Repositioning Nigeria’s maritime sector for growth, competitiveness

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The nation’s economy is facing many challenges with many players in the various public and private sectors struggling to survive. President Bola Tinubu created the Ministry of Marine and Blue Economy to revive maritime contribution to the economy. ADAKU ONYENUCHEYA writes on the strategies deployed by the government to guarantee growth, competitiveness, and future readiness of the nation’s maritime industry to maximise the opportunities inherent in the African Continental Free Trade Area (AfCFTA) Agreement.

The many challenges of the nation’s maritime sector made President Bola Tinubu create the marine and blue economy ministry for the nation to tap into its potential for economic recovery and growth.

Already, other African countries have developed their maritime industry and are attracting Nigerian-bound cargoes and investment to boost their economies.

To reclaim the revenues lost and attract investment into the nation’s economy, the Nigerian Ports Authority, under the leadership of Mohammed Bello-Koko, began the move to address the loopholes in 2021 by deploying strategic artifice of people, technology, infrastructure and equipment to turn the fortune of the sector around.

The economy is also facing challenges such as rising public debt, inflation, foreign exchange instability, reduction in revenue generation, among others, which economists suggested the need to generate more revenue, bring down the high inflation and stabilise the Naira through seamless export facilitation and port development.

Trade facilitation and promotion of export
COGNIZANT of the importance of balance of trade in strengthening the value of the Naira, the NPA certified and licensed 10 Export Processing Terminals (EPTs) in Lagos and Ogun States in the first instance.

The EPTS were conceptualised to eliminate all procedural bottlenecks that hitherto made Nigerian exports uncompetitive in the international marketplace.

The authority in the period under review also successfully enforced the stevedoring regulations, which in addition to deepening professionalism and adherence to global best practice in the maritime sector, created jobs and wrested huge revenue from International Oil Companies (IOCs) that was hitherto lost.

The creation of new businesses and attendant job opportunities such as the barge operations services, which apart from reducing pressure on the roads, has grown into a N2 billion yearly generation business both from direct investment and accompanying externalities.

The NPA has also embarked on the licensing of additional truck parks to increase capacity of parks servicing the Lagos ports.Also, there has been a significant reduction in truck turn-around time due to successful implementation of the electronic call up system.

The NPA has also ensured the enforcement of Minimum Safety Standards on trucks, which stipulates that all trucks accessing the ports are inspected, certified, and issued safety assurance identification.

This has ensured a 65 per cent reduction in the number of accidents recorded, arising from improved standards of trucks operating within the port premises as well as standardisation of operational procedures for different activities such as barging, private jetties, pilotage, vessel berthing/sailing among others.

Enhancing human capital
IN a prompt response to the human resource imperative, the authority in two years, secured the necessary approvals for the increase in salary of its employees, which had stagnated for over 15 years.

The combination of improved operational performance of the ports, tightening of collection mechanisms, plugging of income leakages and debt recovery, resulted in unprecedented revenue generation and remittances to the Consolidated Revenue Fund (CRF) of the federation with revenues steadily growing.

Nigeria’s revenue grew from N317 billion in 2020, N333.5 billion in 2021, to N361 billion in 2022 with remittances progressively soaring from N80 billion in 2020 to N93.4 billion by financial year end 2022, which the authority is poised to surpass in 2023 based on the about N90 billion already contributed into the CRF for January to August 2023, which is rooted in the prompt response to the human capital needs.

In a confirmation of the validity of the authority’s fresh initiatives, the Bureau for Public Service Reforms (BPSR), in its 2023 evaluation of government agencies adjudged the NPA as a level 5 “Platinum Level” Organisation due to the provision of an enabling environment for exceptionally high-quality of work in all essential areas of responsibility, resulting in an overall quality of work that is superior, exceptional, and unique.

To stem capital flight in the face of dwindling foreign exchange earnings, the authority reconstructed the dockyard training school, expanded the bridge simulator at the Port Training Institute and equipped it to international certification standards.

This made it unnecessary to send employees for training overseas and saved the country foreign exchange that would have been expended for foreign training.

Having realised that there is a cost attached to every hour lost to down tooling, this motivated NPA’s sustained engagements with Senior Staff Association of Statutory Corporations and Government Owned Companies (SSASCGOC: TUC), Maritime Workers Union (MWUN:NLC) and other ancillary sector unions, which culminated in the industrial harmony being witnessed.

Diversification of revenue sources
THE NPA leadership is looking beyond sole dependence on revenue from core port operations and have already put modalities in place to create jobs and add value to the national economy from alternative sources of revenue.

