In Line With Executive Order, NPA to Make Ports’ Business Cheaper

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  •  Concessions with terminal operators to be reviewed, tariffs made public

Eromosele Abiodun

In line with the executive order issued by acting President Yemi Osinbajo, the Managing Director of the Nigerian Ports Authority (NPA), Ms. Hadiza Bala Usman has stated that the agency will do what is necessary to make business easier and cheaper across the nation’s seaports.

Usman who stated this thursday during an interview with the Nigerian Television Authority (NTA), added that the NPA under her leadership will review the tariffs charged by terminal operators in order to reduce the cost of doing business at the ports.

The NPA, she revealed, was working on a review of the concession agreements entered with terminal operators about 11 years ago, to align the agreements with global best practices.

According to her, “Our port concessions have been a success story; we need to acknowledge that the Landlord Model that has been in place over the last 11 years has been successful.

“But we are working to review the concession agreements, as we’ve said, there are various sections of the agreements that are not being adhered to.

“There are various areas of obligations that both parties have not adhered to. To the extent that the Nigerian Ports Authority has critical obligations within the concession agreements that we need to abide by.”

She added that the concessionaires also have critical obligations, which in certain instances they have not complied with.

“Both of us are in agreement on the need to review the concession agreements, and we are working to do that in 2017. The revenues being raised by these terminal operators are beyond what the NPA was raising when it was operating the terminals.

“So, indeed, the concessions have been a successful story but there are areas that need to be addressed. We need to sit around the table and dissect critical components of the concessions.

“One of the important things is around regulation. We need to have a clear regulatory framework. We need to ensure payments are monitored efficiently,” Bala Usman clarified.

She said the NPA has established that the terminal operators have increased their charges over the last 10 years, adding that the NPA wants to ensure that the increase in tariffs met the terms of the concession agreements.

“We’ve notified them on this. While there is indeed a temporary economic regulator, the Nigerian Ports Authority feels that within the concession agreement, as we are a signatory to the agreement, that there are areas that the terminal operators are not complying with such as notifying and obtaining approvals of government agencies before increasing any tariff.

“So these issues need to be addressed with a temporary regulator and also with the Nigerian Ports Authority. We’ve notified the terminal operators of the need to review these hikes of the terminal fees that they’ve done over the past few years.

“To the extent that they did not get the necessary approval of government agencies, we would revert to the last terminal fees that got the necessary approvals of the government agencies.

“These are areas that attribute to the seeming cost of doing business in our ports. These are the areas that attribute to the assertion that our ports are more expensive.

“So, having our tariffs becoming transparent, ensuring that the terminal operators also have their tariffs published is the next stage, so that everybody is aware of the tariff regime.”