Speaking on the impact the terminal operators have made so far in the maritime sector since the ports were concession, Bolaji Akinola, spokesman for the Sea Ports Terminal Operators Association of Nigeria (STOAN), the umbrella body for the terminal operators in the country, said that the terminal operators have done very well in the country.
According to him, to appreciate what the terminal operators have done, “We need to remind ourselves of what our ports used were like and what prompted the government decision to involve the private operators in the ports. Don’t forget before 2006, the totality of port operations were in the hands of Nigerian Ports Authority. But then, we knew there were lots of inefficiencies. If you recall that ships coming to Nigerian waters will have to wait for about 30 days before they would be given access into the ports. If you recall, cargoes were sitting at the yards for over 45 days before they were cleared because they were no cargo handling equipment to clear them. If you recall, there were a group of shipping lines called the European West African Trade Agreement (EWETA). They imposed what was called congestion port charges to Nigerian ports. That congestion port charges amounted to $100 million every year at that time, all because of the inefficiencies at our ports. No cargo handling equipment, there was system failure, highest level of corruption,” Akinola said.
He asserted that the government at the time would appropriate money to acquire cargo handling equipment, but the money would be spent, and the cargo handling equipment would not come in or if they came, they would come in as refurbished and in an unserviceable conditions that were not working.
“There was a whole lot of avalanche and graft and corruption going on in the system,” Akinola said, adding that the government rose up and said we could not continue like that.
He also noted that staff were not trained.
Highlighting the breakthrough of the terminal operators, Akinola said that the first year of their operations, congestion in the ports ceased and $100 million per annum waste was eliminated.
“So that is a huge saving and if you convert it, it will be over N40 billion per annum and a credit to Nigerian economy. So you can imagine, if that congestion port surcharges were not eliminated in 10 years, you will be talking about billions of US dollars now. So operators have paid the country several billions of US dollars on congestion of ports charges alone.”
He said that operators have invested about $1.2 billion over the last ten years to acquire cargo handling equipment, upgrade the port facilities, introduce IT into the system, and train port workers.
“This private sector money, which would have been spent by government, but now, it has freed the government and allowed government to concentrate on providing other social amenities to the people. Vessel queue is now zero, if they come, they go strait to the berth. Before, they have to wait for 30 days. Now it is zero waiting time. Right now, we have zero waiting time for ships. There is no more congestion inside the ports. Equipment, which was not available before now is now available, workers are well trained. There is improved technology in the system,” Akinola stated.
Also speaking, Peter Akintoye Ojo, Chairman, International Freight Forwarders Association (IFFA), Tin Can Island Port chapter, noted that the activities in the ports before the concession era in terms of infrastructure, trade facilitation, ease of doing business and so on were zero, but cheaper in business transactions and charges imposed on importers and their agents.
“There were actually a lot of challenges when the Nigerian Ports Authority was in charge of all the ports activities. There were a lot of bureaucracies, but the concessionaires have invested so much in the ports and their services very efficient. But in terms of cost of doing business, their charges are so high. But in terms of infrastructural development, they have brought in modern equipment which has resulted in efficiency on their own part.”
Ojo lamented that in as much as the terminal operators are playing their own role to enhance efficiency and ease of doing business, the Federal Government has refused repair to play their own roles in several instances. He further lamented the state of the port access roads, which he said were the responsibility of government, saying they have neglected the roads and as such, movement to and exit from the ports have become a thug of war.
He said, in addition to all these with the cost of doing business at the ports, have become the woes of the importers.
The frontline freight forwarder noted that it was painful to pay for services when the services are not commensurable with what you are paying for.
He said that the government ought to have put so many things together to make the ports accessible such as constructing underground roads, constructing flyovers, constructing efficient rail lines into the ports, building modern tank farms and providing truck parking facilities. He said the only port that can boast of rail connection is Apapa port, which he equally posited was not working.
Also speaking in the same vein, Anefi Mohammed, the Vice Chairman of the Ports and Terminal Multipurpose Services Limited (PTML) chapter of IFFA, said that basically, the ports placed in the hands of private operators have achieve about 30 percent efficiency.
According to him, the major problem the importers and their agents now face with the terminal operators is that of extortion.
He noted that high cost of doing business has become the order of the day.
He equally agreed that lackadaisical attitude of government workers placed the ports in a bad shape prior to concession.
“Inefficiency was the order of the day. There were delays here and there and lots of demurrages paid as a result of delays. Also, there were decayed infrastructures in the ports and nobody seemed to care,” Mohammed stated.
Vicky Haastrup, Chairman, Seaport Terminal Operators Association of Nigeria (STOAN), says the successful concession of Nigerian ports made it a model to other countries.
Haastrup said in a statement that other countries were using Nigeria’s model to concession their public infrastructure and urged Federal Government to extend the model to other sectors of the economy.
In the statement signed by STOAN spokesman, Bolaji Akinola, Haastrup commended the government for its foresight in the concession of terminal operations at the seaports in 2006.
“After Nigeria’s port concession, we now have countries like Cote d’Ivoire, Liberia, Ghana and even Greece, adopting our model.
“The Liberians and Ghanaians sent delegations to understudy our port concession model to develop theirs,’’ the STOAN chairman said.
Haastrup recalled that recently, the Greek Government concessioned the Thessaloniki Port, which was one of its most important public infrastructure.
According to her, this is a clear indication of our success as a nation in building models worthy of emulation by others.
“What the concession does is that it frees government resources for the provision of other social services to the people.