As a shipping magnate and former president of the oldest freight forwarding association in Nigeria (ANLCA), Tony Iju Nwabunike has said that without fixing infrastructure and fighting corruption, Nigerian ports cannot develop and compete with other neigbouring ports favourably.
In this interview, he pointed out that Nigeria does not need to give any individual or company concession to fix port access roads and other infrastructure in the port, adding that the industry has the capacity to generate billions of dollars and employment but it has been neglected by the Federal Government.
He spoke on the danger of the $3.2 billion Customs modernisation project and other related issues as they affect the industry.
What can you say are the reasons behind the slow growth of the maritime industry, despite its huge potential? How can the hurdles impeding growth be dismantled?
We have challenges of poor basic infrastructure, inadequate investment in port-related technology and corruption.
Talking about infrastructure, one good example is port access roads. All the roads linking Nigerian ports to town are in very deplorable state and I can say this has become a huge embarrassment.
Move around to Apapa, Onne, Calabar, Warri and even the recently constructed Lekki Deep Seaport, the whole roads are nothing to talk about.
We talked so much about state of disrepair of Apapa port access road more than 20 years ago when former President Olusegun Obasanjo was in charge. Two decades later, we are still on the same issue.
This clearly confirms that our government is interested in the revenue from the ports but not making commensurate investments to sustain those critical national economic assets.
As at 2013, the Port of Tema in Ghana, which is relatively smaller in size, had already emplaced technology for access control where only properly identified and authorised persons can access.
In 2023, we are still struggling with access control in Nigeria and far from getting it right.
On port matters, I like making comparison with proximate countries like Ghana, Benin, Togo, Cote d’Ivoire and Cameroun because they are the maritime countries we are competing with.
While we are bigger in size with enormous potential for international trade, these smaller countries have invested heavily in their ports in terms of technology and modes of operation. The truth is they have left Nigeria behind.
It is even sad to see Nigerian government taking loans to fix roads in places that are not generating revenue for the country while the port areas, which is second to oil, is bugged by poor infrastructure.
My findings have shown that from Apapa alone, the federal government makes an average of N17 billion every 24 hours. I am being modest with the figure. Just recently in August 2023, one command of Customs announced N10 billion revenue collection in one day.
Other commands are there, NPA, NIMASA, FIRS and others are collecting different taxes and fees for government within the port area. Where are these monies going? Why are are we not fixing the goose the lays the golden eggs?
Similar collections and increasing revenue figures are being posted by these agencies. There is no excuse not to fix port infrastructure. In the real sense, we don’t need a loan to fix it. We don’t need to grant any company tax holiday to fix our port access road.
Making the revenue is one thing, the question of what we do or how we dispense collected revenue is another thing entirely.
When you see the quality of ship-to-shore (STS) cranes in use at the port of Dakar, Senegal; Lome, Togo; Tema and Takoradi in Ghana and other neighboring countries, you will marvel.
Our port concessionnaires are not doing enough. The best we had were rubber tyred gantry (RTG) cranes until recently when Lekki Port came in, wanting to change the game.
Ironically, some of the companies that are port operators in Nigeria are the same companies in these other West African countries. They seem obliged to do the right thing in other countries but in Nigeria their character changes. Maybe our regulation regime should be worked upon.
Government agencies also perform overlapping functions or work at cross purposes. There are instances of duplication of functions, which amounts to being counter-productive
I won’t dwell on the corruption aspect in Nigerian ports. That is like a bottomless pit. So many unreciepted payments going into private pockets frustrate trade.
This is also one area I except President Bola Tinubu to do something about very fast. While other countries are moving on at a fast pace, we are stuck discussing extortion of trucks accessing and exiting the ports year in, year out.
Government agencies within the port use bureaucracy to delay ship turnaround time as strategy for extortion and those who do examination of cargoes want to take too many samples after demanding monies. These are norms we can’t over-pretend about
Nigeria is said to have lost the transhipment market to Ghana, Togo, Benin Republic and other neighbouring ports. How can we get back on track as a leading maritime hub?
Trade facilitation and ease of doing business do not exist in the real terms in Nigeria. If we don’t do those things I mentioned earlier like fixing port infrastructure and fighting corruption, we won’t move an inch. It will all be motion without movement.
