The Managing Director of the Nigerian Ports Authority (NPA), Habib Abdullahi, hosted a group of Business Editors. He spoke on many issues, such as performance, revenue and challenges faced by the authority in the light of the dip in oil prices and accompanying policies. Group Business Editor SIMEON EBULU was there.
What are the challenges confronting ports administration?
Any challenge I encountered when I came in is not new to me. There is change of government and with that, there is complete change of ideas. It is not like a similar government. It is a complete overall change of the system. There is challenge, not only in the maritime but in the overall economy. That has also made us to face some challenges. The sector is affected by the policies of the government and we are waiting for government to stabilise the system.
How has the change impacted the policy direction of the maritime sector?
Maritime is dependent on import and export of goods. There is less business now in the ports. That means less revenue to us. We are very much aware that there is challenge of foreign exchange. This is related to revenue of the whole nation. We are highly dependent on oil revenue which has dropped. The year has just started and it has not even started if you look at the fact that the budget has not been approved.
… by what percentage compared to last year’s?
If you look at the number of goods and services that we have, we are less by 10 per cent. In ship tracking, the number of ocean going vessels has dropped to 5900, representing a decrease of 8.1per cent from 50000 in 2014. If you look at this tracking, you will see the effect on traffic.
How are you trying to reverse the trend?
We have to go with the government’s thinking, and that is diversification of the economy. What we are trying to do is to encourage export and be less dependent on oil. We have written to the Federal Ministry of agriculture and the Nigerian Export Promotion Council. There are quite a number of empty containers. If only we can encourage people to export, (people are exporting yam), and other resources. We can diversify into Agric. That is one of the areas I think we can diversify and complement the revenue we are losing.
We have to work hand-in-hand with Concessionaires, at the same time, we are trying to work with the Customs. We are trying to see how to make Ikorodu an export terminal. This is just an example. We have the Ilaje Port in Ondo State. Quite a number of people are coming and showing interest.
It would appear the Lagos port is always congested?
A number of people don’t understand our operation and role in the maritime sector. I don’t tell people that when they are bringing goods that they must use Lagos ports. It depends on you the importer or exporter, not me. More especially now that all the ports are being concessioned. We are just landlord and we are only building infrastructure. We are doing that in all the ports. It’s left for government and concession-aires to encourage people to deal with them, but people just decided to use Lagos despite the traffic.
Instead of people to use Calabar, (of course there are some problems there), but Onitsha is deeper than Lagos, and we have Control Terminal there.
The infrastructure – access road to Lagos port remains an issue. How are you dealing with that?
I have to re-educate the public. It is not our responsibility to improve access roads to the Lagos port. I wish it were, but it is disturbing. Anything that happens it’s the NPA but access road is the responsibility of the Federal Ministry of Works and the Lagos State government, as well as the local government. Last year we spent about N500million in order to show our Corporate Social Responsibility. We did some emergency interventions to make life easier for port users, but it’s not our responsibility. The only thing we can do is within the port. We are trying to do similar works at Tin Can. Currently, the Federal Government is giving a contract for the Oshodi/Apapa road.
Operators have expressed concern that the ports are nor served with railways. What is the position?
That is our responsibility. Inter-modal transportation is one of the key issues. If the railway is working as it used to be, all these congestion will not be. You remember, the railway within the port, we did that and it is 93 percent completed. That of Port Harcourt is almost completed. We are developing that infrastructure. We are waiting for the Nigerian Railway Corporation to complete the rest outside the port. That is why the government is making it a priority.
How are you reducing cost of doing business?
People say the cost of importing is high here but compare it to the rest of the world. Look at it and see it. The issue is not what a lot of people think. We have about five applications to set up port. Why are they applying if the port here is expensive! but it is not, it is because smuggling is going on?
Shouldn’t NPA look for other ways of generating revenue rather than collecting rent?
Who told you that it is easy to collect rent? Even to collect that rent is very difficult. It is not as easy as you think. Don’t forget, we have responsibility. We can’t go outside our mandate. It is not only rent collection that is the source of our revenue. We have cargo dues, shipment dues, pilot age dues, and we are trying through our own ways to see how we can expand and come up with few things. We have parastatals within the NPA. We need to have a reorientation.
The Finance Minister said some revenue agencies are richer than the ministries but that they still wait for government’s subvention. Why?
Let me correct this. We don’t collect subvention from the government. We are a self-sustaining agency and are expected to even give the government money. If you ask the Minister of Finance, she will tell you that NPA is one of the agencies living up to its responsibility. It is not because we like to give the government money; it is because of Fiscal Responsibility Act. For the first time in 2012-2013, we remitted N15 billion to government. The highest that was ever remitted was N2 billion. I will give you the figures to see how much we have given to government.
Are you exploring some dormant areas?
People forget something. Seventy-five per cent of Customs collection is from the maritime sector, according to the Controller-General.Whatever we collect as well, is part of maritime. The revenue being collected taxes, somebody can sit down and see how much we are giving. People focus on very small aspect, but I agree with you we will do more. If you look at it from that end, Maritime sector is huge, but it cannot exist on its own. But the sector thrives on government policy, trade policy and transport policy, among others.
Why is it difficult getting the rent from the concessionaires?
First of all, business like this is continuous. Every month, every quarter, every year, we sit down and review and reconcile and collect the money. There are different kinds of revenues and funds you are suppose to collect from them. Now because of the challenges that we started with, the question of deposit at the initial stage of TSA, we had challenges; question of forex from those we have agreed to pay in forex, so there are all these challenges that we are trying to deal with. On the concession, some of these concessionaires when they took over have dual responsibilities. We have some responsibility and they have theirs. Part of our responsibility is port development which we have to do.
For instance, some of them want their quay side which has been there for more than 60 years in Lagos, developed, some are even collapsing, but we can’t do everything at a go. But these guys feel why can’t they do it and when they do it, instead of them to wait but they will say, let’s do it and give us one-to-three years to collect back our money. And it’s because of that we write to the Ministry of Transport, the Federal Executive Council, to the NCP (National Council on Privatisation). So it is NCP that gave this exemption, based on our recommendation. They have to come and confirm, but in order for them to recoup their money, we had to extend their period to one, two to five years.
Has the port concession arrangement paid off?
Yes. Hitherto,people come in; they want to repair one thing or the other and it was not done as efficiently. That is the whole essence of port reform. By doing that, the government becomes more efficient. Your port of operation becomes more efficient. Yes, the problem has increased; people have to go out now to look for market, that is, the concessionaires. This increases the volume of business year-on-year. Even at this crucial time, what we collect is even much higher than what we collect before. To say that the concession is not a success I disagree with that, but we can do much better. I have written a letter for a review of all the concessions to address some of these challenges from our side and their side.
The volume of containers that are still in the ports, we thought when the Inland Ports were established, it will reduce the volume, how effective is this?
You remember the impact of the terminal port in Kano, Kaduna, Ibadan and Enugu. I could remember the impact of the port in the North because I grew up there. Now that huge container terminal, it was the railway that was transporting the containers. Now, the place has been given out. People are building houses there. It is very unfortunate. Why? It’s because its responsibility is taken over by some agencies. It used to be under NPA that is the inland container. It’s no longer under us.
Why?
It’s the government’s decision. They said we are a technical regulator, that is what it is. The government has approved that. So, we are an economic regulator.
What’s the relationship between the NPA and Private Jetties?
There is a Presidential Committee on private jetties and NPA is a member of that Committee.
