The Executive Secretary, Nigerian Shippers’ Council (NSC), Mr. Hassan Bello has said that the port reform carried out by the Federal Government in 2006 has failed to bring about a robust and sustainable economic growth to Nigeria.
Bello who stated this in a lecture he delivered at a 3 day All Nigerian Maritime Journalist’ Retreat held at ASCON, Topo, Badagry in Lagos last week by the Association of Maritime Journalists of Nigeria (AMJON) recalled that the objective of the port concession were located in the overall desire to achieve fast clearance of cargo, improving on all Key Performance Indicators (KPI) in port operation, removal of duplication in the functions of the security and related government agencies and the facilitation of trade.
He noted that the port concession was done specifically to to increase the efficiency of port operation, to decrease the cost to government of supporting a viable port sector, to decrease the cost of port services to the port users, to boost economic activities and accelerate development, improvement in infrastructure among others.
The NSC boss observed that since the port concession in 2006, some modest achievements had been recorded especially in the areas of operational efficiency, infrastructural development in the ports and increased safety of cargo among other numerous achievements.
“However, the operational efficiencies achieved from the concession exercise has been eroded by excessive and high charges, violation of concession agreement, arbitrary introduction of new and increase in charges, cargo insecurity and undue delays in cargo clearance and general oppressive policies and practices in the ports. Noticeable vacuum has been observed in the concession agreements. These have made it difficult for the nation to enjoy the gains of the programme. It can therefore be safely said that the reform has failed to bring about a robust and sustainable economic growth to the nation”, Bello stated.
While recalling that the concession agreement of 2006 specified the need for a review of the document every two years, he however regretted that ten years after the implementation of the programme, a comprehensive review was still in the works.
According to him,”Indeed, the concession agreements made a provision for a regulator to be appointed to ensure that it is implemented successfully but it was only done eight years after the concession. It has successfully and succinctly been canvassed that if the ports were operating competitively, cost effective and efficient port concession in 2006, that there would not have been any need for a regulator (Nigerian Shippers’ Council)”.
Bello however maintained that the new dawn from the perspective of the Council was when the port reform policy was carried out in 2006 as well as when the Council was appointed as the Port Economic Regulator on the 20th of February, 2014 as according to him, the council had over the years developed the requisite experience in economic regulation through her tariff moderation exercise and resolution of claims and disputes between the providers and users of port services.
He recalled that the council had carried out diverse regulatory interventions at the ports as part of its activities even before its appointment as the port economic regulator in the areas of tariffs and charges, trade facilitation and trade development through various projects and programmes such as the moderation of tariffs through the signing of Memorandum of Understanding (MoU) with the shipping agencies among other interventions.
He enumerated the gains of having the council as the port economy regulator to include coordinated transportation and logistics chains,improved port efficiency and competitiveness as well as eliminating dominance monopoly, improved port infrastructure and transport connectivity and curtailed capital flight through confirmation of the reasonableness of charter party fees, freight rate, vessels and container demurrage and blocking other leakages.
Others according to Bello included, improved turnaround time of vessels and reduction in cargo dwell time as a result of seamless transactions and port operation, economic growth and development, improved balance of trade and employment generation.
He listed the challenges faced by the council in the effective discharge of its duty to include lack of cooperation and coordination among the regulatory agencies, poor funding, litigation by Seaports Terminal Operators’ Association of Nigeria challenging the regulatory mandate and notices of the council in spite of expression of acceptance and pledge of cooperation.
Others are delay in firming up regulatory framework, resistance to new port order by some stakeholders and uncooperative attitude of some regulatory agencies at the ports.
He pointed out that privatization without economic regulator as was the case with Nigeria resulted in high cost of doing business as a result of impunity and unjustifiable imposition of charges on port users by service providers.
He therefore assured that the council as the nation’s economic regulator was poised to address the current and future challenges so as to transform the nation’s ports to a centre of international freight and hub for the sub-region.
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