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Tag: TINAPA

  • Tinapa: The jewel returns?

    Tinapa: The jewel returns?

    While the news of its ‘resurrection’ may not have competed with others on the front pages as it ought to in some respects: yet, it needs to be said that something happened to the once-famous jewel in the Cross River economic firmament on November 7 that is deserving of a more than a passing attention. On that day, Tinapa, the multi-billion naira complex that once projected the state as a potential global powerhouse of business and tourism was finally repossessed from the Asset Management Corporation of Nigeria, AMCON.

    This was how an elated Cross River State Governor, Bassey Otu captured the moment: “Today’s event has finally removed the legal lacuna on the ownership of Tinapa, which is now the bona fide property of the Cross River State government…We are not only reclaiming the facility, but also increasing the stock of our enduring infrastructure. The return of Tinapa is not merely an event; it is a rebirth, the triumph of faith, patience, and resilience…This is more than reclaiming an asset; it is the revival of a vision that once placed Cross River on the global economic map”.

    Talk of the resurrection of a dream long given as ‘interred’; something of an eight wonder in the world!

    Governor Otu and his team not only deserve commendation for retrieving the complex from the hand of the undertaker – the Bad Bank better known as AMCON, but refusing the Tinapa dream die. With good structures properly deployed going forward, there is yet a chance that the state might yet recover not just the value already poured in by way of investments and goodwill, but possible realignment with the founding ideals which the receivership may have aborted along the line.

    Yet, if the truth be told, the story of how the 265 hectares property Leisure Resort, situated in Adiabo on the outskirts of Calabar, originally conceived by the Donald Duke administration to be a world class tourism, investment and leisure hub, whose breaking ceremony was performed in 2005, fell into the hand of the ‘Bad Bank’ deserves to be fully captured if only for its enduring lessons. A typical misshapen that is peculiarly Nigerian; on the one hand is the tale of a business ecosystem whose processes are more often than not, a recipe for failure; and on the other is the issue of continuity that has remained the bane of governance in these parts.   

    Tinapa’s problems were said to have started soon after the inauguration of the first phase of the resort in 2007. First was the issue of its legal status as a free trade zone, when only the federal government could operate a free trade zone. Liyel Imoke, who succeeded the visioner – Donald Duke, had, reportedly appealed to the federal government to take a stake in the project and to remove uncertainty about its status said to be hindering investment, all to no avail. Convinced that private investors could do at least a better job of putting the project on track through capital injection and managerial expertise, his overtures to them also reportedly hit a brick wall. While these were going on, the Nigeria Custom Service would insist on charging duty on purchases as they were brought out of the zone thus rendering businesses in the resort generally unprofitable. Of course, it was a matter of time before the shops within the complex started drawing the shutters, with other facilities such as the exhibition space and movie studio soon following!

    To compound this was the issue of mounting debts, which at some point climbed to N18 billion for a state that was resource-challenged. Realising that the burden had become too much for the state to bear, the then governor, Imoke was said to have turned the resort over to AMCON; (the latter expected to inject about N29 billion to revive business activities in Tinapa before inviting investors to take over majority shares). That, as it turned out, never happened. Imoke’s successor, Ben Ayade, unfortunately did nothing to help the situation and so Tinapa’s fortunes further dipped. The final damage came with the EndSARS protest of 2020 during which damages said to be in excess of N100 billion were recorded.

    That was the mess that the current governor, Bassey Otu, met on ground. Evidence that the governor has been working round the clock is the seal marking the repossession of the facility.  Now the governor can claim that his quest to restore trust among investors and his government’s readiness to drive socio-economic renewal is well on course.

    However, as I noted earlier, that act, of restoration that is, in itself can only be the first step in the journey to the resuscitation of a dream that was nearly aborted. To be sure, the achievement ought to be seen beyond the mere premise of increasing the stock of strategic infrastructure available to the state, (which is important), but rather in terms of how much value it will be able to deliver to the state and its people in terms of jobs and value creation across the board. That seems to yours truly, the best validation for the restoration of the complex as bona fide asset of the state government.

    Read Also: Seasoned artistes often get sidelined in Nigeria – DJ Neptune

    Yet, true as the words of an observer is, that the repossession marks a decisive step towards ending years of redundancy and abandonment, the big task in my view, which is one of actualising the original vision of Tinapa as a transformative business and leisure hub, is still, at least at this point, a long way ahead.  

    Notably, the government is said to be in discussions with potential partners in the agro sub-sector and manufacturing, to demonstrate Tinapa’s renewed attractiveness. Surely, the good people of Cross River cannot wait to see the fruits of the engagement blossom. Even in this, it seems to me also that the Bassey Otu administration would need to provide further clarification on what this means in concrete terms to potential investors, particularly in those areas they might wish to collaborate with the state government. 

    Surely, it is one thing for the state to have crawled out of the clutches of the creditor, ensuring a vastly improved business environment is however a different kettle altogether. In other words, the other question of what has changed in the status of the complex remains largely unanswered. As it is, one expects that the experiences of the past years will guide the state government in coming up with a direction, going forward. That way, the state and its people wouldn’t have to relive the nightmarish date with the Bad Bank.

