• Monday, July 15, 2024
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Africa must improve interconnectivity between ports to promote regional trade, says Bello-Koko

Tinubu’s policies driving growth, revenue in maritime sector –Bello-Koko

Mohammed Bello-Koko is the managing director of the Nigerian Ports Authority (NPA). He was recently a special guest at the maiden maritime conference organised by BusinessDay Media Ltd. in Lagos, where he participated as one of the panellists.

He identified poor connectivity between African ports as one of the biggest barriers to inter-regional trade, despite existing trade agreements. He also called for seamless trade relationships between ports by creating an enabling environment for shipping companies to develop dedicated trade lines for ports within the continent.

At the end of the conference, he had an exclusive interview session with BusinessDay’s Amaka Anagor-Ewuzie, where he gave insight into the operations of the Ports Authority as regards port automation, export promotions, and plans to sustain sanity along the port corridor. Excerpts:

I spent three years in office as the managing director of the Nigerian Ports Authority. How would you assess the past three years, and what moments were most defining for you?

What was most defining for me was the start of operations at Lekki Port. The last time we had a new port either constructed or come into operation was probably over 70 years ago.

Being the Managing Director of the Nigerian Ports Authority, who was there to see to the conclusion of Lekki Deep Seaport, the first deep seaport in Nigeria, operations began, and some of the largest ships ever to call any Nigerian port and even the whole of West Africa visited Lekki Port, which was very defining for me.

Another defining moment was being able to see an increase in efficiency in our ports. Today, we have achieved higher efficiency in our ports, such that cargo dwell time and ship waiting time have been reduced. There has been a fantastic increase in revenue collection and a subsequent increase in the amount remitted into the Federation account. These are quite defining for me.

“There has been a fantastic increase in revenue collection and a subsequent increase in the amount remitted into the Federation account.”

What investments are needed in infrastructure and logistics networks across Africa to improve efficiency and capacity to handle increased maritime traffic?

First, we need to rehabilitate the ports. Our ports are a bit old, and we need to expand the berths to enable bigger vessels to berth in our ports. To ensure more efficient services, bigger vessels need to be calling our ports, and economies of scale will set in.

There must be investments in other logistics value chains in the maritime sector. We do not have ship repair yards, and if we can achieve that, it will enable us to achieve greater efficiency. It will turn Nigeria into a one-stop-shop by allowing a vessel to drop its cargo no matter the size; it can be serviced and catered for here.

So, there are multiple investment opportunities that we can harness to improve efficiency. We need to digitise. Various terminal operators and stakeholders have different IT deployments, which is why the federal government has mandated that the plan of deploying the national single window, which has been there for almost 10 years, come to life now.

Under the leadership of the Minister of the Marine and Blue Economy, the Nigerian Ports Authority is planning to deploy the Port Community System. We have gotten the International Maritime Organisation (IMO) to lead us, and I believe if we do that, it will become the catalyst for the deployment of the national single window.

Other investments need to come not just in Nigeria but in the whole of Africa. Most of the African ports cannot compete favourably with ports in Europe due to their shallow draught. Irrespective of what we are spending in Africa, we are still not competing, and in the value chain or the international maritime sector, your weakness is where the weakest link is. Africa is the weakest link when it comes to efficiency in ports around the world.

Aside from infrastructure, we need to reduce human interaction through digitization. We currently have situations where you have multiple government agencies at the port, and some of the government agencies also have multiple desks.

But I think the Minister has requested that we shrink the number down to four government agencies, and if we’re able to do that, it will bring efficiency. We also have interference and overlap in the functions of government agencies, and it happens not just in Nigeria but in most of the African ports.

In terms of security, the Deep Blue Project has taken care of that, and they are doing a fantastic job. All the ports in Nigeria are river ports, and their channel is over 100 kilometres long. Because of insecurity, it becomes difficult for vessels to leave or sail, especially in the southern part of the country. This is why some ships use private security firms that get involved in maritime security to provide them with security while on the channel.

