Politics And Reconstruction of Tin Can Port (1)
BY EGUONO ODJEGBA & TONY OHAKWE
If Nigeria’s second and biggest seaport, Tin Can Port was domiciled in saner climes, chances are that the port would have been classified a failed port; for a long time already.
But the port has continued to enjoy full operational status, and strangely, with both foreign and local owned terminals cocooned in their respective areas, saying nothing and doing nothing, which is convenient in as far as the obligation to fix the place is also taken away from them.
By the way, there are insinuations that the conspiracy of silence amongst the terminal operators is nothing more but to promote their business interest, while smiling to the bank daily, scarcely unconcerned about safety and the possible danger of complete collapse some day.
While a few of the foreign terminal operators also have strong presence `in the sub region with similar going concerns in Benin Republic, Togo and Ghana, with proximate advantage of Nigeria’s import value chain industry, they can afford to temporarily move over to these other bases and still have a firm control of our import supply and logistics.
As for the going indigenous terminals, they are what they are, opportunistic Nigerians operators whose elementary economic goals are more personal than national interest. Like a local adage says ‘if the tree branch detach and falls away, the birds on it would always take refuge elsewhere’, hence the current attitude.
Those whose business it is to know say the odious situation has to do with government official laidback attitude, indifference as well as societal general permissiveness, which is believed to be driven largely by lack of capacity, compromise and ineptitude, amongst other factors.
The politics of the rehabilitation of the Tin Can Port is therefore one that challenges the morality of all critical stakeholders, including the government of Nigeria and the respective maritime and shipping nations doing business at the Lagos ports, and not just the Tin Can port.
The urge for huge repatriation of profits by foreign terminal operators and shipping lines, as well indeed the projected profit margins of indigenous operators, plus of course, the chameleonic, colluding attitude of government agencies in the industry, all contribute to the appalling state of not only the Tin Can Port but indeed, others located in parts of the country.
There can be no other reason for the unctuous delays in the timely rebuilding of the collapse quay apron of the trouble port, as every act of delays can only be traced to criminal conspiracy which manifest in official dilly dallying often embedded in lamentations, which are no more than crocodile tears; as the establishment as well as the terminal, shipping companies and other critical stakeholders are united in the conspiracy to stretch the clog as long as it is possible; since they appear to gain more through palliative repairs.
Today, we will focus more on the politics of the federal executive council, the ministries of works and transportation, and the indigenous players in the sordid reality of the failed Tin Can Port, which this federal government have consistently bent double backwards to deny despite the obvious reality.
Every objective assessor and or onlookers would discover that this same style criminal breach of trust has largely been responsible for the dismal performances of the national economy, across sectors, which has continued been suffocating the political economy of this country by the burgeoning inclinations of a narrow minded tribe.
Come with me on a tour of the darkling plain and draw your own conclusion irrespective of my sentiments built on a personal worry that the adventure of a large swarm of incompetent political appointees in our critical sectors may eventually kill Nigeria.
From available evidences, our ports infrastructure started showing signs of weakness through maintenance failure since 1984. Example is the Escravos breakwater channel, even at a time the building and operation of Tin Can Port was at its infancy. While the siltation situation at the Escravos/Focado channels have significantly reduced cargo traffic owing to the uncertain draft to support safe navigation, much revenue accruing from that area of operation has since plummeted.
With estimated N2.5billion daily revenue generation, the Tin Can Port worsening state of disrepair may soon trigger a lowering of its capacity performance, including its revenue receipts.
As concerns continue to rise about the prospect of Nigeria losing some of its major seaports to infrastructural collapse, the Federal Government failed excluded the Apapa and Tin Can ports rehabilitation from the 2023 budget presented to the National Assembly.
Out of the N126 billion allocated to the Transport Ministry, a paltry sum of N10million was voted for proposed for the rehabilitation and resuscitation of the Eastern ports, towards achieving increased activities.
Last week Managing Director of the Nigerian Ports Authority (NPA), Mr. Mohammed Bello-Koko in media reports raised alarm that the Tin Can Port is faced with eventual collapse if no urgent action is taken.
Ordinarily, such lamentation should truly alarm any country, but here is a CEO who has become adept at talking from the two sides of the mouth. While on one hand Bello-Koko draws attention to the looming danger in neglecting to fix the port’s broken down quay apron as quickly as possible, he sooner goes into political hibernation by insisting that the collapse is not imminent.