  • Lessons from Tinapa

    Lessons from Tinapa

    While giving credit to the vision of a former governor of Cross River State, Donald Duke to make the state the business and leisure hub of Nigeria, nay West Africa, especially with regards to the conceptualization of the Tinapa project, it must be pointed out from the onset that Tinapa was birthed without due diligence. A flagship project of such magnitude was conceived with little or no consideration for location, anchor tenants, access infrastructure, legal and regulatory framework and sustainability plan. A project with a cost outlay of about $600 million intended to divert traffic that constantly left the shores of Nigeria and even other West African countries, to places like Dubai, to Cross River State, was conceptualized without proper feasibility report. By law, a project of such magnitude was not supposed to be spearheaded by a state government. The supposed model in Dubai, the United Arabs Emirate from which Tinapa is derived is owned by that country, not a province or state government.  At least, the Cross River State government ought to have gone into partnership with the federal government in the Tinapa project. But this was not to be.

    The Tinapa case is even more beguiling than it appears to the general public due largely to media hype. We must admit that Tinapa was built without anchor tenants. International best practice demands that you secure anchor tenants even before the foundation is laid. Before you bring a tenant like Walmart, for instance, to Tinapa, you ought to have had an agreement or even a Memorandum of Understanding (MoU) with them. If you had wanted Walmart to come, you would not have opened your door to T-mart in the first place. If there was need to stop Walmart, then T-mart would not have been given opportunity. And how well did T-mart do in Tinapa? From investigations, it was T-mart that drowned Tinapa. Walmart and other retailers discovered that Tinapa was not suitably located and did not have any clear operating or regulatory framework; they realized that the Duke administration didn’t take into consideration some critical elements from the onset. It was touted as Public Private Partnership project, but now, everybody knows that the burden of Tinapa is being borne by the Cross River State government which was made to pay a debt of N1billion monthly inclusive of another N200million maintenance cost with literarily no inflow.

    From our findings, it was the succeeding administration which got the operating licence for Tinapa in 2008/2009, when the Customs operating regulations were approved. The simple truth is that Duke touted Tinapa as Nigeria’s Dubai when, in fact, as a governor, he could not in any way change or amend the constitution or the fiscal policies of the federal government. All Duke did was put massive warehouses and line shops in place at the expense of the taxpayers. Secondly, when Tinapa was commissioned, the hotel, water park and studio were not ready. One of the first things the succeeding administration did was to get a loan of N3billion specifically to complete those outstanding projects in Tinapa. In fact, the hotel became operational during Imoke’s tenure. Imoke even introduced a new conference facility in Tinapa, even as he introduced a children amusement arcade all in the hope of bringing in some traffic to the complex. Imoke made offers to companies like Silverbird to take over the studio but Silverbird refused. Imoke made offers to Shoprite, and all of them said Tinapa was wrongly located; that Calabar did not have what it takes to bring business to Tinapa. Indeed, the failure of Tinapa is not due to lack of effort. Very clear effort was made by the Imoke administration including the completion of the studio and signing of an agreement with Ebony Life TV, which today is operating from Tinapa.

    Tinapa was without electricity. The Imoke administration ensured that power supply was brought there, and everything else at the cost of billions of naira. But someone would have Nigerians believe that Imoke ruined Duke’s efforts. This is because Imoke is media shy and does not talk. Were it not for the fundamental failure inherent in the structure of Tinapa, Imoke’s effort would have been enough to jumpstart the project. It was Imoke who approached AMCON and actually signed the AMCON agreement. It was the Imoke administration that went through the whole arrangement of inviting AMCON, sitting down with them, negotiating the agreement. Imoke’s greatest mistake was that in an attempt to shield his friend and predecessor from public odium and disgrace, he tried to deodorize the white elephant project called Tinapa which Duke used to attract headlines. Yet, unfortunately, while Imoke was in office as governor, Duke tried to stop AMCON from concluding the transaction through subterfuge and blackmail. Duke is now trying to conclude it with the new governor, Ben Ayade.

    Duke has made reference to Imoke not wanting his projects. By the way, what business has a state government operating a commercial entity? Duke ended up making the state to bleed from a project that was not well designed. Even when KPMG, the consultant, was asked how come they were a consultant to such a white elephant project, they said that what was developed was not what was recommended. The truth of the matter is that all effort was put in, resources mobilized to make Tinapa become operational. That the studio is working, the water park, the children amusement arcade functional and the Tinapa Hotel operational, is to the credit of the Imoke administration. Again, that nothing has ever stopped anybody from coming to do business at Tinapa was because the Imoke administration offered rent-free accommodation to tenants at Tinapa just to attract traffic to the complex. But a number of things hampered the operationability of Tinapa. It was developed as a Free Trade Zone which is on the exclusive legislative list by a state government. Even the regulation was got by Imoke. Duke as a governor built the infrastructure of Tinapa without operating guidelines; without any regulations and without any tenants.