The NPA has been on course to actualize the Port Community System in line with the IMO’s mandate that ports globally must be automated by 2025. Where are we on this?

The deployment of the Port Community System is what has been on the plan of the Nigerian Ports Authority for over 10 to 15 years. So, when we came on board, we realised that getting a consultant to even give us the necessary information was a major challenge, so we decided to contact the IMO, and they willingly did that.

It is divided into five phases. IMO paid for two out of the five, while the NPA paid for the other three. So, both the interim and final reports are ready. They have been submitted, and we are at the point of procurement to determine a competent company that will be able to deploy. We believe that within the year, we should be able to test-run a port community system in our port.

In terms of port infrastructure upgrades, how much progress have you made in securing funding for port infrastructure rehabilitation?

We have already secured funding for the rehabilitation of Tin-Can and Apapa Ports. We are signing the final term sheet for the funding for the rehabilitation of the ports in the east, including Onne, Rivers Port, Calabar, and Warri Ports, as well as the repair of the Escravos breakwater. These are the infrastructures that would be rehabilitated.

So, funding for Lagos is ready, and I can say that it is 90 percent sure because we have signed the mandate letter and the term sheet. It is now with the DMO and the Federal Ministry of Finance, and they will work with the Minister of Marine and Blue Economy.

The export processing terminals set up by the NPA have been around for a while. How has it helped in promoting non-oil exports in the last year?

The setting up of those Export Processing Terminals has created a one-stop-shop for exporters. This is a location where you bring in your exports, test them there, package them, certify them, containerise them, seal the container, and send them to the port only when the vessel is ready for the voyage. That has reduced time and wastage. We have seen a spike in the percentages and volume of exports as regards non-oil exports, and we are quite encouraged by that. We are monitoring the performances of these export processing terminals.

We are also working with Nigeria Customs to see that the export desk at the various port locations is collapsed and only one export desk by Customs should be used. That way, when the exporter finishes at the export processing terminal, the person would know that the Lilypond export desk must certify the export even if it is not from Lilypond. So, once you get to the port, no one else will stop the cargo and the export will go straight to the vessel. That will reduce time.

You visited China recently for the Lekki Port Board meeting. What other success story should Nigerians expect going by the outcome of that meeting?

In the second phase of Lekki Deep Seaport, there is supposed to be a liquid bulk terminal, and we expect that they are not going to wait to start the second phase. There are already proponents and funding options for them to do that and lease it out to get it to work.

We went to China not just to discuss with the investors but to discuss with the funding bank, which is the China Development Bank, and discuss the successes so far because it has been barely a year since Lekki Port commenced operations.

We believe that once we are ready to go into the second phase, the bank will give a nod that they are impressed with what is going on so far. There are a few glitches here and there because it is a new port and the first deep seaport, so it is expected, but so far so good.

What is the update on Badagry and Bonny Deep Seaports?

There are many proponents of various deep seaports. What we have done is to be calling them one by one to get updates. It takes a lot of time. They have investors, stakeholders, shareholders, and others. But Federal Executive Council approval has been secured for Badagry Deep Seaport, Snake Island expansion, and the port of Ondo. Those once are ready, and we are discussing with the proponents of those ports and the investors.

We believe that by early next year, at least one of those deep seaports should have started construction.

The recent directive from the Federal Ministry of Finance that 50% of NPA’s IGR will be deducted going forward. How is this affecting your operations, especially with the NPA having obligations to meet in terms of maintaining port infrastructure according to the concession agreement?

It has affected us in very many ways. It’s been quite difficult to operate, but we have the listening ears of our supervising Minister of Marine and Blue Economy and then the Minister of Finance. We made the case that it is important to look at that again. You know that policies are to ensure that the government gets revenue, but we believe that there should be exceptions because our case is quite different.