This is through public private partnerships, ports independent power production, bunkering stations, fallow lands for logistics/real estate, fresh water provision, ship repairs and maintenance and tourism and hospitality.

Technology advancement
WITH technology being the linchpin of port efficiency, the authority’s sustained updating of ports systems automation as well as the ongoing collaboration with the International Maritime Organisation (IMO) for the development of the Port Community System (PCS) signposts to advance Nigeria’s trade fortunes.

The PCS, which lays the groundwork for the National Single Window (NSW- the global benchmark of port efficiency), is a sector-specific automated system that eases information exchange between all parties that have activities related to the seaports, with NPA being at the forefront of measurable actions steps necessary to operationalise the system.

Although the PCS by its operational dynamics requires multi-agency actions, which have been time consuming, the NPA has through advocacy and collaborations, fast tracked the process and completed the second phase of the consultancy under the technical guidance of the IMO.

To enthrone transparency and eliminate opacity, the Authority has also completed the automation of port-ship reception and billing payment with the Revenue Invoicing and Management System (RIMS), Deployment of Electronic manifest and Ship Entry Notice (ESEN) and deployed electronic Traffic Management System (e-Call Up).

NPA currently operates Oracle Financials and Oracle HR, and is on track for the procurement of software for harbour automation as well as implementing an authority-wide equipping and strengthening of Radio Signal Stations.

The current management of NPA has partnered with the NLNG Ship Management Limited (NSML) for the deployment of Vessel Traffic Service, which is at its conclusive stage.

This is to assure domain awareness capability to enable the authority guide and provide safety information to vessels within its channels and ports approaches in line with the Safety of Lives at Sea (SOLAS) convention.

Upgrading infrastructure and equipment
PORTS sustainability is dependent on the quality of infrastructure and equipment. While awaiting the necessary approvals for the funding of the reconstruction of the aged Tin Can Island Ports Complex and rehabilitation of challenged aspects of all port locations across the country, the current management team has in the period under review undertaken steps to ensure the ports are viable.

These include, acquisition of marine crafts, such as the two units of Azimuth Stern Drive (ASD) 8213 model 80 ton bollard pull tug boats to enable the berthing of very large vessels of 300 metres Length Overall (LOA) and above as well as harbour crafts (tugboats, pilot cutters) to eliminate delays associated with berthing and sailing of vessels to improve efficiency at the ports.

Other measures include, equipping and operationalisation of control towers for Lagos and Tin can Island Port Complexes, procurement and deployment of Security Patrol Boats (SPBs) across all port locations leading to enhanced channel security.

These also address incessant attacks of vessels along the channels and at ports’ waterfronts, which has resulted in unprecedented cargo traffic in the Eastern Ports, especially Onne Port Complex.

The NPA management has also ensured procurement and installation of navigational aids and buoys for Warri and Calabar pilotage districts, for proper channel marking and route mapping.

The authority also ensured completion of the road network for the integration of berth nine, 10, and 11 at Federal Ocean Terminal, Onne Port as well as procurement and installation of marine fenders authority wide.

Other upgrade of infrastructure includes, completion of consultancy services for the shore protection and rehabilitation of the Escravos breakwaters as well as survey and mapping of Warri pilotage district from fairway buoy-Warri-Sapele up to Koko port to the prescribed standards of the UKHO Charts, which had been left unattended for decades

New ports development
IN a bid to position Nigeria to optimise the comparative advantages that the nation’s maritime endowments confer, the Authority provided the technical guidance and fast tracked the approval processes responsible for the commencement of operations of the first Deep Sea Port in Lekki, which doubles as the country’s first fully automated port at take-off.

The Lekki Deep Sea Port laid the groundwork for the recent Federal Executive Council (FEC) approval of Badagry Deep Sea Port, Ondo Deep Sea Port, Snake Island and Koko Port in Delta State.

There are still huge challenges
DESPITE these acclaimed milestones achieved by the NPA management in two years, there are still other challenges crippling the maritime industry and preventing the nation from being a maritime hub in West and Central Africa.

They include, the dilapidated and aged ports infrastructure, lack of automation, congestion at the ports, increased tariff, dollarisation of charges, duplicity of functions by government agencies, bad roads, cumbersome clearing processes among others.These challenges have forced importers and investors to take their businesses to neighbouring countries, just as Nigeria loses cargoes worth billions of naira to diversion to neighbouring ports. It will be of the interest of NPA to urgently look into these identified gaps in order to ensure sustainability of the sector.