    It also behoves on Nigerians to know that according to the plan, the Calabar channels were supposed to be dredged but was outside the control of the state government; the federal highway was supposed to be dualized and the airport was supposed to be expanded. These were also not at the control of the state government. So, all the critical elements that would have been put together to give Tinapa a small chance to grow were outside the control of the state government. Now, how would a governor undertake a project in which he has no control over its critical success factors with such huge amount of taxpayers’ funds? All the success factors of the project were outside the control of the governor and government. He (Duke) should admit that the Tinapa project, from inception had failed. If there was any government that made effort to advance Duke’s legacies, it was the Imoke administration.

    Again, from findings, the Monorail was the last project Duke abandoned. But, today, in spite of the lean resources at the disposal of the Imoke administration, though some of the monorail parts had been ordered, Imoke deployed those parts and brought in the monorail itself, to link Tinapa and the City of Calabar across the Tinapa Lake. There are also other projects which Duke did not complete that Imoke completed. One of such is the Lemna Road. He did not complete it; Imoke finished it. The Tinapa Road was a one-carriage way. Imoke dualized it. In fact, Duke started the Calabar Carnival. But Imoke took it to the global annual calendar. Whereas Duke attended only two editions of the Carnival, Imoke attended eight and brought it to the living rooms of viewers across the world. The same goes for the Obudu Mountain Race. The lesson of the failure of Tinapa is a hard lesson in development: that no government should ever risk the taxpayers money in venturing into any business without due diligence. A government which goes into any project without the control over the necessary fiscal policies and other critical success factors is bound to regret its action while leaving the impact of the failure on the tax payers. In fact, governments have no business being in business.

     

    • Michael, an economic analyst, wrote in from Lagos.

     

  • Cross River: Tinapa now a wasteland

    Cross River: Tinapa now a wasteland

    BEFORE Donald Duke became governor of Cross River State in 1999, it was not a place really talked about or where people wanted to go to. Tucked away in one corner in the southernmost part of the country and not a thoroughfare to any other part of the country, anyone who visited the state had something very important that could bring him there. It was largely regarded as a slow and dull civil service state, where everything moved in a lull.

    But when Duke came in, with drive, energy and style, he managed to pull the state from the doldrums to a place where everybody talked about and wanted to visit. The state, despite its geographical location, suddenly became a destination for visitors within and outside the country. Duke introduced programmes and projects to sustain the tempo of the hub the state was suddenly turning into. An example of such programme is the famous Carnival Calabar, which has continued till present day, though many feel, with falling standards. Also among several projects embarked on by the then governor for this aim, Tinapa was the flagship. The aim of Tinapa was to make Cross River State the business and leisure hub of West Africa. Duke’s vision was to divert traffic that constantly left the shores of the country and even neighbouring countries, to places like Dubai, to the state, and thereby boost its economy and that of the country at large. It was to be a place where people could shop, do business and have fun in a pristine and serene environment.

    Presently, the project, which is said to have cost about $600 million, leaves so much to be desired as not only has it failed to achieve its aim, but it also appears to be dying a very slow and painful death. At the moment it lies desolate and wasted with weed growing wildly everywhere.

    The massive project has variously been described as a white elephant project, but many feel the subsequent administration was not as committed to the vision of the project, hence hampering the level of development it should have achieved by now. However, others feel the subsequent administration of Liyel Imoke did its best to get the place working, but had to contend with forces like the Customs and other business and political interests, which stifled the growth of the resort and left it fallow the way it is today. It was during Imoke’s tenure that the resort was gazetted. The former governor tried to breathe life into the resort by coming up with another mega project known as the Summit Hills, which consisted of a world class International Convention Centre and other cluster projects, housing estates, a golf course, a hospital, among others to draw traffic to the resort. He also linked up the Summit Hills to Tinapa by a monorail to increase the appeal of the project. Of all these however, the only functional ones today is the convention centre and the about one kilometre monorail, which is rarely in use.

    In a recent interview Duke was quoted as describing as “childish” the way subsequent governments in the state have handled the project, instead of building on the blocks already prepared that would eventually lead to the development and benefit of the populace.  Many believe he was expressing his displeasure at how subsequent administrations had abandoned the vision that brought the state out from the abyss of nothingness to the new status it enjoyed.

    The groundbreaking for the Tinapa project was performed in Adiabo on the outskirts of Calabar in 2005.

    The project site, measuring approximately 265 hectares of land, was on the 15th of August, 2006, declared a Free Trade Zone by the President in pursuant to the provisions of Section 1(1) of the Nigeria Export Processing Zones Act No. 63 of 1992.

    Facilities available at the Tinapa Resort include a pre-built retail and wholesale accommodation amounting to an excess of 65,000m2 lettable area composed of Four Emporia of 10,000m2 each, several Line Shops, Warehouses, and so on; an Open Exhibition Area for Trade Exhibitions and other events; an entertainment strip that comprise spaces for a Casino, an Eight-Screen digital Cinema, vintage international standard restaurants, a night club and pubs; an entertainment Centre with a functional Games Arcade and a mini amphitheatre.

    Others include an artificial tidal lake that feeds from the Calabar River which itself flows into the Atlantic Ocean, where water sport activities, including fishing, can be undertaken on the Tinapa Lake; a man-made beach where leisure events can be held, a two hundred and forty two  rooms international three star hotel; a movie production studio known as “Studio Tinapa”.

