The Nigerian Shippers Council was established by the Federal Government in 1978, to provide a platform for the protection of interest of shippers. How has the council fared in the discharge of this mandate?
There is a need to understand the mandate first. I think around the 1970s was the first time, Nigeria and indeed other developing nations, realised consciously that shipping is part of the economy. Hitherto, government was less concerned with shipping generally. So you have to set up an organisation that would take care of your national interests in shipping. Shipping is international, but there are national interests, so Shippers Council are intervention forces to represent government interests.
So you need to have government intervention to ensure these things are reflected. Shippers Council were set up all over Africa and Nigeria. As a matter of fact, the Nigerian Maritime and Safety Agency (NIMASA) was borne of the Nigerian Shippers Council.
Slowly, the importance of shipping has been made known to Nigerians. Even more importantly, it reflected on the economy. Now you can see all the newspapers talking about shipping. So, that consciousness, that intervention, that protection of Nigeria’s interests is what the Shippers Council has set out to do and I think they have done that fairly well.
DT: The appointment of the council as economic regulator for the ports is a bold attempt by the government. How has your council been able to create a robust port community that provides a level playing field for all players?
This is also a very instructive and important question. When the ports were privatised to the terminal operators, the thinking was, the private sector should lead in shipping, which was very good and revolutionary. Hitherto, it was government that was conducting shipping business in the form of NPA. You could see the inefficiency, the lack of competition and effectiveness. At that time we had indicators that were very large. Nobody wanted to come to Nigeria with his ship because every day you keep a ship it meant you had to maintain it. This reflected on the economy. Goods were expensive because they stayed more at the ports. There was an inflation trend and we were not in charge of that. So, we privatised the ports.
Immediately, there was an impact because international and national investors took over the port and there was a measure of efficiency. However, on the land side of it there were still some chaotic issues. Since the NPA cannot regulate because they are also operators, there was need for a neutral body to look at things. Inevitably, Nigeria Shippers Council was confirmed because even before that, the Shippers Council was carrying out some regulatory actions.
When it came to private sector, even the private sector needed a regulator. So, Shippers Council was put temporarily in charge of regulation. Unfortunately, there have been some issues and litigation which arrested the manifestation of Shippers Council regulatory successes. However, we have to look at it from the context of no one being able to fix tariff without consultation with the council. Also, that Shippers Council spearheaded the port operating procedure so that we would have a path to see what obtains in the port. Hitherto, everybody was doing what they wanted to do without control. A port needs an agent or agency to coordinate whatever is happening and this is what Nigeria Shippers Council has been able to do within its limited powers.
DT: How have you deployed the instrumentality of your reforms towards the new port order to ensure compliance with world best practices?
Shippers Council introduced a new port order which means we have to realise Nigerian ports are in competition with others in neighbouring countries. The shipper has the right, option and choice to take to any port he wants. It’s more of an economic decision. So, our ports must get ready before we say Nigeria is the hub. If a shipper is going to bring his goods, he will nominate the ports he thinks are more economical to him. Also, the port where he’ll sign one form, rather than sixteen.
Also, we need to have automation in our ports. Our processes are archaic, primitive as a matter of fact. We need modern ways of conducting businesses, just like it is done everywhere. You need to sit down in the office or in the comfort of your house and clear your goods. You don’t need to go to the port with the technology and digital applications. You should be able to see the movement of your container or boxes, right from the moment it is loaded on the departing ship from the port of origin, until it gets to its destination. Things should be transparent. There should be efficiency, and government is losing a lot of money through opaque systems in the ports. There has been smuggling of arms and ammunitions, breaching the security of Nigeria. This should not be so.
Nigerian Shippers Council has proposed many things about automation so that we can clear our goods. We are still working on that. We are also going to look at the issue of the Advanced Cargo Information System, which is called Cargo Tracking Note. This, more than any other system, will do three things: It will secure Nigeria because anything you need to import must be known from the origin. If we had the ICT, guns would not be smuggled into Nigeria. Even if they are smuggled, we would know. Then, we know the value of the cargo. The ICT will give the customs the right information to levy the correct duty.
DT: What roles do the Nigerian Shippers Council, Ports Authority, Maritime Administration and NIMASA play at the ports, and how are they all related?
They are all agencies of the Federal Ministry of Transportation. It was a tripod with Nigerian Shippers Council representing the cargo, NIMASA representing the ocean and NPA representing the ports. These are the three canons of shipping. Among all these, the primacy of cargo is very important. The ship and the port are of no use without the cargo. This entire struggle is because of the cargo, which determines everything.
The Nigerian Ports Authority, which is the landlord now, is responsible for common user facilities in the port. NIMASA is in charge of administration, safety and security. Nigerian Shippers Council is the umpire, the referee who is high up looking at all the activities of the system.
