The coming of Nigerian Shippers Council as the nation’s ports economic regulator has, no doubt, been highly impactful. If nothing else, within one year that it assumed its mandate, the cycle of goods clearance at the ports has been reduced significantly and the menace of brigandage has been replaced with orderliness. However, these gains, among others, have not been without attendant challenges of moving away from primitive ways of port operations that encourage corruption, to the new order of seamless and modern port operations, regarded as transparent and highly profitable. The Executive Secretary, Nigeria Shippers Council, Hassan Bello, shares with Kunle Aderinokun, the far-reaching reforms that have been implemented in accordance with international standards, the prospect and challenges that lay ahead, which he believes, are not insurmountable, as he gives a peep into the bright future of the Nigerian Port. Excerpts:
This year’s February, Nigeria Shippers Council clocked one year as ports economic regulator. What are your gains, challenges and vision?
Let me start with the vision. The vision is simply to make Nigerian ports the preferred destination for cargoes in the western and central Africa sub-region. We also need to manifest the potential of the maritime industry so that it will have the needed impact on the economy.
The vision is to make our ports efficient and effective to attract cargo away from our competitors; to build and promote building of modern transport infrastructure to cover the huge infrastructure deficit that we have in the industry; and to guard against monopoly and encourage competition among the ports. Generally, what we are saying is Nigerian maritime industry should contribute largely to the economy of Nigeria in terms of economic growth, employment content, modern infrastructure and of course, these would translate to GDP.
We would like to see that the maritime industry has become a veritable source of revenue, exceeding oil and gas. We have examined amongst the stakeholders that sector could contribute to N7 to N8 trillion to the economy and our budget is N4 trillion.
This is the vision of Nigerian Shippers Council but this vision must come with a lot of political will from the government.
The challenges are enormous but they are not insurmountable. There is what we may call initial regulatory resistance and there will be the problem of coordination, there will be the problem of territorialism by several government and non-government people who are on the board and general resistance to change. But the most rewarding thing is that it has been known, it has been acknowledged, it has been accepted that there is an economic regulator both internally and internationally and certain practices are being curbed and we are moving towards that direction.
The challenges are that of recognition and acceptance. Another major challenge is changing the way people think about doing business; we have to re-orientate people to think about ease of doing business; we have to re-orientate various operators at the ports about technology and automation. If we have technology and automation, which we will soon embark upon, more than 70 per cent of the problem of the ports will be solved.
We are also looking at the government; the government has responsibility to bring out policies that are consistent and transparent. The government also has the responsibility to provide a conducive atmosphere for operators to operate. We have to sometimes criticise the government for its change of policy or flip-flops, there must be consistent dynamic policies that will not only guarantee but also protect investments of operators. The shipping companies and terminal operators have made investments in this sector, it is important that they realise the return on their investment and this could be made on sound economic policies of the federal government.
The Act that established Nigerian Shippers Council as ports economic regulator has just been promulgated. What do you stand to gain with this act?
The order, that is, the Nigerian Shippers Council Ports Regulator Order, which was signed by Mr. President in 2015, is a legal framework that has strengthened the work of Nigerian Shippers Council as economic regulator. We have the legal authority to act as economic regulator and for every regulator without a legal authority, it will be like you will just be advocating, looking for moral suasion and some other issues to convince everybody. But this is the legal authority that we have; it is clear because if you look at it, what it says in the preamble is that: “In exercise of the powers conferred upon me by Section 5 and Section 148 of the Constitution of the Federal Republic of Nigeria, the President makes the following order: the objectives are just simply, to: 1) Institute an effective regulatory regime at Nigerian ports for enhanced efficiency. And, 2) Address the negative impact of ports concession activities on the economy due to the absence of an economic regulator.”
So, this vacuum has been identified by the government and the government has made the appointment. Luckily, even the concession agreement signed between the NPA and concessionaires has made provisions for an economic regulator. So, this vacuum, the government has now filled through law.
Also, pursuant to that, the minister of transport has made far-reaching regulations towards effective regulation. If this is a presidential announcement, this is the way to go about it; so we have Nigerian Shippers Council Ports Economic Regulations made also in 2015 and its very succinct, clear and lucid. But most importantly, it is done by the buy-in of the stakeholders. Many institutions had a retreat, which produced this order. It is not Shippers Council law, it’s an industry thing, which is very important. Even without these concrete issues, Nigerian Shippers Council has regulatory and advisory functions in its act; that’s why the Shippers Council was asked to do this regulation.
The Cargo Tracking System is a project very dear to you. How is it going? What will the economy stand to benefit from it?