The Nigerian Ports Authority needs to spend to get revenue. We have expenditures that are tied down to revenue because if you don’t spend that money, you won’t get the revenue that you expect. There are some expenditures that if you don’t carry them, the port would not be efficient, and you wouldn’t be able to compete internationally. You would even be going against some of the IMO’s regulations if you didn’t offer some services because of a lack of funds. But we are working on it, and I believe that very soon it should be resolved.

Overcoming trade barriers and unlocking economic growth are the topics of today’s panel discussion. Tariffs and volatile exchange rates are the biggest problems in Nigerian ports today. How is this affecting volume and revenue generation?

Because of the volatility of the exchange rate, we all know that by opening Form M, importers know the cost at which they are bringing the cargo into the country, and then you just see that there is an increase in customs duties because of the exchange rate. So, that has affected the number of imports that are being brought into the country.

It has affected the importation of raw materials and necessary spare parts for industries. This has also led to importers abandoning thousands of containers in our port. They are there, occupying commercial spaces. That effect is there, and we expect that it will happen because exchange rate volatility and inflation are affecting the purchasing power of Nigerians.

How can all regulatory agencies collaborate to promote efficiency at our ports?

The Minister of Marine and Blue Economy has made it a point to visit the Comptroller General of Customs and the Minister of Finance. The CG Customs has committed that we will work together to ensure that all non-tariff barriers, those trade barriers that are there because of Customs are removed.

The NPA has been working 24 hours and Customs is about to start as well. Customs examination is going to be 24 hours and we are improving the lighting of the port to enable that. So, that collaboration has improved. As it relates to scanners, we are speaking with terminal operators to see if they can procure these scanners, and then Customs will pay them through CISS.

The ministry has been leading in ensuring that these changes come on and most of these changes are also in the Presidential KPIs which the Minister signed, and then the Minister got all of us to sign and consistently we have meetings to ensure these changes are made.

Now, what is important is for African countries, to look at what every one of them can do to ensure that Africa as a continent has seamless trade relationships. Within Nigeria, we have a lot of trade barriers that are related to tariffs and other processes.

Now, this is where shipping comes in, no matter what kind of barriers you have removed if there is no interconnectivity between the ports in Africa, then sending something to say Cape Town, will require the cargo to first go to Europe before it starts coming down to Cape Town. It doesn’t make sense that is why African countries need to come together.

Start with Nigeria, of course, we need to come together to encourage the shipping companies by subsidising some of their services and that’s what the Europeans do. It’s not about taxing them, if you can’t give them money, don’t take their money to encourage them.

What the NPA did to clear the decade-long gridlock along the Tin-Can and Mile 2 axis of the Apapa-Oshodi Expressway is commendable. How do you plan to sustain it?

Thank you for the commendation but it is not just me nor the Nigerian Ports Authority. It involved my other colleagues including the GM Security, Port Managers of Tin-Can Island Port and Apapa, the Minister of Marine and Blue Economy, the Lagos State Government, the Police, and every stakeholder who was with us.

What we did was to reach out to all the stakeholders, and we kept pushing and encouraging them to work with us and they saw reasons why they should do that and that was how we achieved it.

To sustain this, we will keep monitoring, and tolling away trucks that park on the road, keep ensuring that nobody parks on the road and that decisions we have taken to enforce the use of Eto certificates and licences are sustained. We signed an agreement with other stakeholders and we will ensure the implementation.

Lastly, you were recently named Champion’s Most Outstanding Public Servant of the Year. What does this award mean to you?

It means that we will keep doing more. For us to be recognised, we are humbled and appreciate that recognition. It also means that someone somewhere is noticing what we are doing, and we will keep doing more because it encourages us to do more.

I thanked my colleagues especially other Executive Directors and the entire management team of the Nigerian Ports Authority without whom, we would not have achieved this.

It is not just the MD that won an award because the Nigerian Ports Authority also won an award as the Most Outstanding Government Agency of the Year, and we will keep pushing to get more recognition.