Bello-Koko who was a guest on a television programme said, “The Port of Tin-Can is collapsing, and if nothing is done in the coming years, there will be many problems related towards doing business there.
While at some point, he has openly admitted to the deteriorating situation of the ports infrastructure owing to terminal operators occasional warnings, at other times, he has prevaricated to the extent his body language also became part of the challenge.
Instructively, as soon as the management executive took the bold initiative to undertake the repairs and reconstruction, as the case may be, and hinted that terminal operators also had a role to play than the latter went into silent mode; effectively ending their occasional complaints.
In the course of further engagements, Bello-Koko hinted of the apparent ploy by the terminal operators to slow down NPA’s access into the terminals in a manner that suggested subtle denial of access, and thus preventing further inspection.
His words, “Before, if I or any of my colleagues wants to go into the port terminals, we have to give the terminal operators two weeks’ notice even when such visits are for inspection purposes.” This is one of the shortcomings of the concession agreement. We have to have an agreement that is fair and adds value for money.”
Determined however to play its landlord and supervisory role, he said at a later date that renewal of port terminal contracts will be based on a financial formula that will contribute towards their maintenance in the future.
“Tin-Can Island Port, we all know what is happening there; the port is practically collapsing. We need to focus our budget towards the rehabilitation of those quay walls. We have taken a holistic review of decaying infrastructures at our ports and have decided that it is very important that we rehabilitate Tin-Can and Apapa ports.
“We are asking the terminal operators…you people have operated these port terminals for about 10 years and 15 years; how much money are you going to invest in these port terminals? We are asking some of them if their leases have expired, how much will they be investing in the ports?
“For us to renew these concession agreements that have expired, about five of them, we need to have categorical commitment from the affected terminal operators on the development of these port terminals. If the terminal operators cannot give us such commitment, then we either give the terminals to someone else or go and borrow money to rehabilitate those ports.
“However, if we go and borrow money to rehabilitate those ports, then what the terminal operators are paying will have to change. The rates will have to go up. If we don’t do that, these terminal operators will keep managing those places, and the ports will keep collapsing. Because of their financial interest, these terminal operators don’t want us to re-construct the affected port terminals because that will mean stopping them from operating.”
That was however, before he granted the terminal operators the subsisting six months contract extension, after initially saying that the licenses of about five of the terminal operators in the Lagos ports whose critical infrastructures, especially quay walls have almost collapsed and are presently undermining ports efficiency will be revoked.
He made it clear that though NPA was in a position to get the required funds to fix some of the broken down infrastructure, it expects the terminal operators to take responsibility for the facilities under their custody. Where they fail to do that, NPA will mobilize for urgent repairs, which may lead to giving the terminal to a new concessionaire.
Without contradiction to the above, the Bello-Koko led management had earlier hinted of a partnership option in which, either the authority and the concessionaires pool resources together at an agreed ratio to fund the rehabilitation; or else consider a third party option to undertake the financing of the project.
The response was deafening as the terminal operators said they have no role to play, purportedly going by the concession agreement. For instance, the management of Five Star Logistics terminal at the Tin Can Island Port Complex which was one of the earliest operators to raised the alarm over the conditions of the ports infrastructure, nonetheless declared that maintenance responsibility lay with the authority.
Five Star Logistics terminal, operators of the roll-on/roll-off terminal at the port operates berths 9 and 10, which cover a total length of 437.03metres, and which cable ditch along the quay apron had collapsed.
General Manager of the terminal, Wolfgang Schneider, had accused NPA of abandoning the collapsed cable ditch, noting that management of the terminal had on different occasions called the attention of NPA to the issue but that the authority failed to take action.
He said, “We are losing a lot of space which could stack up to 100 containers as a result of this collapsed portion and it is pathetic. Any heavy object cannot go along the area because it is very dangerous. The quay wall has to be repaired first before we can fill up the failed portion to make sure that we are not sinking in.
“From the tower light to the quay apron, it is purely NPA’s responsibility to maintain. We have been talking about this with NPA for years but nothing has been done.”
Recall also that in 2019, the then NPA helmsman, Ms. Hadiza Usman had faulted newspaper report purportedly of unqualified persons hired by the authority to carry out welding of the holding beams. Usman who was on visit to one of the daily newspaper’s head office in Lagos said there has been no time unqualified persons were contracted to carry out palliative works on ports infrastructure.
