Mr. Paul Ndibe is the National Executive Director, Chartered Institute of Logistics and Transport (CILT) Nigeria. In this interview with our correspondent, he bares his mind on the successes recorded in the transport sector in the year 2014, the prospect of the industry this year, the National Transport Policy bill before the National Assembly among other issues. Excerpts:
What is your assessment of the transport industry in the year 2014?
The transport sector is fluid in the sense that it is not static; a couple of faults can really upturn major development and it can also create new initiatives in the whole scheme of the transport and logistics sector.
However, last year wasn’t particularly a bad year for some sectors; it may appear to be tough in some other areas but on the whole, if you look at the transport industry itself and the value chain in the economy, you will attribute it to the logistics and transport sector and that shows somehow, the industry is doing well.
But the rate of growth or development cannot be even for all the sectors. You recognized that earlier in the year, we had issues with aviation industry and then it wasn’t like that with the sea and maritime. So, individually, some sections of the industry are creating and increasing capacity which is also adding to the entire value chain.
Having said that, we will all recognize that with the new initiative that the NPA is doing in respect to the advance notices of ship arrival, that is the E-Sen, it is also adding to the efficiency in the port. And then towards the end of the first quarter when the commercial regulator function was giving to the Nigerian Shippers’ Council, that was also a big boost and they are increasingly creating capacity in that direction.
And if you look at NIMASA, with the seafarers’ capacity they are trying to build for Africa, it is also good and it shows really that people are thinking in that direction and it is actually helping.
But on the road, we have not seen such major leap or leverage. The road indeed is becoming better but then the vehicles on the roads have not really helped matter and then the operators they have not changed, no new thing has been added to their knowledge base and the way and manner they are organized because there is no new law to guide operators in that sector. So, we still have problem on the road.
So, if you look where we have problems, the air, we have problem, the road, we have problem, the rail, yes, massive improvement because of the rehabilitation project and the new thing they are adding. Last year or towards the end of the year, they were commissioning new trains especially for the passenger services and that helped also in alleviating the burden of mobility within Lagos and other areas.
I am aware that the railway increased trains services both on the inter city and intra city corridors and recently, that was late last year, they also opened up the eastern lines with a train service between Port Harcourt and Enugu and they just recently launched one in Benue state, Makurdi. So, you can see the marginal incremental improvement they are making and it is gladdening to observe that. That is for last year.
And then that really helps us to reposition for the new challenges we expect in 2015. For challenges, yes, they will come but we are looking at those challenges as the things that we need to come up stronger.
What are the areas you expect things to be done differently this year in the transport industry?
I expect the marginal improvement we are seeing in the rail sector to continue because opening of Port-Harcourt –Enugu rail line and the recent launch of the renewed passenger service in Benue State, that shows that they are almost connecting the rail lines in the eastern wing.
You will recalled that it was the line in the western lines between Lagos and Kano that was connected. Now they are about connecting from Port-Harcourt to Maiduguri, once that is connected, you can be sure. Enugu-Port-Harcourt is opened with Makurdi is now running; there is the possibility of rail linkage between Enugu and Makurdi. So, you now have a stretch of over 464 kilometers from Port-Harcourt to Makurdi and then with the incremental improvement they are also making with the Bauchi- Kuru lines, you will expect that once it is connected, you are okay with the rail.
The sea/maritime, they are not resting, even the capacity for the seafarers and some study centres established in some universities , it is also helping and it is drawing people to the maritime. It is capacity that we are looking at, efficiency.
So, on the sea/maritime, three things we are looking at, development of capacity which NIMASA is championing, the effect of the commercial regulation which the Shippers’ Council is also heading and then improvement the NPA is engaging on particularly with respect to monitoring of the concessionaires in the ports.
So, if they are more efficient with the input from NPA so that we do not have the last incidence we had with AP Moller that disrupted operations for some time. If NPA can tidy that up and make the majority of the terminal operator to be as efficient as they should, they can see what we are expecting from the sector from these three key areas.
Then the rail, the air is a bit stabilizing, so we expect this stabilization to continue. Although it has not affected the desire to renew the air mode and then the fares have stabilized also. With the stability in the fares and the renewed confidence in the air, we are expecting this year in the air sector.
The road, there is no clear indication for now and we are expecting that this is the area we want government to pay greater attention. If there is a regulator for the road, then we can be sure but for now, there is no regulator. It is a problem. Some states are on their own trying to come up with some certain things that will generate revenue for them not necessarily monitoring the behaviours on the road and in the number or size of commissioned vehicles on the road but generating revenue. So, that interest of revenue generation is taking them away from the core thing which the institute wants in place.
So, I am looking at the road sector as a more of a challenging sector this year but for the other sectors, we are looking at them to be stabilizing this year.
In all these, what is the role of the Chartered Institute of Logistics and Transport (CILT) Nigeria towards ensuring a better industry this year?
You will not be able to stabilize the sector if you don’t have a legal instrument to do that and that legal instrument is what we are expecting to see in the National Transport Policy. During the National Council on Transport, the institute presented a paper on the challenges on the road sector.
So, we are looking at when government concludes with all opinions expressed, they might be able to come up with maybe a policy that will give a backing with what the institute might expect or give a responsibility to people to undertake some of the functions.
The government may not do it alone but there is a regulatory body that can do it but it requires the instrument to do that and that is our own expectation for this year.
The current National Assembly is about winding up now and the National Transport Commission bill before it may not likely sail true in this dispensation. What is the implication of the failure to pass the bill on the industry?
