N258bn port reconstruction project missing in 2023 budget

Findings have shown that the Federal Government failed to capture the Apapa and TinCan Island port reconstruction projects in the 2023 budget presented to the National Assembly last week.

In the budget, the sum of N20m was allocated for agencies under the Federal Ministry of Transportation such as Nigerian Ports Authority, Nigerian Maritime Administration and Safety Agency, Maritime Academy of Nigeria, Oron; and Nigerian Shippers Council for other consultancy services.

Meanwhile, agencies like MAN in Oron and the Council for the Regulation of Freight Forwarders in Nigeria got N1.5bn and N775m respectively.

It will be recalled that the Managing Director of the Nigerian Ports Authority, Mohammed Bello-Koko, had said that a whooping sum of about  $600m (N258bn) was  needed for the rehabilitation of Nigerian ports. However, this figure was not captured in the budget as only N10m was allocated for implementation of strategies for the rehabilitation, utilisation and patronage of Eastern ports.

The seaports being considered included: Apapa, and Tin Can Island Ports in Lagos; Calabar Port in Cross River as well as Warri, Koko and Burutu ports in Delta State.

Bello-Koko had said that not all the terminal operators had the financial capacity to handle the reconstruction of the quay aprons.

“Like I said before, not all of them have the financial capacity to reconstruct because it is no more rehabilitation but full reconstruction. While some of them might be able to have financing in the next few months, others might not be able to meet up and then you need to have uniformity in terms of the construction plans and so on. We also didn’t want the terminal operators to come up with their own engineering designs.

“So, we are coming up with a holistic engineering design of the ports. When we do that, we also have an estimated cost of over $600 million. Now, we are looking at the funding options. The first option is for the terminal operators to reconstruct those berths. Either we give them time to recoup their investments or we extend their leases.

“The other alternative is for the NPA to reconstruct those quays and to do that, we are going to fund it ourselves. We are working towards requesting the government’s approval to use a certain per cent of our revenue to fund the reconstruction of Tin Can.

“We are just being proactive. When the government decides to go that way, we know that we have already done some of the work. The other option is to just get a multilateral lending agency to fully fund that reconstruction. The FMOT has been pushing and giving timelines in terms of the starting of the reconstruction of Tin Can.”

Meanwhile, a source close to the NPA told THE PUNCH that though one of two terminal operators wanted to undertake the project, it was still the responsibility of the ports authority.

“It is the responsibility of the NPA. The agency is looking for funding options. Some terminal operators like one or two want to undertake the project, but if one person does it and the other does not do it, there will be distortions of the whole system. This is why NPA wants to do it itself. So, if it is not in the budget, I don’t know who they want to do it with.”

Reacting to this, Vice President of Business Action Against Corruption, Integrity Alliance, Lagos, Jonathan Nicol, questioned why shippers were charged a seven percent development fee if the ports would not be developed.

He said that it was the duty of terminal operators to develop the terminals.

“Shippers pay a 7 per cent surcharge for port development levy across the country. The 7 per cent surcharge is a levy for every cargo that comes into the ports. Shippers have been paying that levy for 30 years. It is enormous money for development of the ports, which has not been used, looking at the state of the ports. The question is, why do shippers have to pay for port development levies when the port has been concessioned. This is because concessionaires are supposed to develop their own spaces at the ports, which they rented from the Nigerian Ports Authority. It is their duty to develop them and not that of the shippers to do it for anybody.”

Nicol said NPA had the right to request money to develop the ports from what they had been paying to the government.

“The NPA has a right to request funds from what it has paid to the government. If the government is saying they are not going to fund the NPA, NPA has the right to hold the funds and remit part of what they collect to the government and use the rest for salaries and development of the ports.”

According to him, “With the way it is, if care is not taken, the NPA might increase its tariffs. Government is introducing, increase the cost of doing business instead of decreasing it. The 7 per cent surcharge is a levy for every cargo that comes into the ports.”

He said that the government was increasing the cost of doing business instead of reduction, noting that it was not healthy for port development.

“The government is increasing the cost of doing business instead of decreasing it.”

Meanwhile, the General Secretary of the Association of Bonded Terminal Operators of Nigeria, Haruna Omolajomo, lamented poor infrastructural maintenance by the government, stressing that it was not good for the growth of the industry.

“As far as I am concerned, it is very painful that the Nigeria government, through its agencies and other parastatals, is very poor in maintenance culture. If infrastructure is not obsolete, decayed, collapsed   or totally dilapidated, no one will be bothered.”

According to him, “Even where budget provisions are even made, the money would be diverted or cornered by some bad eggs in the country.”

According to him, “One is therefore not surprised to see the dilapidated ports and quay aprons of our premier ports, especially those of Lagos ,TinCan  and Onne just to mention a few. They are not being attended to or accommodated in 2023 budget.”

Omolajomo noted that the government was only concerned when the crisis involved the big men and the powerful in the society.

“But let there be a disaster or killing  that involves one of the big men in the governmental or higher authority, you will see the speed with which those in authority would put things in order.”

He said that a state of emergency should be declared on the dilapidated quays aprons at the ports.

He added that if the matter was not taken seriously, it would attract international maritime operators.

“In actual fact, without further delay, we have suggested, and we are still suggesting that all the dilapidated ports and a state of emergency should be declared on quay aprons in the above stated premier ports. If this is not done or taken seriously, it will soon attract international maritime operators or the world in general.”

According to him, “Our premier ports can be declared a no-go area or unsafe for foreign investors and vessels. This will definitely have adverse effects on the people, the government and our economy that is already down.

“It is not yet too late for the Minister of Transport as well as the National Assembly to do the needful now. Let them quickly accommodate these facilities involving restructuring in the 2023 budget.”

He urged the government to use the time of concession renewal to ensure that the terminal operators participated in improving the port infrastructure.

“Like we suggested, there is a need to review the renewal of the concessionary agreement with the current terminal operators. They should be made to show concrete commitments and make money available for the restructuring of these dilapidated ports.

“They cannot just be milking the country and carting away the money they get freely to enjoy themselves somewhere else.”

According to him, “The premier ports of Apapa and Lagos and the newly constructed Lekki port are advantages to these agencies to get adequate funds and funding. The Lekki port will definitely be a huge economic blessing not only to these agencies but also to the people of Nigeria. These agencies would definitely get a lot of money from the barge operators, truck owners, agents, importers , indigenous bonded operators around the axis . Business will definitely blossom in this Lekki port axis.”

(Punch)