    Also, there is a Water Park/Leisure Land comprising a collection of children and adult size pools, water slides, a wave pool-surfers delight, a lazy river as well as a bar and restaurant; a parking space for about four thousand cars; a truck terminal; a Helipad; an independent power plant that ensures adequate and uninterrupted power supply to the zone; over six kilometres of perimeter fencing with a good security network; over 15 kilometres of underground piping for sewage and storm water; a sewage treatment plant; and a dedicated Police post that provides security for the zone along with a team of private security organisations, among others.

    On April 2, 2007, the resort was commissioned amidst high hopes of rapidly transforming the economic fortunes of the state by an expected explosion of activities.

    This was not to be as in the first couple of years the resort lay fallow. Acerbic criticism trailed investment. Proponents of the project attributed the lull to the lack of a gazette on the operational regulations, policy and guidelines of the zone. The gazette through the efforts of the then Managing Director, Bassey Ndem, was ratified by the National Assembly after so much political horse-trading in 2009. Then, after a brief lull things began to pick up for the resort.

    Investors’ presence in the zone started to swell in the zone. Leisure activities there also witnessed an explosion, with the water park; arcade and others getting an unprecedented number of customers.

    The resort was even generating revenue for the state as the management then said the hotel alone was generating up to a N100 million monthly for the government.

    Although it was still a far cry from its potentials, at least things got better until sometime in 2013 when a spanner was thrown in the works, following the alleged deliberate delay of goods meant for the resort by some customs officials at the Onne Port in Rivers State.

    Some of the tenants in the zone, who have been using the Onne Port for transportation of their goods to Tinapa and the Calabar Free Trade Zone (CFTZ) complained that they have been experiencing unnecessary delays in the clearing of their containers. Findings revealed that Customs insisted that duty must be paid for Tinapa bound goods, a development which did not go down well with the investors as they said that since they were operating in a Free Trade Zone, they were not bound to pay such duties. The situation worsened until it squeezed the life out of the resort as investors left and turned the place to a ghost town. This, coupled with what has been perceived to be the lack of proper attention and political will by the government, has left the resort in the state it is today.

    Like Tinapa, it appears the vision of Duke to make the state a hub is also plummeting, as there has been a considerable drop of visitors and activities, thereby tightening up the economy more.

    However, optimists believe there is still light at the end of the tunnel for the dying giant as there are talks of the Assets Management Corporation of Nigeria (AMCON) taking over the management of the resort.

    “AMCON is coming in to reboot the place. From that standpoint, there is hope. AMCON as a Federal Government agency would be able to deal more seamlessly with bottlenecks that may arise with conflicts with other Federal Government agencies as the Customs, with NEPZA in the middle. There would be better synergy. Hopefully by 2018, AMCON would have concluded arrangements to take over and the place would come back to life. The entire idea of getting the place to make Cross River State a hub is just the first phase of a three-phased project. Fortunately the infrastructure is still intact because they were done to world class standard. So all hope is not lost,” a source said.

  • TINAPA woos local businesses

    TINAPA woos local businesses

    The Management of TINAPA Business Resort Calabar says it is encouraging local businesses to own shops and business outlets to boost activities in the resort.

    Mr Ayiba Ayiba, Managing Director of the Resort, told the News Agency of Nigeria (NAN) on Sunday in Calabar that this was part of measures to resuscitate business activities in the resort.

    “We are doing everything humanly possible to ensure that TINAPA works. We are trying to explore our local markets.

    “We are trying to encourage our local traders to come and rent our shops and do business with us.”

    He disclosed that there were 54 shops in the complex and not more than 10 were currently occupied.

    According to him, facilities at the TINAPA Water Point were also being resuscitated to make them functional, adding that a borehole had been put in place.

    He blamed the lack of activities at the point to poor water and epileptic power supply.

    “We have sunk a borehole and water tanks are being installed as alternative water supply to the pool. This will take care of regular water supply to the pool and keep the toilets clean.

    “Also, we are making efforts to provide alternative power source to ensure regular power supply to the pool, as this is one of the biggest challenges facing the resort.

    “So I am assuring tourists that by the first week of October our pool will be functioning normally,” Ayiba said.

    He also dismissed online reports which alleged that the Monorail linking TINAPA with Calabar International Conference Centre (C ICC ) had been paralysed due to stealing of its armoured cable by hoodlums.

    According to him, the monorail was in perfect condition, but was not functioning because there were no passengers to be transported.

    “The monorail is in perfect condition; nothing has happened to it but presently there is no patronage.

    “Whenever we have passengers we call the engineers to put necessary things in place for its use.

    “So the rumours making the rounds is baseless and untrue,” he added.

    Ayiba stressed the need for the state government to re-constitute the TINAPA board to facilitate the current investment drive going on in the resort.

  • Ayade sacks Tinapa MD

    The Cross River State Governor, Prof. Ben Ayade, has sacked, with immediate effect, the Managing Director of Tinapa Business and Leisure Resort, Mrs. Francisca Effiom.