I am aware the quayside of Tincan Port and some other ports have decayed and about falling off. It is ignored. No one cares until maybe they finally collapse and vessels are unable to berth.
If we can’t fix these basic things, how then can we compete with Ghana, Togo and Benin?
We only talk about wanting to be a hub port because we are big and have space to accommodate large volume of trade but we are unable to maintain or properly manage our big size towards attaining port efficiency. May we not be big for nothing. The truth is, our ports are big, but not efficient. Efficiency in time and cost saving for the trading community is essential. Not only about size
As an expert, how would you describe the building of a rail line to Niger Republic? What are the economic benefits of that, especially as inter-city rail lines are non-existent?
I don’t know our former President’s real interest but it was not supposed to be a priority issue as at when they promoted it.
We have gone past that stage. What is Niger producing that Nigeria consumes and vice verse?
We sell oil. I am not sure if they buy from us but they used to be noted for allowing our subsidised fuel get smuggled into their country.
It will help for further economic integration and if properly harnessed Niger and Nigeria can maximize the potential of our inland dry ports in Kaduna, Kano and Katsina for passenger and goods movements using the rail. I agree it has advantages but not really a priority issue when it was promoted and funded.
What should have been of higher priority, in my opinion, is linking all the major cities in Nigeria by rail for seamless and cost-effective transportation to boost commerce.
It’s not too late. I hope some day we will rise to fix that.
The Cabotage Vessel Financing Fund is yet to be disbursed to local shipping firms. What are the implications of the delay on the industry?
The implication of that delay is that indigenous investors have missed a lot of business opportunities.
International and local trade are not waiting for anyone. Transactions in moving wet cargo like oil, bulk cargo like wheat, containerised cargo like tiles, RoRo cargo like cars are happening on daily basis.
The world did not stand still to wait for indigenous Nigerian shipowners. Shipping is going on, deals are being signed and profits are made by the parties. We, Nigerians are the ones wasting our time with back and forth stories, excuses making us lose out in the lucrative maritime trade.
Meanwhile, we consume a lot of cargoes but our citizens don’t have ships and the wealth from shipping doesn’t come much into our country
Do you think sourcing $3.2 billion for NCS modernisation will address trade needs of the country?
I spoke against that deal in 2021. The desperation Buhari government and Col. Hameed Ali pushed into it was alarming.
Ask yourself, where on earth is $3.2 billion being borrowed to modernise Customs for a heavily indebted country like Nigeria?
I won’t dwell much on it because the matter is in court and very controversial but let me say this again that you can automate the entire public service system with that amount.
If Customs takes $3.2 billion for modernisation alone, Immigration takes such huge loan and other agencies do same, it’s as good as mortgaging the future of our country.
Before Hameed Ali came, Nigeria Customs was already modernised and gone paperless. All we needed was upgrade areas that required improvement because technology, artificial intelligence, robotics and even the latest ChatGPT evolve and keep improving.
We already had a robust Nigeria Integrated Customs Information System (NICIS)that was up and running with many government agencies getting hooked up through seamless integration. There was no reason to drop it.
The $3.2 billion modernisation project won’t help us, it will worsen our economic situation and enslave us in repayment for 20 years. That is two decades of debt in an uncertain international business climate where we rely only on crude oil sales whose price fluctuates.
Please draw an industry scale of priority for the incoming transport and finance ministers.
I am deliberately relating my agenda for them to the port. Firstly I will suggest that both ministers work closely to advance our national economy through port reforms by evolving a port community system, otherwise called single window.
It is in practice in Benin Republic and working flawlessly. They should bury ego, understudy and replicate the webb port system that is being used in Cotonou. We don’t even need any foreign loan to achieve this.
Customs is under Ministry of Finance while most of other government agencies in ports are under the transport ministry. Their inter ministerial synergy can put a stop to the unhealthy rivalry we have witnessed in the past where government agencies work like rivals instead of being partners.
Is Nigeria ready for AfCFTA, what are the gaps to be filled?
Before I talk about Nigeria’s readiness, let me talk about Africa’s preparedness. At the risk of sounding pessimistic, Africa is seriously challenged from the intra African trade perspective.
The 47 countries that have assented to the AfCFTA have not relaxed their visa policies. As a Nigerian business man, I can’t travel to any South African, East African, North African or Central African country visa free.
