Count­ing the gains of ports reg­u­la­tion

Daily Trust - - OPINION - By Tunde Ogungbe­san

For many years, do­ing busi­ness in Nige­rian ports was roundly con­demned as a har­row­ing ex­pe­ri­ence. This stemmed from the high level of in­ef­fi­ciency that char­ac­ter­ized the op­er­a­tions at the ports such as un­nec­es­sary de­lays in the turn­around time for ships and high cargo dwell time.

The con­se­quences of th­ese were that sub-stan­dard goods found their ways into the coun­try, the na­tional trea­sury was de­nied its due ac­cru­als, youth un­em­ploy­ment blos­somed and the masses were short-changed as the im­age of the coun­try dimmed in the comity of na­tions.

How­ever, a tinge of re­forms in­tro­duced in 2006 when the ports ter­mi­nals were con­ces­sioned to the pri­vate sec­tor by the fed­eral gov­ern­ment yielded lit­tle re­sults. This is be­cause con­ces­sion­aires re­port­edly cap­i­talised on the ab­sence of a reg­u­la­tor to in­tro­duce scathing charges that have swelled the cost of do­ing busi­ness in Nige­rian ports.

The de­vel­op­ment was viewed by stake­hold­ers as rather un­for­tu­nate be­cause the con­ces­sion of ports to the pri­vate sec­tor was aimed to ac­cel­er­ate the pace at which the coun­try’s ports will be­come the pre­ferred cargo des­ti­na­tion for, not only Nige­rian im­porters but also, ship­pers from some West African and Cen­tral African coun­tries.

Sev­eral years into the im­ple­men­ta­tion of the sea­port con­ces­sion scheme, there were com­plaints over sim­i­lar cost regime by for­eign ship­ping agents, the mul­ti­plic­ity of levies on im­ports and in­ad­e­qua­cies of other stake­hold­ers in the sea­port sec­tor.

No doubt the con­ces­sion­ing of the sea­port led to the mod­erni­sa­tion of the op­er­a­tions of the ports and a great level of ef­fi­ciency. Yet, the gains did not trans­late to re­duc­tion in cost of do­ing busi­ness at the ports, a de­vel­op­ment blamed on the fact that the fed­eral gov­ern­ment did not im­me­di­ately ap­point a reg­u­la­tor for the ports sec­tor.

Then came the Nige­rian Ship­pers’ Coun­cil (NSC). De­clared the eco­nomic reg­u­la­tor of the ports by the fed­eral gov­ern­ment in Fe­bru­ary 2014, eight years af­ter con­ces­sion­aires took over the man­age­ment of the sea­ports. Since then, the NSC has stamped its seal of ex­cel­lence through en­force­ment of its ex­tant rules.

The NSC has ac­quit­ted it­self by en­sur­ing that all the stake­hold­ers com­pris­ing of rep­re­sen­ta­tives of Nige­ria Cus­toms Ser­vice (NCS), Nige­ria Im­mi­gra­tion Ser­vice (NIS), Stan­dards Or­ga­ni­za­tion of Nige­ria (SON), Na­tional Agency for Food & Drug Ad­min­is­tra­tion Con­trol (NAFDAC) and freight for­warders among oth­ers are reg­u­lated and work for com­mon good.

The Ex­ec­u­tive Sec­re­tary and Chief Ex­ec­u­tive Of­fi­cer of the NSC, Mr Has­san Bello, has been lucky to act as a mo­bil­i­sa­tion and sta­bil­is­ing fac­tor to all agen­cies at the port. But the NSC must do more. Be­yond what is in the statute book, there is a need for the coun­cil to har­ness other po­ten­tial ar­eas of the port sec­tor with a view to en­thron­ing real com­pe­ti­tion and bring­ing down the cost of do­ing busi­ness at the Nige­rian sea­ports.

The un­com­pet­i­tive na­ture in the na­tion’s sea­ports, car­goes and ves­sels have, over time, been di­verted to ports lo­cated in Nige­ria’s neigh­bour­ing coun­tries such as Cotonou, Re­pub­lic of Benin, Ac­cra and Tema , Ghana; Lome, Re­pub­lic of Togo and Dakar , Sene­gal.

De­spite di­vert­ing car­goes to th­ese for­eign ports, th­ese car­goes later find their ways into Nige­rian mar­kets through smug­gling. In the end, while Nige­ria loses huge in­come in im­port du­ties, levies and other charges pay­ments, th­ese neigh­bour­ing coun­tries gain.

It is rather strange that as strate­gic as our ports are to com­merce in the African con­ti­nent, our ports op­er­ated only eight hours daily. Fair enough, a 24 -hour op­er­a­tions that NSC in­tro­duced, is a good de­vel­op­ment even though it ought to have come much ear­lier than now. Never again must our ports be al­lowed to op­er­ate the bu­reau­cracy of the civil ser­vice. They must be seen and op­er­ated as busi­nesses to make them the de­sired mar­itime des­ti­na­tions to ser­vice not only Nige­ri­ans, busi­nesses and cor­po­ra­tions in the sub-re­gion.

Avail­able statis­tics from the Fed­eral Min­istry of Fi­nance in­di­cate that about 60 per­cent of goods shipped into West African coun­tries are meant for the Nige­rian mar­ket. How­ever, the poor man­age­ment of our ports has re­sulted in the bulk of the goods des­tined for Nige­ria go­ing through the ports in Ghana and Benin Re­pub­lic.

In­ter­est­ingly, since the NSC took up the lead­er­ship role, we, the port users have wit­nessed tremen­dous im­prove­ment in com­plaint and ar­bi­tra­tion mech­a­nisms; prompt is­suance of Ship Sail­ing Cer­tifi­cate and the con­se­quent avoid­ance of de­mur­rage ac­cu­mu­la­tion against ship­ping com­pa­nies and other ef­fects. This is in tan­dem with in­ter­na­tional best prac­tices.

Ogungbe­san wrote in from Apapa, Lagos

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