    A statement issued by the Chief Press Secretary to the Governor, Mr. Christian Ita, on Wednesday said the Commissioner for Finance, Mr. Asuquo Ekpenyong (Jnr), will now head the resort management team.

  • Tinapa owing N79b, says Cross River lawmaker

    The Tinapa Project, initiated by former Cross River State Governor Donald Duke, left a N79 billion debt for the Liyel Imoke administration, the Chairman of the House of Assembly Committee on Finance and Appropriation, Dr Jake Otu Enya, said at the weekend.

    Enya addressed reporters after various ministries, departments and agencies (MDAs) defended their budgets before the Assembly.

    The lawmaker said the Tinapa debt was just one of several inherited by the former administration.

    He said the financial problems faced by the government today were because of the huge debts it inherited.

    Although Enya did not give a figure on how much the state owed, he said it was within manageable limits.

    He said: “The debt profile of Cross River State did not start from today. We inherited from the former government. I was the chairman of the panel set up by this House to investigate the activities of Tinapa. I went into it for two to three months and presented a report before this House. We know the level of indebtedness as at when the last administration left office. Most of the financial problems we have today are the result of that indebtedness of about N79 billion as at then for Tinapa alone.

    “We had other debts, which were deducted at source from the Federation Account. We have the problem of Bakassi. All of you are living witnesses. We had a problem of the 76 oil wells that left Cross River. If not the instrumentality of the present administration it would be very difficult.

    “It is quite unfortunate that we are trying to see how best to bring in the best financial management policy that will actually reposition Cross River State for the interest of all. People will not even ask how Cross River State government is paying salaries but they are very anxious to know why the state is owing salaries for one month or two as the case may be.”

  • Tinapa as modern-day Trojan horse

    SIR: The Tinapa Resort is like the Trojan horse in as much as it was presented to the people of Cross River State as a potential booty, a boon to their long-suffering people, by former Governor Donald Duke, who conceived the project. With Tinapa as the decoy, doors were opened to allow treasury raiders to clean out the coffers of the state. On top of that they slammed a multi-billion naira debt on the state to rub in the insult, and smiled all the way to the bank themselves.

    But what was the promise? Duke held up Tinapa as the magic wand that would generate investments and jobs while rivalling Dubai as a tourist destination: “We want to build the 24 kilometre high-speed monorail to link Tinapa,’’ Duke had chirped at the beginning.”My vision is that by year 2010, Cross River State will be the centre of tourism in Nigeria and that explains why our investment in tourism in the last four years has been the highest in West Africa.”

    Duke did go a bit further to try to outline this vision in more concrete terms: “Tinapa is free trade zone that will have a lot of facilities akin to what is in advanced countries. We’ll have massive super stores like Walmart. It’ll have Casinos, recreation parks and other facilities that will make it unnecessary for Nigerians to want to travel abroad for vacations. How it will work is that as soon as passengers alight from the plane, they get into the monorail and from there straight to Tinapa Resort.”

    How was Tinapa funded? From 2005 to 2006 a total of more than N600 million was withdrawn from the local governments account run jointly with the state government for the purpose of funding Tinapa. Initially it was estimated that the project would cost N25 billion and then later escalated to N65 billion. Money accruing to the state from federal allocations was deployed as well on the project in addition to additional debt in the form of bonds sold to the public and loans taken from banks to fund it. Ultimately more than $600 million is estimated to have been expended on the Tinapa project.

    Seven years later after Tinapa’s establishment, what happened to the vision? It was stillborn, never quite flew despite all the stage-managed applause. The prime beneficiaries appear to be those who won the contracts and those who awarded, probably. Obviously much thought didn’t go into building it, or rather the motive was more to build a Trojan horse and a functional project was never in the plan. The cart went well ahead of the horse.

    Where did you ever supply a good long before demand is anticipated talk less being effective? Industries needed to be in existence and thriving before you could cluster them into a free trade zone to take advantage of better terms. Therefore, such a project might have been more viable in the Lagos axis with proven industrial capacity rather than sleepy Calabar.

    Among the many fuzzy headed issues surrounding the project is the fact that the structure of its original ownership remains unclear. Whether Tinapa was public or a private investment was never quite made clear and the terms under which funds belong to Cross River State local governments got sunk into the venture were never made clear.

    The consequences of such deliberately poor vision is that today the Tinapa Resort is a lonely desolate place, of no good to anyone except those who conceived it and milked it. It has been handed over to an undertaker called AMCON for the purpose of disposal. Of course, the people of Cross River State never needed a resort where they would shop. They have more pressing needs. How anyone could conceive such a waste as a solution to their problems must rank among the most macabre of thoughts. Think about the opportunity costs $600 million would have given the citizens of the state in news schools, hospitals, roads, scholarships for its students, school feeding in the rural areas, dispensaries and health centres in the more remote areas, agricultural extensions services for poor farmers to help boost their productivity.

    And to imagine that from this Trojan horse called Tinapa Resort and similar projects have emerged people who came into public office from two-bedroom flats in a modest suburb of Lagos and left with mansions in major cities across Nigeria and the world. Is it fair that such people walk the streets as free men, enjoying their loot, while those they raped and plundered are left to await new despoilers?