The bill is to set limiting clauses and if there are arguments, they are to draw limits. But government pronouncement should come first, when there is government pronouncement, the bill can now tidy up the grey areas but if there is no government direct pronouncement, you don’t talk of the bill. Look at the commercial regulator, is there any bill backing it up yet? There should be government pronouncement that is the issue.
In the case of the Nigerian Shippers’ Council, there was no legal provision for its new status but won’t it be said that the recent court ruling between it and the Terminal operators can now serve as the backing of the law?
I have not been fully briefed on the effect of that legal opinion expressed. However, it should be built on something; it is a government property and it is government’s responsibility to set standards. So, the government says, this is how this should function and made a pronouncement on who the government will hold responsible for executing that. Like I said earlier, the essence of the bill is to set limiting clauses but there should be somebody who should take responsibility first. It is only when that responsibility is on that you now set standards or limits, the boundary lines and things thereof.
With the fall in the oil prices globally, do you see any effect of this development in the transport?
Yes! What we might expect is a reduction in the volume of government intervention in some of these projects but not necessarily on the system as it functions because if you look at the transport sector, it is not heavily government centred, it is private sector driven. So, it might not really affect investment plans for individuals who have planned to make investments in this direction.
But for government to take up new projects like new roads, it might affect the capacity or the ability of the government to do that because of the reduction in the proceeds coming from the oil sector.
Having said that, with the reduction in the oil prices, one had expected that it would have reflected in our inflationary pressures but it hasn’t because some people are taking advantage of it and have not allowed the adjustment in prices to reflect in the commodities they are selling. Even in the transport fares, they have not, which means some people are taking advantage of it.
The critical thing we are looking at is that government should have a mechanism of allowing these things to trickle down to the individuals who are participators in this sector. It is that mechanism that we also expect that government enshrine in the National Transport Policy so that when there is such effect, not only when there is an increase, it trickles down. If there is a reduction, it should similarly trickle down so that effect can be felt, the inflationary pressures coudl come down and people will have value for their money. That is the expectation.
During the planned subsidy removal that triggered off nationwide protests in Nigeria in 2012, the government made some interventions in the sector by giving out vehicles to different transport groups to cushion the effect of such action on the economy. But since then, we have not the repeat of the gesture in the industry. Don’t you think government should have continued in this direction?
Well, just like you said, it was a onetime intervention. What if the government had brought out a particular sum of money just for the purposes of our discussion, say one hundred million dollars for this intervention? It is supposed to be a revolving fund, it is not ex gratia.
The critical thing is that those who have taken advantage of this fund, are they making the necessary returns? If they are making the necessary returns to the pool, are they now giving it to new applicant? That is what we should look at first. It is not an ex gratia thing, it was supposed to be a pool to intervene in the distortion we have in the transportation system.
So, the body organizing it should take the responsibility for revolving the fund except it is not designed that way, it is only when it was not designed that way that we will expect subsequent government intervention. But if it was designed to intervene in order to remove the distortions in the transportation system, the expectation is that that fund should revolve. It might have a three year or three and half year revolving cycle, we don’t know. But since it is not yet three years, the minimum should be three years, let us expect that it is three years and the fund will revolve.
The rail sector seems to be a government monopoly. Don’t you think that opening up the sector for private sector participation would attract the right investment thereby moving the sector forward?
For the rail sector, there is no argument about government willingness to unbundle the rail sector. But the critical thing is what is the value you will get in unbundling it? What I think the government is doing right now is to upgrade it so that it can come up to a stable level otherwise you will sell it as a scrap.
If it is up and running, there will be greater value for it so that even if you offer it for sale, you have much more value for maybe those who would want to invest in it. What government is doing is to restructure it, revive it, let it be running so that whoever will take it up will take it up from the level they met it and then have a development plan for it.
Government will not give it out if there is no vivid and agreed development plan of lifting it. Government will release it but government should be running it first so that it would be able to say look, we have been able to take it to this level before it is given to you. Whoever is asking for it should also be able to submit a vivid development plan before it will be given to him and he has to be monitored closely to ensure that he will not run it and depreciate the value all the time that you are going to leave it behind depending on the model the government wants to maybe follow in terms of rail transport.
How has the Chartered Institute of Logistics and Transport (CILT) Nigeria fared in the last one year?
It wasn’t too bad and at the same time not too rosy, you recall, last year was our first year of operation as a territory and incidentally, the only territory in Africa. It was not very easy. Instead of a branch, you are now a territory. You now have a responsibility, you have the luxury of taking a new thing on your own, executing them but then reporting to CILT international.
What we are trying to look at is one, our membership base, if we are able to consolidate on our membership base which was our reason for attaining a territorial status; we take it up from there. We are happy with the new things we are seeing in the sector, what the NIMASA is doing, even some schools, tertiary institutions taking up some studies in the maritime sector. At the end of the day, they will seek our professional certificate. It is also helping in creating and expanding our membership base.
What we are now looking at is how are we to consolidate on these gains? Our bill to domesticate the charter of the institute has been with the National Assembly, we are looking at as soon as the 8th National Assembly reconvenes or is inaugurated, we will be able to take it up from there so that we conclude that aspect because at the end of the day you require to domesticate your charter in order to function as other professional bodies.
What are your plans for this year?
To be more visible, increase our membership base, follow up with the domestication of the charter and then interact more with the government and offer the right advice where necessary.
Finally, what are your expectations in the forthcoming general election in Nigeria?
We are all eyes open and very optimistic. The prayer has always been that may the good lord provide the set of leaders that will really take Nigeria to the next level, a set of leaders that will really feel the pulse of Nigeria and then wipe our tears and make Nigeria a prosperous nation. That is our hope.
