Questions about Port Concessioning
By Andrew Airahuobhor
Sunday, April 20, 2008
The House of Representatives Committee thinks many things were wrong with the privatisation of Nigerian Ports, and wants to probe it; but the Bureau of Public Enterprises says it's blackmail
Members of the House of Representatives Committee on Privatisation and Commercialisation are angry at the manner the sea ports were concessioned to private operators. The ground of their anger is that there was no enabling law at the time the exercise was done. They are, therefore, poised to investigate the entire exercise. As part of this, they have commenced a fact-finding tour of the ports from last Monday, April 14.
During their tour of the Lagos ports last week, the committee members observed that some of the concessionaires had not even invested in the development of the terminals concessioned to them. For some, only painting of the properties inherited from the Nigerian Ports Authority, NPA have been done.
The members expressed their displeasure over the concession process. They said port concession was laden with irregularities and illegalities, as there was no legal framework to back it.
Abbas Braimah, deputy chairman of the committee, said they would soon conduct an investigative hearing on concession because a lot of Nigerians have expressed concern at the programme. There were allegations and petitions received that many of the concessionaires have not paid lease fees and for machinery inherited from the NPA. Braimah said they had serious issue with respect to payments, which would not be taken lightly. He said that nobody would be allowed to deny the country of its economic benefits. Chukwudi Mayor Eze, a member of the committee, told Newswatch that although the idea of privatisation was noble, the committee, would like to determine if the process adopted during concessioning was in line with the laid down rules and regulations. He said they had received petitions from importers, from those who were part of the bidding process who believe that due process was not followed. "We didn't want to sit down in Abuja and apportion blames. That's why the entire committee came here to see the whole process and then go back to ask pertinent questions on how and where things went wrong," he said.
Njida Gella Ahmed, another member, noted that the NPA lacked the legal framework to concession the ports and there was no specific guidelines to conduct the exercise. "A lot of importers still prefer to import through other countries. If the concession is favourable, they would not continue to import through other neighbouring countries."
Olusegun Akinloye, one of the committee members told the NPA that if the rules not observed in the concession programme, it would be cancelled.
But Abdulsalam Mohammed, managing director of the NPA, told the committee that one of the greatest hindrances to port concession was the absence of commercial regulator. He said NPA was not structured as a regulator. He also appealed for patience and understanding as the concessionaires were still consolidating their investments at the ports. He identified an unfriendly customs tariff regime as the reason behind the diversion of Nigerian-bound cargo to ports of neighbouring countries. "Importers divert goods to the ports of neighbouring countries and bring them in through the land borders as a way of reducing their costs due to the type of customs regime we operate," Mohammed said. He cited government's banning of certain items as another reason for diversion of goods to neighbouring countries
Chukwuma Nwoko, spokes-man of the Bureau of Public Enterprises, BPE described the Committee's mission as vindictive and to blackmail the bureau. He said it was an attempt to rubbish the BPE.
The BPE, which signed the concession agreement on behalf of the federal government with the concessionaires formally, handed over the ports to successful bidders in 2006 to carry out port operations for concession period of between 10 and 25 years.
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