The Advanced Cargo Information System, which you called Cargo Tracking System is a trade facilitation issue because it is a very important source of information. International trade thrives on information- credible data. And that is what the cargo tracking system does. You may recall that cargo tracking system was introduced about three years back. It was suspended because it was added to the cost of doing business because the people who were operating it thought it was a revenue earning thing. It was supposed to be operated by Nigerian Shippers Council in the first instance; however, for some administrative reasons or other purposes, it was taken to another agency. Now it is back to Nigerian Shippers Council and we are going to the basic; it will not cost much; it will just be barely administrative cost but it is a source of immense information. We will know at the point of loading of the ship which cargo is coming to Nigeria. The advantage is that we will know the trade pattern and there are also security issues involved, which we will be able to determine.
This is data that will be shared with very important institutions like the Central Bank of Nigeria, NPA, Customs and NNPC. Even more important, if we have advance knowledge of information, Shippers Council will have to share this information with terminal operators, the shipping companies and customs as well as other relevant institutions. This will cut drastically delays in vessel resumption and also cargo clearing procedure because if you have information even before the ship sails- that certain ship is carrying a particular tonnage, certain type of goods is arriving this time, customs will be ready to receive it, port concessionaires are ready, the shipping companies must have prepared. So, all the delays will be minimised, if I may call it, and it is what the stakeholders have been calling for when we had our meetings and this is what we are delivering.
If we have this, it is extremely important for regulation. Information about the cargo, information about international trade, security issues and it will also stop pilferages, leakages and hemorrhages going on in port operations because if we have to have the revenue from the port operations, we have to stop all this. Advanced Cargo Information System will be able to curb these malpractices that we see. It is transparent, it is going to shared with everybody so you cannot even cut corners with this information. It is very important for clarity, it is very important for internationalisation of cargo clearance procedure. Nigeria will be at par with many country, you cannot under-declare even for the shippers- sometimes when they are not compliant, they will import tyres and say it’s something else- but with this we have clarity, everything is clear and things will be processed with procedures and we will not have delays in Nigerian ports. This will add to the competitive edge over other ports; we should not forget that we are in competition with other ports.
The maritime industry is witnessing especially the ports seamless operations. What are the contributing factors?
The contributing factor is that there is a coordinator, there is a supervisor, there is equilibrium and balance, there is effort to streamline things, there is a referee, there is an umpire. Hitherto, it was brigandage, chaos, unsightly things at the ports and Nigerian Shippers Council said we cannot have a primitive port any longer; we cannot have stone-age clearance procedure; we cannot have laissez-faire attitude to international trade at our ports. Our ports are the gateways; they are the first sign of how serious a country is. Our transportation system is a mirror that reflects the seriousness or otherwise of Nigeria and our economy hangs on the efficiency of our transportation system. Therefore, we must encourage seamless transport system; we have many modes of transport. The world now is multi-modal, we have to make sure that there is connectivity between our various modes of transport and seamless ease of doing business and that is one cardinal function of Nigerian Shippers Council. Nigerian Railway Corporation, two weeks ago, had a big meeting where we had to determine access to our off-dock terminal, which we call Inland Dry Port.
There is a lot of things happening in the transport sector and Nigerian Shippers Council is at the centre of it.
With your new role, how are you carrying stakeholders (especially the concessionaires) along and specifically, how is your collaboration with Customs, Nigeria Port Authority and other technical regulators and is there any conflict of roles?
We are carrying all the stakeholders along. Concessionaires are the first port of call. As I said, concessionaires are our partners. They have made tremendous investments but there is room for improvement, especially the land side of it- clearance of cargo, evacuation of cargo, amongst others.
When the regulation was given Nigerian Shippers Council, we were working with the Bureau of Public Enterprises and one of the first things we did was consultation; consultation became necessary because it’s a new thing you are introducing to the industry and our first of call were the operators, which I call our strategic partners, that is, the terminal operators and shipping companies. Then, we were talking with the freight forwarders, the truckers. We talked with MAN, we talked with NACCIMA, we talked with all sort of interests in the ports and they are as varied as they are things to do with the ports. We will talk with many other institutions also. On the government side, we recognise strategic and very important agencies. We are talking with the first port of call, which is NPA; NPA is the landlord of the port and extremely significant partners. We also talk with NIMASA, very, very, cogent relationship we have with NIMASA’ we are talking with the BPE and SON and many others.