     

    • Ime Henshaw,

    Calabar, Cross River State

  • Dying businesses of Cross River

    Dying businesses of Cross River

    Calabar, the Cross River State capital, and other towns around are witnessing a lull in business. The multi-billion naira Tinapa Business and Lesure Resort is not left out of the bad times, reports NICHOLAS KALU, Calabar 

    A few weeks ago, the new Area Comptroller of the Nigeria Customs Service (NCS) in charge of Akwa Ibom, Cross River and the Calabar Free Trade Zone Command, Bamidele Akande, visited the Cross River State Security Adviser. The visit was to familiarise the leadership of the command with the state government and seek ways of collaboration for the benefit of the people.

    Akande pointed out something that appears a lot of people will rather sweep under the carpet. He said businesses were dying in the state.

    He expressed concern over the lull in economic activities. He said with a viable seaport, businesses should be booming. He urged the state government to do something about the situation.

    The Tinapa Resort, he pointed out, is also suffering, adding that due to the situation, some investors were already making plans to move elsewhere.

    Several reasons have been adduced for the situation, but topping the list are the shallow Calabar channel and the terrible condition of link roads, especially the Calabar-Itu federal highway.

    Akande said: “We have identified some key factors in the lull in economic activities in the state. The bad road is one of them. We have seen that the government is doing very well in terms of providing good roads within the city, but the problem is the road linking the state to other states is the main problem. They are very bad sections and this is really affecting economic activities in the state adversely.

    “The road is a serious problem as we have been in touch with business men in Abia and the neighbouring states but they complain that they cannot come here to do business because of the bad road.

    “Another problem here is the dredging of the Calabar Channel. This is another cause for concern and something should be done about it urgently.”

    A top official of the Calabar Free Trade Zone, who pleaded for anonymity, said the zone felt highly challenged because of the constraints against the proper kick-off of economic activities in the state.

    The official said goods destined for the zone as well as Tinapa have to berth in Onne in Rivers State for onward movement to Calabar, a situation, he said, has created several logistic problems for business.

    He said: “Calabar Free Trade Zone feels highly challenged because the roads leading from Onne, which is the nearest port to Calabar, is something that needs urgent attention. It causes great discomfort for our people to bring in their goods or take out their goods. The Calabar Port that is among the oldest ports in Nigeria, which has got a lot of history behind and it is attractive to shipping lines. We have been told of so many reasons why it is still not working, but we are still unable to understand.”

    He also identified electricity as another major challenge. He said: “After road and port another major infrastructure challenge is the availability of electricity. We hope that with the privatisation of the discos maybe we would now start solving the problem. We want to say that Calabar as a growing industrial city should receive priority in terms of allocation by the transmission companies. If we have electricity there would be enough to encourage people to come and settle. The problem is the investors would say they would not come because no power. The power companies would say well there are no people who are consuming. We have to start from somewhere. We have people who are interested in coming here to establish and generate their own power, but also we have limitations in terms of the gas supply.”

    The chairman of the Cross River/Akwa Ibom states branch of the Manufacturers Association of Nigeria (MAN), Elder Iniobong Jackson, decried the situation in an interaction with reporters recently. He urged the federal and state governments to engage the private sector in repairing the deplorable Calabar-Itu Highway.

    He believes the road requires a complete overhaul and government needs the input of the private sector in this regard.

    Jackson, who is also a Calabar industrialist and Chief Executive Officer of Jackson Devos Enterprise, said it would not be out of place for the government to re-introduce toll gates on the highway, so far as its proceeds are used to maintain the road. He said the road is very important to the state’s economy and should be prioritised by the state government.

    He also rued the Federal Government’s failure to dredge the Calabar Sea Port even when others in the country are frequently being dredged.

    Describing the state of the Calabar port as pathetic, he said: “Most of us in the Free Trade Zone usually have our goods coming either through Lagos or Rivers State ports.

    “No shipping line is effectively operating this route because they say there is no adequate traffic, and this makes the cost of production higher.”

    Elvis Masor, the Managing Director of the Ugonabo Trading and Logistics in Tinapa, told Niger Delta Report that he would leave Clabar as soon as the goods he has are sold out. According to him, there was no need continuing to stay and incurring losses as economic activities were not moving as expected.

    He said: “You can see there is no traffic. You can stay from morning till night. Virtually we don’t make sales again. Basically it is actually the major problem we are having because what really do is importation and this is known to be a free zone and most of our customers who come from other countries when they come they get some embarrassment from customs discouraging them from coming in to buy. Our mode of importation that we feel could be addressed in future. We are expecting that the Calabar seaport should work, because during our importation, we bring in from Onne in Rivers meanwhile Calabar is the final destination. Goods coming in from Rivers would still be on transit to Tinapa. Had it been the Calabar Port is working, it would have also gone a long way to salvage most of the problems we have as a free zone.

    “If the business is flowing we would recoup the expenses we have made but now it is not moving, we have been affected. The road is the only means and it has been another factor affecting us. Most of those goods are not insured. They use to fall on the road and once they fall, then some of them get damaged. All boils down to the fact that if this seaport is working, it would go a long way to help us salvage the problem.”

