Imperatives of the Transport Commission Act

Eromosele Abiodun posits that the National Transport Commission will enhance the contribution of the transportation sector to the nation’s GDP if the legislation to establish the commission is assented to by President Muhammadu Buhari

On March 15, 2018, the Nigerian Senate passed the bill for an Act to establish the National Transport Commission (NTC), which will become the much needed regulator for the transport sector.

Indeed, the passage of the bill was greeted with great enthusiasm among industry stakeholders who expressed optimism that a well regulated transport industry will create millions of jobs.

The nation’s transport sector, despite its importance and being the driver of the economy, has remained without a regulator since the country’s independence, making the sector the most abused by operators. For so long, the transport operators have had to set arbitrary cost benchmarks, which are unfriendly to the people. This was possible because of absence of a regulator to checkmate charges and set the rules of engagement.

Experts have also blamed the lack of development in the sector on the absence of a regulator, which they said had made the sector unable to unleash its full potential. However, with the passing of the National Transport Commission Bill, hopes have been raised among the citizenry and top players in the industry, with virtually every stakeholder agreeing on the imperatives of the commission. They have therefore, called on President Muhammadu Buhari to prioritise assenting to the NTC Bill. The National Assembly had prioritised passage of the bill following calls from government agencies, operators and consumers, including such critical stakeholders such as shippers and freight forwarders.

Enhancing Profitability
Harping on the importance of the NTC just before the bill was passed, the Minister of Transportation, Rotimi Amaechi, had stressed that the commission would, “guarantee efficiency, competitiveness and profitability in the transportation sector.”

Since his appointment as Transportation Minister, Amaechi has been making pronouncements on pragmatic ways to revamp the sector. One of these is the development of a national transportation master plan that would help in diversifying and improving the fortunes of the nation’s economy, a role that is typical of every sector regulator.
He disclosed that the government of President Buhari was in the process of developing a national transportation master plan that would be implemented as a fulfilment of one of his campaign promises to diversify the national economy while improving non-oil sector revenues.

“While reducing dependence on oil revenues, it will also develop the rural economy; create jobs at a massive level, both in rural and urban areas. The transportation sector holds the key to any economy; it forms the basis of all socio-economic interactions. Nigeria has been suffering under the bane of inadequate transportation infrastructure. As we have it today, contribution of the transport sector to the Gross National Product is a paltry 1.41 per cent, a development that is unacceptable.

“Although Nigeria is blessed with multiple modes of transportation that is the envy of many, these potential have largely remained untapped. For a sector that plays a major role in the nation’s development, there is an urgent need to exploit the opportunities that abound within the sector to improve its contribution to the national economy and this can only be attained by establishing a regulator for the sector. Countries like South Korea and Singapore have built their economies around a vibrant transportation sector. The Buhari administration is determined to fully exploit the potentials in the transportation sector,” he stated.

On his part, a lawyer and stakeholder in the sector, Emeka Akabuogu said the NTC Bill was one of the most important, if not itself the most important bill targeted at advancing the country’s economy in the last 10 years.
According to him, “We think that one of the things that the NTC will achieve is interconnectivity of all the modes of transportation. There will be a lot more choices for Nigerian passengers and importers to travel and move goods around the country. Nigeria is so blessed to have over 870 kilometres of coastal stretch, yet, its water transport has not been harnessed. The railway infrastructure is now being given attention by the government. More legislative efforts will position the railway for private sector investment and then, we would have the NTC regulating all these operators and ensuring that quality service is rendered for Nigerians to enjoy. We will see that cost of transport goes down and life becomes a lot easier for everyone. I will enjoin our president to give assent to the bill quickly for the Commission to hit the ground running.”

Eradication of Unemployment
One of Nigeria’s major challenges at the moment is unemployment, which the President Buhari administration is tackling. Experts and industry stakeholders agree that the transport sector holds the key to activate creation of millions of jobs, with the government investing little of nothing into the sector. Indeed, with automobile assembly firms now coming up gradually in the country, experts believe that a well regulated transport sector can help diversify the economy by activating multiples of industries and SMEs in the transport sector, as it helps the manufacturing of automobile parts to evolve faster.

“With a well regulated transport sector, the federal government would have scored high on its economic diversification drive, as the sector has the potential to outdo oil in revenue generation from millions of operators and workers in the sector. I am not talking in vain; there are countries to support my position. Such countries as China, India, South Africa and Brazil are models of countries that have benefitted immensely from developing their transport sectors. Interestingly these are same countries in the same breed that Nigeria seeks to join in the years ahead,” said Edeme Kelikume, a transport and logistics expert.

Contrary to fears from some quarters that NTC could be a drain pipe, Kelikume said a transport commission would eventually emerge as a game changer and major, “value-adding agency of the government.”
He further stated, “If the Nigerian Communications Commission (NCC) could become a major net contributor to the gross domestic products (GDP), revolutionising the Global Satellite Communication, (GSM), licences and liberalising telephone services and making communication accessible to all Nigerians, one could see the NTC achieving same for the transportation sector.

