Inefficiency, opacity, others mar 2006 port concession reforms

Inefficiency, primitive cargo clearance procedures, lack of transparency, manual ports operations, high cost of doing business and delays in cargo dwell time are challenges still hindering the country from reaping the benefits of the 2006 port concession reforms.

These were submissions of stakeholders at the Maritime Reporters’ Association of Nigeria (MARAN) 34th Anniversary and Awards held at the weekend in Lagos, with the theme: “16 Years of Port Concession: The Pains and Gains.”

The Former Executive Secretary, Nigerian Shippers’ Council (NSC), Hassan Bello, in his presentation titled: “The Pains and Gains of Port Concessioning,” said while the government went into port concession reform to address the several challenges that bedeviled the system, most of the issues still persist, thereby hindering the nation from reaping the benefits of the reform.

Bello said the government went into concession reform because the port sub sector was not contributing to the economy, while the entire port system was not well run and was characterised by blatant inefficiency in operations, unbridled corruption and lack of conscious linkage between the sector and the economy.

He also pointed out that the ports operated alone – largely outside significant economic contribution, with no competitiveness, while infrastructure was ancient and dilapidated, which caused inefficiency.

Bello said the government had policy somersault and did not meet the infrastructural needs of the maritime sector, adding that there was no planning, projection and sense of linkage/connectivity, alongside opaque regulatory framework.

He said the country’s ports could not meet up with the maritime demand of the domestic economy and international community, hence, the reform became necessary to maximise economic benefits derivable from the maritime sector.

Bello said some reforms are substantial, deep rooted and impact meaningfully on the society, while some are narrow, haphazard and lack depth, thereby, bringing more confusion than the condition they seek to change.

He said the government carried out reforms to structurally determine the model of port administration, hence, adoption of the landlord mode and transfer of port ownership and operation to private sector within a specific time.

Bello said this was done with the hope of having an efficient port system acceleration that would link the country to the world economy, thus, opening up markets and opportunities, international trade and earnings, more throughput translating to employment, wages and productivity, reduced transport cost and less inflationary trends.

Others are easing financial burden on the government (national budget), lower freight cost for shippers, exporters and importers as well as cheaper cost of imported goods among other quantifiable benefits.

He said despite the reforms and expectations, the ports are still faced with inefficiency in operations, delays resulting in high cost; lack of transparency on charges, rent and demurrage; hidden and under the table payments making doing business difficult and expensive; primitive, tedious and compromised cargo clearance procedures; manual processes and delayed cargo dwell time.

Bello said port reform in Nigeria started without regard to other sectors, noting that it was not comprehensive and ran risk of being derailed, curtailed, distorted reversed hugely because the legal framework was not dynamic and wholesome.

Bello said ports play significant role in a nation’s economy such as, linking local to international economy, source of revenue to government, increase international trade, employment and wages, reduction of transport cost, enhance direct foreign investment, aid diversification from mono economy – oil and a stimulant to increase production and industrial output.

He said to see the maximum benefits of the reform, the Federal Government must provide conducive operating procedure, ease the cost of doing business and fight debilitating corruption that threatens to put a brake on reforms.

He said the government must perform its part as a major driver of the reform by building and enhancing critical transport infrastructure on which the port reform is anchored to have greater influence on the economy.

Bello also stressed that regulatory institutions must be assigned specific roles, noting that the involvement of stakeholders is necessary, not only in drafting agreements, but in monitoring the tenants of the agreement.

The former NSC helmsman called for a review, enactment and guiding reform bills like Port and Harbour, National Transportation Commission, Nigeria Railway and National Inland Waterways Authority, among others, that have been abandoned at the National Assembly and the Presidency.

Speaking during a panel session, the spokesman, Seaport Terminal Operators Association of Nigeria (STOAN), Dr. Bolaji Akinola, said the concession reform brought both pains and gains.

He said before the concession, dockworkers were casual workers and went home with N1,500, which has changed as they now earn well.

While saying port concession led to loss of jobs, Akinola said should be ameliorated by the Federal Government, and whatever is due to them should be given.

He said although there are still some ancillary challenges like clearing processes and infrastructure, he raised the need why they should be addressed for the country to fully enjoy the benefits of ports concession.

Another panelist, who is Registrar, National Association of Government Approved Freight Forwarders (NAGAFF) Academy, Lagos, Francis Omotosho, stressed that over 8, 000 port workers were laid off without being paid, noting that some are living in penury, while others have died due to the effect of being laid off.

Responding, the Minister of Transportation, Mu’azu Sambo, said the Federal Government is not owing dockworkers sacked due to port concessioning reform in 2006.

He said the dock workers affected were all paid, noting that the only set of people that were not paid then were those working for the private sector, but were given severance packages.

Sambo also emphasised that the Federal Government would remain committed to policies that would boost the growth and development of the Port Community System.

He said the government is embarking on projects to help the maritime industry, including the Deep Blue Project, which would ensure cost of importing cargo is reduced.