    For Kingsley Ihenacho, the General Manager of Ecomarine (ECM) terminals concessioned to manage the Calabar Port for 25 years, the non-completion of the dredging of the channel to the advertised draft of 9.4m meters is the biggest threat to the development of the port with adverse effect on their financial projection and cargo throughput which was predicated on the completion of the dredging as assured during the concession exercise.

    “The drop in performance in general cargo and container volumes shown above are purely affected by non-completion of dredging and pull-out of container services from Calabar(by Maersk line). This is in spite of ECMT’s huge investment in this sector of our operation (in terms of equipment purchase). Also, with the withdrawal of Baco Liner services in Nigeria, Calabar port is completely without a container service. At the moment, all the cocoa exporters are trucking to Lagos for consolidation and export at the expense of the government of Cross River State in terms of revenue and to the port in terms of cargo traffic,” he said.

    Also commenting on the road, he said: “There is an urgent need to fix the bad roads leading out of Calabar. On completion of the dredging, the envisaged increase in container business may not be realised as the bad road will still prevent the importers from the South-East and North-Central states from bringing in their cargo through Calabar which was built to service the importers/exporters from these areas. We request the Federal Government to assist in addressing this impediment.”

    The net effect of the constraints, he said, has led to the non-calling of container ships to Calabar and has affected negatively forecasted cargo volumes upon which their development plan was hinged on.

    “Hence the company is basically thriving on low hanging fruits while hanging on awaiting the Capital Dredging of the Calabar River Channel. Negligible import container and general cargo volume due to the non-calling of the Container vessels to Calabar Port has consistently depleted our revenue base thereby impacting on our desire for backward integration.

    “Our major clients, such as Flour mills, Unicem and Dangote etc do not presently enjoy the economy of scale in their vessel nominations to Calabar due to the fact that their full load arriving vessel has to lighter off some cargo tonnage in Lagos before calling Calabar Port due to draft limitations. Hence, a cargo ship load that could have come at once per voyage ends up being conveyed down to Calabar Port in two or three voyages. This increases their operating cost and by extension cost of the end product from the end-users position. It also leads to capital flight out of Nigeria. This makes these companies less competitive.

    We have equally lost several business prospects like a fertilizer Company- Nargajuna and several Ro-Ro. Shipping companies that could have been plying their trade in Calabar Port due to the restriction of approach draft limitation. It is ironical that the even draft alongside quay at Calabar Port is 10m whereas the Calabar river approach draft is 6.4m on high water. All these have had limiting and stunting effects on the growth efforts of the various Free Trade Zones in Calabar(CFTZ and TFTZ) and has largely made them unable to realize their basic potentials. The FTZ are all struggling presently due to the non-dredging of the Calabar river channel. Based on all of the above, the going-concern status of ECM Terminals Calabar is threatened,” he said.

    But must wait for the dredging of the Calabar channel, which has almost become politicized, continue for economic activities to kick start at the port? Stakeholders do not think so.

    Akande said even as the channel is some vessels can still come in he said vessels can still come in with bulk consignments. There is high tonnage. “The kind of tonnage they can bring in is still enough to make a lot of difference around here,” he said.

    The CFTZ official also agrees with this. “We have always been told that the port needs to be dredged and the channel needs to be dredged but for me as a person, I would love a situation where we encourage smaller vessels to ply the route and channel to make the port busy so that business find it attractive and then continue to use it and then build up skill which would then make it possible for government to say okay lets dredge it and allow bigger vessels. But if we keep saying we would not use the port until the channel is dredged for bigger vessels, if bigger vessels cannot find the volume of business to come here, then we would always remain in that situation. We would not use the port until it is dredged. The commercial shipping lines would not come because there is no volume and because it is not dredged.

    “If investors in the zone could guarantee something like 50 containers a month, if we put heads together all the people around Calabar, the business community under the chamber of commerce, under MAN, and the investors in Tinapa, by the time we put our heads together we can make at least a hundred containers a month.

    “Why it has not happened, I don’t know. If we do this we should be able to attract business. When a ship gets to Onne, we transload it and bring it to Calabar. If we start with a small number of containers and it is regular, we would get the port working. From there we would move to the next level.

    “It would get to a point where everybody would see the port working and would now divert his goods to the port and we would be able to manage it. That would reduce the pressure on the road itself, particularly the Itu road. Anytime there is breakage, think of the trouble, the trauma, the delay. So we are saying let us reduce that. Let us have a vessel that would be bring in containers directly from Onne to the Calabar port.

    Jackson also said the situation does not stop economic activities in the zone.

    “It does not make it impossible for ship to come. At the moment, ships are coming but they are mostly dedicated ones. It only reduces the volume of ships that can come at a given time”.

    Many stakeholders point out that Cross River generally is not an industrial state but with its potential for being an investors’ haven, it could possible beat other economic destinations in no time.

    However, they believe this cannot be achieved if the problems highlighted are not adequately taken care.