I must go through some cumbersome visa processes and procedures which sometimes get frustrating.
We also don’t have a common means of transactions outside the United States dollar. We are talking of a common market to address exchange of goods and services for 1.2 billion people in the African continent but subjecting ourselves to using the dollar.
Let’s look at security and political tension .Within West Africa, Guinea, Burkina Faso, Mali and Niger have military governments and are presently burdened with various economic and other sanctions.
Trade responds to politics and policies. Any statement from political leaders can either strengthen trade or cause it to quake. I can cite instances. Recent decision by ECOWAS directing member countries to shut borders to Niger Republic after the coup and the country’s severing ties with France resonates in various global trade arenas.
Five of the leaders that signed the AfCFTA treaty in West and Central Africa have been displaced. I am also counting Idris Deby of Chad who died fighting insurgents and the Chadian military installed his son as president with the backing of France.
There are internationally connected militants linked to Al-Shabab, ISIS and ISWAP in various parts of Africa. In Nigeria there are up to three factions of Boko Haram.
You are aware of the Sudanese challenge too.
Let me say the Africa Union and other regional political or economic blocs like ECOWAS and ECCAS must evolve standing forces to achieve internal and trans border security.
Without adequate security across the maritime and land border areas, trade cannot flourish seamlessly in Africa. There are beautiful speeches coming from AfCFTA Secretariat in Accra and other members of the continent’s trading community but they have limitations because those who run the various states may not align with pro trade ideologies.
There are economic challenges – African states go cap in hands looking for loans to plunge themselves into debts to survive daily. Because their economies are tied to loans and foreign aids, they are obliged to trade more with their creditors or donor countries.
An indebted country , like an indebted person cannot be independent and enjoy true liberty. How can a debtor looking for more loans and in some cases seeking debt forgiveness trade ?
Some African countries are using their natural resources to pay debts. It’s that bad.
Let’s now talk about Nigeria’s readiness. Nigeria is hungry and lacking in many basic things. Just recently the president declared an emergency in food production. We don’t have enough food. What are we going to trade with other African countries?
I read last two weeks that six farmers were murdered in Kaduna in their farms with forty others abducted. How do you have enough food when farmers are not safe?
As a country, we have good land to grow rice and wheat but we rely on foreign rice, though smuggled, and we worry for price of wheat occasioned by the Russian invasion of Ukraine.
Our ports are not ready. We had anticipated that Niger and Chad will patronize our dry ports but political instability has set in.
Even when normalcy is restored, it will take some time to rebuild traders confidence along that route.
We have not been able to enjoy the maximum benefits of ECOWAS Trade Liberalisation Scheme ETLS, now we have a bigger opportunity in AfCFTA.
We need to work harder to seize the opportunity by first making our country safer. Nigeria has potential to export food but today the country is declaring emergency in food production.
We were exporting some things to other African countries before AfCFTA. I believe we can do it if we get our systems right but sincerely, we are not truly ready
You seem to have so much confidence in the new CG of Customs to transform the service , what informs your stand? What are your advice to him on what should be done immediately?
I have known Adewale Adeniyi for over three decades and I am convinced this is one of President Tinubu’s best appointment.
He has a track record of professional excellence as a customs officer and has worked closely as spokesperson for 6 CGCs. He is a fast learner who understands the pitfalls of past customs leadership and will right the wrongs.
Firstly ,I want him to distance the Nigeria Customs Service from the $3.2b modernisation project. It is a white elephant project.
There is also the urgent need to streamline and better organise customs operations especially with multiple checks. Nigeria is the only country where customs will examine and exit a cargo from the port and the same customs will waylay same cargo on the road for reexamination.
NCS is a trade organisation involved in import, export and manufacturing for excise duty collection. The former administration created unnecessary gap with the trading community in Nigeria and I know Adeniyi can bridge it.
There is the need for the new CGC to improve capacity building of the NCS officers and it’s trading partners on modern customs procedures with a common end to end platform that will integrate all stakeholders technologically.
Adeniyi has started well trying to address immediate challenges and I know he will surpass expectations.
There are infrastructural gaps that should be filled. Customs lacks basic operational facilities like laboratories and drones for border patrol.
Adeniyi is a cerebral and upwardly suave individual with the capacity to deploy managerial skills in turning the customs around.