“Every logistics chain service provider should be excited about the passage of the bill and already looking forward to the unlocking of the sector by the coming regulator, which will further deregulate the sector and draw fresh funds into government’s coffers. That time may just be months away, as we expect President Buhari to sign the NTC Bill soon.”

“With the industry’s vast potential as an economic catalyst, regulation will unleash the sector’s potential and position it for greater exploitation that is capable of creating millions of jobs and turning the country economy around for the better. Therefore, the bill when signed into law, will give the nation’s transportation sector a new face lift, coordination and needed impetus to drive the economy,” said Chibuzo Ekwekwuo, a transport expert and analyst.

Catalyst for Growth
Also, the President of Shippers Association of Lagos, Rev Jonatahan Nicol and Secretary of Bonded Terminal Operators Association of Nigeria, Omolajomo Haruna lauded the passage of the bill by the National Assembly and said the presence of a regulator in the transport sector would be a catalyst for the sector to grow and become a huge employer of labour, calling on President Buhari to quickly consider assenting to the bill.

According to Nicol, “The bill will immensely regulate excesses of stakeholders in the shipping subsector, especially at attaining equitable port and transport charges. “We hope implementation will enhance the ease of doing business in Nigeria as a whole. It is therefore, important for the Executive to give priority in signing the bill into law.”

For General Manager, Duncan Bonded Terminal Tin Can Port, Haruna Omolajomo the NTC will see to the success of the several dry ports being championed by the Nigeria’s Shippers’ Council (NSC) across the country, by ensuring that seaport terminals do not become a holding bay for containers and other cargoes.

He said: “As containers continue to dwell in seaports for more time than normal, congestion of the seaports and traffic gridlocks in Apapa have become inevitable and we have all seen the menace of it. The other side of it is that only five out of about 20 bonded terminals are now functional and working at only three per cent capacity utilisation. It is a pity that most of them owe banks and had sacked 95 per cent of their staff, instead of employing.
“If the NTC bill is signed into law, it will invoke the multi-modal system of transportation in Nigeria. A lot will be happening to see that the transport sector investors do well and generate employment. Transport and shipping cost will also go down, as we begin to see a tangible regulator activate competitive markets in the shipping subsector.”
An official of the NSC who does not want his name in print told THISDAY that the transmutation of Shippers Council to NTC will be seamless.

“Expect fast and easy implementation of the NTC Bill once signed into law, as there is already an existing agency of government to quickly transmute into the NTC. Stakeholders and proponents of the bill are in agreement that the NSC can quickly be made to become the transport commission. Already, the functions of the council have been absorbed in the commission and strengthened to give the commission regulatory powers.

“Some of these functions, which the NSC is already executing include monitoring and enforcement of standards of service delivery to ensure availability, accessibility, affordability, stability, predictability and adequacy of services to n the transport sector; encourage competition and guard against the abuse of monopoly and dominant market positions; promote efficiency in the provision of port services; minimise high cost of doing business and prevent its inflationary effect on the Nigerian economy; and encourage private sector investment in the port sector, ”she said.

Need for Assent
Also speaking, a shipper, Stephen Agboola said: “To me, what is left now is for the bill to be signed into law, so that the commission comes to life with full powers, whose decisions are not challenged with court actions arbitrarily. It is so sad that as important as it is, only the transport sector has remained without a regulator since the birth of this country. It is unbelievable. Nigerians spend the biggest single chunk of their income on transportation; yet, no agency of government is there to ensure that they get a reasonable service.

“According to the World Bank, transportation represents 15 per cent of cost of every good people buy, and as significant as that is, transport operators are not regulated. Thank God we are getting to the end of this anomaly, but we can’t continue to wait as usual. So, this is at no cost to government to begin to set up another cost-oriented concern. Once the president signs the NTC Bill, the Shippers Council will naturally transmute to the Transport Commission.”

Omolajomo said: “I believe that with the NSC’s current capacity and having seen what the council has been doing in the sector, the council is very capable of transmuting into the transport commission. The council I know has many units specifically designed and with very well trained personnel to handle every area of functions that I have seen in the NTC Bill.

“In fact, it is interesting to observe that the NSC has gone beyond protecting transport consumers interest to building transport infrastructures through private sector initiatives all over the country. One can only imagine how many Nigerians will be employed directly and indirectly by these initiatives.

He continued: “For example, Buhari himself unveiled for business on January 4, 2018, one of the landmark Inland Container Depots (ICDs) driven by PPP, which are planned to become catalysts for economic development at a massive level in the various places where they are located. The NSC is also driving construction of Truck Transit Parks (TTPs) through PPP as well. These are transport infrastructure that can employ thousands, if not millions of Nigerian directly and indirectly.”