    A stakeholder said: “When you look at the traditional industrial areas of the nation whether it is Lagos, as economic hub, Kano as trading hub, Kaduna as manufacturing hub or Port Harcourt for oil and gas, you notice that each of these areas is either full and saturated. So we believe Cross River State and in particular Calabar has become the investment destination of today and tomorrow. Because it is a territory coming out of the doldrums and once we address the challenges of infrastructure, they will beat Lagos, Port Harcourt, Kaduna or any other place. But first they have to address the obvious challenges which are hampering economic activities or they would go nowhere.”

     

  • ‘How leisure could spark business in Tinapa’

    ‘How leisure could spark business in Tinapa’

    Having survived many challenges since it was conceived over a decade ago, the Tinapa Business and Leisure Resort in Cross River State has proved it has come to stay.

    Managing Director and Chief Executive Officer of Nova Rosta, Geraldine Itoe, believes the leisure aspect of the resort which seemed overlooked at first could actually launch the resort to its full potentials of being a business hub.

    Itoe, whose company has been part of the resort since inception, said at first the emphasis was on trade and business.

    She said: “Tinapa is a work in progress and it is a dream I believe in because I have been there. We began with Tinapa from inception. Our first event was the Summer Camp. That was the first event that launched us and opened the window for the leisure aspect. At first emphasis was on trade and business and when we realized that leisure could also play a key role we started out and that in my opinion launched part of the leisure drive. Over time we have been opportuned to arrange other leisure packages at the resort and so many of them. These events they pull in crowds and increase traffic into resort. This traffic has a ripple effect as it enhances business as people go to the malls to do shopping and carry out other such business activities.

    “We have experienced a lot of increase in the traffic coming into Tinapa and it has been upward, because when we first started we had for instance 200 0r 300 persons, but now in a day we could record up to 3, 000 at the water park especially when we host events.

    “Recently, we had the NOVA ROSTA Calfest Millionaire, the first millionaire Christmas event hosted in Calabar and built into the Calabar Festival calendar. It hosted about 9000 persons in the four days the event held and everywhere was jam-packed. I must say the future is bright for Tinapa.

    “Those who say nothing is happening in Tinapa are probably not based in Cross River State. They probably heard rumours. Of course Tinapa had its challenges over time which had changed for the better which I can say as I have grown to become part of the Tinapa family.

    “The hotels now are always fully booked. There is a whole of traffic coming here and to me it is progress compared to where we are coming from. The crowd coming here, as I said especially for leisure, have a spill over effect on other parts of Tinapa which include trading. Even the host community benefits, because there is work to be done and money to be made.”

     

  • Tinapa crawls to life on AMCON’s back

    Tinapa crawls to life on AMCON’s back

    It must have been a difficult decision for Cross River State Governor Liyel Imoke. His predecessor and friend, Donald Duke, had a dream of turning the state to the tourism hub of sub-Saharan Africa. It was a dream Imoke bought into while he was a senator. So, when he took over from Duke, he continued the Tinapa dream from where his friend of many years left it.

    Six years down the line, however, Imoke realised that the burden was too much for the state to bear. So, he turned the business and leisure resort over to the Asset Management Corporation of Nigeria (AMCON). What forced Imoke to take this painful decision are banks’ debts Tinapa has accumulated over the years. The debts to various banks are put at N18.5 billion. No thanks to bottlenecks that have ensured the project remains unprofitable. With this, the government has given 85 per cent of Tinapa’s shares to the corporation. AMCON is expected to inject about N29 billion to revive business activities in Tinapa before inviting investors to take over majority shares in the outfit.

    The Managing Director/Chief Executive Officer, AMCON, Mr. Mustapha Chike-Obi, said: “The strategy is to find an operator for Tinapa immediately. We will advertise for an operator very soon, inject capital into the facility and allow the operator to run it for some years. After Tinapa has been made profitable, we will privatise it just like we are doing to the three bridged banks we took over. So it is the same strategy we used for the banks that we are using for Tinapa.”

    The Speaker of the Cross River House of Assembly, Mr. Larry Odeh, believes the move to privatise the Tinapa is in the best interest of the state, adding that it will stimulate growth of the economy of the state.

    But some of Odeh’s colleagues believe there are issues to be sorted out before the giant edifice is turned over to private hands. A member representing Ikom 1 Constituency in the assembly, Mr. Agbiji Agbiji, said the contributions of local government areas in the state to the project must not be allowed to go down the drain.

    He said: “The LGAs have invested; so is the state government and they want to know the cost of ceding ownership to AMCON and other details of the Memorandum of Understanding.”

    Another member, Mr. Jake Enyia, toed a similar line, saying: “We should not just pass it because it will amount to legislative rascality; we need to put things straight because when I was chairman of council, I contributed N180m, so also other council areas.”

    But, how did Tinapa get into this mess? The $600 million worth Tinapa Business and Leisure Resort has not had it smooth since it was inaugurated six years ago. The 265 hectares empire’s ground-breaking ceremony was performed in Adiabo, on the outskirts of Calabar, in 2005. And on August 15, 2006, the Federal Government declared the Tinapa Business and Leisure Resort a Free Trade Zone pursuant to the provisions of Section 1(1) of the Nigeria Export Processing Zones Act No. 63 of 1992. Investors saw this declaration as the tonic needed to realise Duke’s vision. The excitement was palpable.