And of course , Customs. We have made wide consultation because what we said is, all our regulatory modalities must be transparent, democratic; we have to have the buy-in of the stakeholders. Thank God, people have been responding. The NPA has introduced, at our instance and at our urging, for example, the e-payment, be it payment for vessel and other charges. Before, one have to go to VI to pay for a barge and bring in the teller, go to the Wharf and do this and that, taking five days to pay for a transaction; this is primitive ! We say no you cannot do that, this cannot continue. But now in six minutes, you make that payment. This has slashed the time significantly, that’s the beauty of automation. NPA has to really be commended for that. NPA has also improved its marine services, again at the instance and urging of Nigerian Shippers Council. They have now procured a tug boat, pilot quarters and taken care of other issues. We are still working; even tomorrow, we have a meeting with NPA, so that we’ll streamline issues. We are working on access to Apapa port; modern traffic management, electronic traffic management.
We are working beautifully on transit cargo to Niger with NPA and on any other collaboration that we are doing. As for Customs, it is also a very, very beautiful story; we have discussed on many occasions with the Customs and the Customs high command has made available to us, a forum of all the comptrollers, operating in Lagos, where we meet constantly. This meeting is to bring together operators, people who complain about Customs, sit down; we are the umpire. We say, ‘You, please, what is your complaint?’ 100 per cent examination, breaking down of scanners, activities of Federal Operations Unit and so on and so forth. And we looked at these things: ‘Customs these are the complaints from the shipping companies, these are the complaints from terminal operators, these are the complaints from freight forwarders. What is your response?’ And through that, we are eliminating so many issues. Before, when PAAR was introduced, you need to see my table, ‘because we had complaints of PAAR dispensation but with the customs, we explained and many people then understood. Now PAAR is not a problem anymore.
We are also collaborating with Customs on trade facilitation. Whether you like it or not, all of us are trade facilitators. Trade facilitation is automation, is electronic platform so that things will be done easier and in accordance with the world standards. We are working together now with one stop shop, national single window. We are also working with the Customs on transit trade. Niger, as close as it is to Nigeria, will have to import its goods through other countries that are very far. That does not make economic sense. First of all, we had to sensitise Niger that our ports are efficient; we invited them here, they inspected our ports and facilities and they found out that Nigerian ports are extremely efficient. So Niger is bringing back its cargo here. Two weeks again, Chad approached us that if we are going to have an arrangement so that goods should be transported instead of them importing their cargoes through their own ports, they should use Nigerian ports and these are all done by Nigerian Shippers Council. From Niger alone, we are expecting 3 million metric tonnes of cargoes per annum and that is what it will translate on a lot of businesses for our port operators, for our shipping company, for our truckers and other ancillary services that will come but our ports must be efficient; they must deliver. And this is where the Nigerian Customs comes because Customs has made that transit trade possible; they have been very, very responsible and the Customs is one of the institutions that have embraced technology and automation. They have seen the advantages of it and they are doing collaboration with us on transit trade. The collaboration with the Customs will make transit trade easier; it will be a captive trade for us. Management of the corridors, Nigerian Shippers Council is already involved in that and other trade facilitation.
Is the court litigation by STOAN( Seaports Terminal Operators Association of Nigeria) and terminal operators not delaying your vision for the ports?
I think it’s a matter of interpretation of what regulation is. You know the issue is still in court. It is painful that this thing ended up in court, otherwise, we have struggled to resolve the issue, we have negotiated with the shipping companies and terminal operators. I think to dot the Is and cross the Ts was what remained before certain things happened and it resulted in court. Despite our decisive victory or the pronouncement of the court, which was very clear, we never boasted about it, there was no sense of triumph for anything on our part because we still believe that this thing should be settled out of court. Regulations are made within the industry. If there are disagreements, there must be a certain way of resolving them. We are evolving a mechanism for arbitration or alternative dispute resolution so that certain things would be resolved.
I think it will be a slowdown but we are still talking. We meet with terminal operators, we meet with shipping companies, we meet with freight forwarders and so on and so forth.
We are still working together. I think the small matter of the court cases is a small blight on the success of it but that does not mean we are not forging ahead.
The Inland Container Depots (ICDs), a novel idea of the council looks like its moribund. What is delaying its take-off?
The idea of the Inland Dry Port, life has been put back into it. The Kaduna Inland Container Dry Port has been designated and gazette as the port of destination and port of origin, which means you can consign cargo from any part of the world. You can take cargo from Liverpool, using bill of lading, to Kaduna and cargo will come there. The idea is port is always a trust place for cargo.