During his latest comment on the state of the ports infrastructure, Bello-Koko listed Escravos, Calabar and Onne ports as those in need of significant rehabilitation alongside Tin-Can port; putting the cost at $800 million.
Again he said, “For the port of Tin-Can, It is not an imminent collapse, but in the next few years, if nothing is done, there will be problems.
“We have been managing Tin-Can and doing palliatives and other jobs for some time now, but it is time we rehabilitate it completely. We also need to rehabilitate some parts of Apapa.”
He continued: “We need to reconstruct the ‘breakwaters’ in Escarvos. It has collapsed for over ten years, and there is a collapsed jetty in Calabar, Warri, Rivers and Onne. There is no port that does not need reconstruction of some of its facilities.”
Recall also the weight of concern and declarations when the immediate past acting Minister of Transportation, Senator Gbemisola Saraki toured the Lagos ports; immediately following the resignation of Rotimi Amaechi.
Saraki had restated federal government plans through the authority for the total reconstruction of the Tin Can Port quay walls, noting that a holistic reconstruction of the broken down infrastructures’ can no longer be postponed.
The entered the outgoing minister, Mu’Azu Jaji Sambo, who despite bustling with patriotic zeal and commitment, was nevertheless constrained by the limited time available for him to walk his talks. Although he quarreled with what he identified as the absence of ‘preventive maintenance’, overall, the minister after the initial reluctance consented to the timely renewal of the port concessions that is expected to provide the fillip that will to upend the current challenges assailing the ports, including the infrastructural deficits.
“I have advised the management of NPA, in the past: there is what we call programmed preventive maintenance. This is why at every port, we have an engineering outfit headed by the Chief Port Engineer. Part of his responsibility is to draw out preventive maintenance programmes for the ports under his jurisdiction every year, take it to the headquarters for consideration and approval, and that forms part of the forthcoming budget.
“If you carry out preventive maintenance, you would avoid a lot of this deterioration that is taking place, this is the truth. The sooner we accept it, the better.
“I personally attach importance to the maritime industry. There are billions of dollars that can be earned from the maritime industry if we get our acts right,” he said.
At some point, NPA accused the federal government of abdicating its responsibility as it affects the maintenance of critical ports assets, but was minded to devise a roundabout way of either getting terminal operators involved in paying for the required costs, or outsourcing the project to accredited project financiers.
Curiously, while the nation stands the risk of losing some of these ports due to official nonchalance and lack of urgency, the Federal Government excluded the Apapa and Tin Can Island ports rehabilitation from the 2023 budget presented to the National Assembly last year.
Left with no other choice, NPA has since settled for third party option which is to outsource the reconstruction of the ports failed infrastructure to project financiers at the proposed cost of $600 million; with $300 million from its own purse.
According to Bello-Koko, the seaports being considered for rehabilitation/reconstruction are Apapa, Tin Can Island, Calabar, Warri, Koko and Burutu ports.
“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 port,” he said.
Speaking through Olaseni Alakija, a former General Manager, Corporate and Strategic Communications, Bello-Koko announced it has brought the board of directors up to date about plans to borrow to fix the broken down infrastructures.
He said while government of Franco phone neighbouring countries fund dredging of their ports, “We (NPA) are responsible for funding ours which put a lot of strain on our resources and capacity to invest in critical port infrastructure.
“With the increasing pressure to remit more revenue to the Consolidated Revenue Fund (CRF) of the Federation, it has become very difficult to have sufficient funds to attend to these decaying facilities, hence the need to explore alternative funding sources outside the traditional port service offerings.”
He said NPA is in discussions with multilateral financial institutions like the French Development Agency (AFD) African Development Bank (AfDB), European Investment Bank (EIB), and Sanlam Infraworks (a Central Bank of Nigeria approved fund manager for InfraCorp) to access long term low-interest credit for port infrastructure upgrades and expansion.
It has since become public knowledge through the grapevine that NPA has signed the funding contract with Afrexim Bank, even as Bello-Koko has wrapped up the terms and conditions of the contract in secrecy.
While it is instructive to note that Afrexim Bank was never in consideration, the decision surrounding its sudden choice remains cloudy. However, while industry pundits believe that the sudden choice of Afrexim may have been politically motivated, perhaps the capacity of this bank to efficiently and expeditiously execute the project and in a transparent manner, remains the greatest worry.