President of Shippers Association Lagos State (SALS) was recently tracked down by our correspondent in Apapa Lagos. In this interview, he talked about the viability of the recently commissioned Baro Port in Niger State and what could be done for other existing ports in the country to become viable.
What are the challenges you faced in 2018?
Nothing has changed, the situation still remains the same, when it comes to cost of doing business in our environment, nothing much has changed, first of all, we don’t have infrastructures in place, it is a shipper that built Apapa-Wharf road, Dangote used to be the president of Shippers Association before I took over and he is the one that built Apapa-Wharf road, this would tell you the amount of decay in the system, if Dangote can do that, in order words the government has failed to implement what we call infrastructure round maintenance, they are not maintaining their infrastructure or building new ones, they are not encouraging Shippers, so nothing has changed, but we are working hard to bring some of our traders back to our port.
Recently the government commissioned Baro Port, they had in the past commissioned Onitsha but it was not put to use
The River Niger has its natural course, during the dry season, the draft would be low, and when the draft is low, there is no way you can even use barges, so between Patani to Onitsha, you can only thrive during the raining season, this has a way of feeling the gap naturally, during the dry season, you would see heaps of sharp sand on the areas that have been dredged, it is natural and there is nothing anybody can do about it, it is only when we are able to build an infrastructure that would control the natural flow of the sand, then we would have free flow of water from the River Niger to Lokoja, Baro and so on, that’s when we can now say we have ports, for now, Onitsha Port is suffering the same thing.
But why would government spend so much money when they know the challenges?
We are working with politicians and they always want to make a name from nothing, it is on paper now that Baro Port has been concessioned, but what about the functionality? So, Baro Port is a game of the politicians.
What about continuous dredging, could this not bring solution?
It is a very expensive thing to continue to dredge the River Niger all through to Lokoja, I don’t think government would want to do that. The alternative is for them to build the existing ports, Warri Port is there, it has not been refurbished or reconstructed, they should use the existence into workable channels where we can now confidently send vessels to Warri to discharge, they should put infrastructures in place for the sustenance of the port system, outside all these, we would continue to wallow in great disaster where our ports cannot meet our needs.
Government is now getting private investors to concession these ports to, are we now saying they may not likely get?
The question we should ask ourselves now is; has concession helped Nigeria? This is a question you can confidently answer yourself, we are still battling with the concessioning of our ports to certain interested parties in this country, it is not that they cannot do what is right, but because there is this government policy that always summersaults, if they want to do the right thing, they can do it, if they want our ports to work, they can do it, in Ghana they don’t have all these problems we are having here, so why can’t our own work? It is because we have policy somersaults and this is the major decay in the process of government. We do not have professionals to man the maritime sector, when they come onboard, they start to learn, they start to read, they even bring half-baked individuals who don’t know much about the port sector, and these are the individuals who advise them on what to do.
The shippers Council has said it wants to start registering operators and collect charges, what is your take?
I was in that meeting which took place at Golden Tulip Hotel, if you look at maintenance of the port system, Shippers Council has been the only non-revenue generating outfit, and now they want to become an economic regulator, I understand they are going to be private driven, so they have to make sure that they sustain the tempo of being a regulator, they have to raise funds to meet up with their obligations, and registering port operators is one of those things that would help to build their revenue base. I must say that we are port users and all of these structures supposed to be in place before you can now say you are a maritime nation.
We have had so many regulators in the port system and it is affecting us now because of the outlet of funds from the pockets of shippers is so much. N6,000 to support Nigerian shippers Council is a burden but it is one of the sacrifices we need to give for their sustenance, otherwise they might not be able to give the kind of regulation that we want.
It would be a disaster if the e economic port regulator is compromising with other port users to generate funds to run their affairs.
We did not reject this because we feel it is something we can manage, but one thing we reject is having too many regulators in the system, we expect some regulators to withdraw their services because the Nigerian shippers Council would be doing exactly what other regulators are doing.
Which of the regulatory agencies do we have presently that you feel they should withdraw?
If you look at the freight forwarding aspect, the Nigeria Customs is regulating the freight forwarders or Customs Brokers, and they are paying so much as N210,000 for renewal of operational license, this is absurd, we use to get this license for N10 in the early 80s, from there it was increased to N10,000, to N20,000 and now to N210,000, when you renew your license and the business is not there for you to recoup your money, it means you are being pushed to do terrible things, so the Nigeria Customs Service has to bring down their cost of renewal, it is absurd.
We also have NIMASA doing their own regulations, we have NPA doing their own regulations, we have Standards Organization of Nigeria (SON) controlling standards, we have NAFDAC, and now we have the Nigerian Exports Promotion Council, all these are payments from the pocket of shippers and exporters, by the time you put them together, you still pay your Customs duties, shipping charges, terminal charges and transport, at the end of the day, the profit margin of the shipper is gone.
The essence of all these regulatory agencies is to control the excesses of port users, but are we controlling them now? The answer is No, so it all has to be streamlined.
This year, we have also heard the customs advocating that the 35% levy on vehicles should be removed
The marching orders of the president to the CG of Customs was to go to the port and generate revenue, unfortunately trade facilitation is not part of it, because if you are talking about trade facilitation you are talking of simplifying business, simplifying business is part of Customs duties, we don’t see why government should increase its automobile taxes when we are supposed to be a free trade world, the world is moving fast but we are dragging ourselves backwards, so for the CG to come out, he must have really understood the situation on ground and he is beginning to see why people were agitating for customs duty to be reduced.
We are still a tariff nation and I am hoping that sooner or later we would leave this regime of tariff and enter into the free trade world. However, all of the regulatory organs must function properly, including the Nigeria Customs Service, the question of banning rice which is a staple food for the ordinary man should not come up, yes we need to manufacture and export but you cannot export what you don’t have, it is when you have more than enough to feed your people that you can now think of export, you are exporting your yam while your people do not have enough to eat, I think with time, we would outgrow this level of want because right now, people are really going through harrowing experiences.
The 7% Port Surcharge is enough that shippers are paying to support government, all other levies are a burden on Shippers and importers, all of these excessive charges should be stopped because we really don’t know what government is doing with the money, if we cannot get good roads, water and electricity or transportation, and people bring in cars and you are levying them 30% additional, so how much are we going to sell the vehicles? Volkswagen car them was N1,500, Peugeot was N2,500, that same car is what we now buy for N7 million, the difference is too much.
If the CGC is now supporting us now by calling for the reduction in the cost of doing business, we would support him because this would help vehicles to come into this country. I think it was a vice decision for him as Customs CG to have called for a reduction in Customs levy, they should even abolish it.
On rice import, do you think the tariff should also be brought down?
It is the duty of government to feed its citizens, it is not the duty of government to deprive them of their staple food, those days, garri used to be the staple food, nowadays, rice has taken over garri, so if you deprive Nigerians of their staple food, what is the use of government?
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