendant problems of congestion. No, we are going to have a modern and sustainable dry port – electronic gating, traffic management, good storage bolstered by rail in and out, easy to evacuate and automation, which is key to efficiency of the port.
With automation, how do you intend to curb the importation of sub-standard goods now that SON is no more in the ports?
The issue of sub-standard goods is a very critical issue to the economy, because sub-standard goods kill our industries. The Standard Organisation of Nigeria (SON), which is also our partner in this fight is doing all to see that the menace is curbed. It is also a question of inspection; destination inspection and pre-arrival inspection of goods. That is why the Advanced Cargo Manifest System, which the Shippers’ Council is working hard to introduce, will solve a lot of problems including the absence of SON or any other agencies at the ports. Time will come that you don’t need to be at the ports to know what is coming. The agencies are only invited when you have reasons to invite them. All the ports are Customs port; by the time we introduce the automation you don’t need to go to the port. What are you going there to do? Even as a freight forwarder you will be in your office clearing goods.
Nigerian Shippers Council has been described as a toothless bulldog. When will it begin to bite?
It is not a toothless bulldog, but it has never been a fox or wolf either. The Shippers Council does not even operate anything, it is a think tank, and why we cannot have teeth to bite is because of our operating laws. In 1970, the Shippers Council was created, there were a lot of latent regulatory powers under the law, but it’s in form of advice on freight rates, availability of vessels, quality of vessels and port operations. Do you know why the provisions were not biting, is because government was also operating the ports system at that time. So, it was thought that because it was government to government, no need for you to regulate. But things have changed now; it is trade in commerce and international trade that would create an organisation. In 1979, the first regulation was the local shipping charges then showed that there is need to regulate because the terminal operators have taken over. We have an Executive Order by the President, which we are using to operate.
It also has limitation, so we cannot act ultra vires or beyond our powers, but I am happy to tell you that we are looking at the National Transport Commission (NTC), which is a multi-sectoral commission trying to bring economic regulation or moderation. The House of Representatives have already passed the bill and recommending that the Shippers Council should form the kernel of that NTC. If that is passed by the Senate, and signed by the Executive, there will be smooth transition. We are not headmaster regulation, we are a liberal regulator, we are democratic regulator, and we want to bring everybody together, just like we did with the Customs.
When people complained about Customs, we sat the parties down and resolve the matter. People come to see us and thank us for the liberal but active intervention. We have a Complaint Unit, we have solved complaints that worth millions of dollars. For example, the Power Holding Company of Nigeria brought in equipment but no money to pay; we solved the issue. Bi-Courtney, the concessionaire of the Murtala Mohammed Airport 2, had problems and they came to us instead of going to the lawyer, in less than a month, we solved the problem and shook hands over it. The Super Eagles had their jerseys trapped in the port for some reasons, and we intervened. Every day, people come and we solve their problems, but now the problems are reducing because we have indices to see what are the most problems and why do they occur.
We have done so many things to change the system, even we have configured the boxes and how stock fishes will be handled. We are doing everything; people are just doing whatever they want at the ports. We are talking about regulation, tariffs, and standards. We are going to audit your terminal and determine what the base is. How many moves do you make in a day? Why keep containers so that they will attract demurrage? It’s like people playing football in the park, you can do anything, you can even use your hand to score, but certainly the referee appears and blows his whistle, and says, ‘no, you have to play by the rule.’ But everybody will grumble, because nobody wants a referee.
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