Nigerian Railway Corporation takes a lot of containers to Kaduna; from the port here, it will be taken and at that port, it is a port in every sense of it; the only thing absent is water but you have. We also have dry ports in Isiala Ngwa, in Ibadan, in Jos, Funtua and Kano. We have applications in Osun, Onitsha and Kebbi and so many people have seen the beauty of it; its bringing shipping to the doorsteps of shippers. It is the panacea for port congestion. You wouldn’t have this traffic you are having now before no truck will come; you will just use train and other means, may be inland waterways to carry your cargo to those places and when you get there, they will examine the cargo and you pay duties- we have customs, we have everything, we have shippers council offices all over there. So it is a port in every sense of the word. And I think one has been declared now- the Kaduna port- and it’s becoming operational and we would still have meetings with Kaduna state government to discuss because there was an MoU between the operators and Kaduna State government. Kaduna state government has really made so much commitment in providing infrastructure to the place. So now, it’s a port in every sense and that is what we want replicated in Isiala Ngwa, Ibadan, Jos, Funtua, Kano, Osun, Onitsha and Kebbi and other places.
Human capital development is one area that drives a system. What are you doing towards developing the staff ?
The first thing is to look inward. Does Nigerian Shippers Council have the structure to carry this added assignment ? We have been told that if you don’t have the structure to carry out certain assignment, they you are doomed and you are going to fail and that is why we have certain consultants who looked at the internal structure of the Nigerian Shippers Council. They have been working to fill the gaps. And also, what is the deficit in human capital development? They have designed courses, especially in tariffs, in audit of operators and in economics generally so that we will have resource persons.
Another issue is the change of attitude, which is also important. Nigerian Shippers Council, at the beginning, was a cargo-biased institution. We protect cargo at the expense of every other interest. Now, Nigerian Shippers Council has been moved to the centre; we are not cargo-based, we are not ship-biased or terminal-biased or freight-forwarders-biased. We have to encourage the symmetry, we have to encourage the cohesion and in working together, we have to establish a level-playing field so that all these important actors and interests will work in unison and unity, so that we will fulfill the assignment that was given to Shippers Council. So that attitude we are changing in the system.
We are also going on very, very important training programmes and we have seen the result; we have to be more educated than the people we are regulating; we have to know about what is happening in the world; we have to know about the international dynamics of shipping; we have to know about key performance indicators; we have to know how to measure and audit and share information.
And that is why our expertise is sought out. We are collaborating with the Central Bank of Nigeria on very, very important assignment right now. Shippers Council must be at the heart of shipping, it can never be at the peripheral again. We have to coordinate even investments, Nigeria’s investments in this sector. Like the deep sea port, we have to advise the government. We have to advise the government on the capacity to have ships. You can imagine, if we have ships, the freights we will be earning and you can imagine the impact of the freights on the Nigerian economy.
If we are carrying our crude oil on CIF basis instead of FOB, you could see the tremendous impact, the whole economy of Nigeria will be transformed because the insurance companies will have to come up like the banks and take these risks. You can imagine the effect on the economy, real employment and infrastructure. Our banks will have to be at the centre of shipping. Shipping contributes 80 per cent to certain economies and that is what Nigeria should focus on and it’s doable.
As a means of facilitating trade, some corridors were designated as truck transit parks. How far are you going in this direction? Are there any challenges
There are, as usual. The truck transit parks are also the idea of Nigeria Shippers Council to first of all, cure infrastructure deficit, to modernise the Nigerian economy as far as the transport is concerned. You go to Ogere, you see how trucks are parked anyhow on the road, you go to Mararaba, Jos, you go to Kaduna, you go to Obollo Afor in Enugu and Long Forest in Jos, the way things are done is primitive. We said we can no longer have that. The truck transit park is a modern park away from the highway, where we have modern place for driver; there will be facilities like restaurant, motels or hotels, repair workshop, so that people driving through can go and rest there and sleep so that tomorrow, you resume your journey.
Now, in those truck transit parks, we also monitor cargo; you know our drivers go to those villages and stay for five days but you have no way of knowing if they are coming or not; you can track your cargo. So it’s important that we modernise our facilities, failure to do will have serious impact on the economy.
We have to appreciate Kogi State government for giving us a big expanse of land to start one in Lokoja. We are thinking of inviting Dangote, who has a cement factory in Obajana and we are also discussing with NNPC, who want to have its retail outlet in this truck transit park.
When we do that, we start talk for the Kaduna one and ObolloAfor and some other places. Because this is done on PPP basis, we have started talking with the ICRC for it to be done scientifically and that is how we transform the infrastructure.
You have been discussing with the Central Bank of Nigeria on how to curb capital flight. How far is this project , given its role in the economy?
We are collaborating with the CBN to stem capital flight by confirming the reasonableness or otherwise of freight coming to Nigeria and also charter party charges for ships because there is a tendency to inflate these things to make capital flight and so on. But we are confirming that because of our expertise and more collaboration is expected in that direction with Central Bank.
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