DT: The House of Representatives recently passed a bill for the Shippers Council to transmute to National Transport Commission. What should Nigerians expect from the new commission when it eventually takes off?
The National Transport Commission is a multi-sectorial, economic regulatory authority. It looks at all the modes of transport, from the sea, road, rail, and perhaps aviation, so that you have a common economic denominator. If we have a multi-model transport system, there must be somebody who will supervise the juxtaposition, that is, the integration of these modes. What we need is a seamless transport system. If eighty per cent come from the sea, they will be offloaded to trains, trucks or inland waterways. Whatever you do, there must be some link or integration of the transport system. The National Transport Commission will be responsible for looking at these.
It is a welcome development. If it has the powers, financial independence and resources, then it is going to make transportation easily efficient and drive the economy. The transportation industry is very large. It has the effect of changing the country forever because even oil and gas cannot work without transportation.
If we get our act together and get NTC in good standing, we will see that transport would surely contribute more to the GDP of this country.
DT: How would your new status as the regulator of the entire transport sector enhance the efficiency of the nation’s ports, enabling them to compete with neighbouring ports?
To emphasise competition we have to be conscious of the fact that we need to grab cargo from our competitors. By doing so, we have to improve on our efficiency, transparency, smoothness of delivery of cargo and, of course, the ships. First of all, we need to make everybody conscious of the competition and provide incentives to importers. We have ports in the Eastern part of the country that need patronage. We don’t need the congestion. As a matter of fact, the port is not a place for storage of cargo but a transient point. We want the cargo to come to the port and be released as soon as possible. That is one mark of efficiency. We also need cargo not to be stolen or short landed, security of cargo and our borders so the sea will not be access to insecurity in Nigeria. So it is important that the importance of the port where ninety per cent of cargo comes through is recognised.
Nigeria needs to be the distribution centre of cargo all over. That should be our target now. We do this, not by only providing liabilities. There are also some economic diplomatic issues which Nigeria should be serious about. Sometimes people take their goods to other countries because those countries relax certain things that we cannot allow in Nigeria.
DT: How have you been able to contend with the complex nature of your mandate as the nation’s economic regulator at the ports?
It is complex. The most important thing is to get the recognition and support of the government. I think government should make conscious, concerted and deliberate efforts to look at the port and empower Shippers Council to do its work. We are getting support from the Federal Ministry of Transportation, but we also need more support from other agencies. We have been able to work with Nigerian Customs, which is a very progressive organisation, a wonderful working relationship with NIMASA because we have benchmarked their major source of revenue. We are also working with Road Safety Corps and other agencies.
It is important we work with them, but what is difficult is that Nigerian Shippers Council is no more representative of cargo than it is of the operators. We are neutral, which is very important.
DT: Dry ports are meant to operate at centres to receive cargo. What are the advantages of ICDs to the common man and when will they commence?
The dry ports are bringing shipping to the doorsteps of the common man. It’s reducing the cost of transportation and also a centre for export. Many things are done because of the logistical problems. The process of export is tedious, and so the contribution is to bring the port near the people. The definition of a modern port is where goods are loaded and discharged. You need not have any water element or maritime. So a dry port is as good a port as Apapa. It is a port of origin and destination, a port of loading and discharge.
Again, you have to work with the Customs, because the goods will be examined, not in Lagos or Port Harcourt, but in, for example, Kaduna. You pay custom duty there. So, they are just transported from the sea, directly to the port. We have them in five locations. Unfortunately, their development has not been even and rightly they couldn’t have been.
We have now signed new agreements with the concessionaires and have already given them a kind of subtle warning that the concession will be revoked if we don’t see any progress. Kaduna is operating now as a dry port, but there are a lot of things to be done. We have the support of the governor of the state. We want to make it a kind of industrial hub. Kaduna has the best ginger but they cannot meet export expectations. Before you export, it goes bad, so you need to have processing plants.
DT: You have consistently maintained that a reformed port system can earn Nigeria more revenue than oil. What are the potentials of the shipping business in that regard?
First of all, all the earnings of Nigeria, apart from the Customs collection, come from the transport system. That is even now when it is murky and not transparent. You still have Customs collecting billions, which is a substantial part of the revenue. Now, if we get our act together, deployment of ICT and automation and right processes, then you will see that it will quadruple or even more. When we build new ports, we will attract more ships. For every ship that ends up there there’s a three per cent levy on the gross registered tollage of the ship.
So, for every cargo that comes there will be something to give to the government. If you enhance this, you are bringing revenue, rather than enforcement. If we do that, we are talking about, maybe 12 billion-dollar per annum industry, which will finance the budget of this country. But the government has to come up with a deliberate policy. It has to look at the port industry and put strategic issues on it, to be mindful, including the shareholders and everybody. This is what we are trying to do, telling the government to come and look at it.