Ports Economic Regulator and Automation Project

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Francis Ugwoke

For every maritime stakeholder, the mention of world big ports like Shanghai, China and Singapore rings a bell about their level of perfection in cargo delivery operations. To many it is still a surprise as to how they are able to cope with the container volumes or vessels being handled on daily basis. Shanghai is the largest container port worldwide based on 2019 throughput. The port handled 4.3million teus in 2019, according to latest statistics published by Statista Research Department.

It is followed by the Port of Singapore which attracts 140,000 vessels annually with 537.6 million tonnes. The maritime industry contributes 7percent of Singapore’s GDP and 170,000 jobs, according to statistics. The country also projects that by 2025, the sector is expected to create additional 13,000 jobs. This remains an eye opener to many as to what a modern port is all about.

In these ports, for a first time visitor particularly those from the developing countries, one is marveled at the serene atmosphere in the port environment. Nigerian officials who had visited on account of learning how to fashion our own ports to advanced ports give account that these ports are not typical of an environment where millions of containers are handled. It is away from what happens in Nigerian ports.

There is no human heads loitering around the gates and terminals as the case in Nigerian ports. And that is a typical example of what technology can offer in modern port operation. In the ports of Shanghai and Singapore, automation is the key word covering decision making (yard management), gates, tracking and tracing, yard cranes, quay cranes, freight forwarding and indeed trucking system. Everything works perfect with no congestion and breakdown on the port environment. It is all trade facilitation at best.

This is indeed what the Nigerian Shippers Council (NSC) as the ports economic regulator wants to be enthroned in Nigerian ports system, a high level of efficiency in trade facilitation. The Council has been preaching for effective automation covering all services in the ports in such a way that a freight forwarder representing his shipper can stay in his office and get a cargo released without having to physically be at the ports.

Automation in Nigerian ports
Nigeria has no doubt introduced automation in most of her port services. Every agency has embraced automation. This ranges from Nigerian Ports Authority (NPA), Nigeria Customs Service, Nigerian Maritime Administration and Safety Agency (NIMASA), Nigerian Shippers Council (NSC), among others. But a lot still needs to be done to reach global standard in shipping services by way of complete integration.

This is what the NSC is working on to achieve by March 2021, according to the Executive Secretary, Mr. Hassan Bello. To some extent, Bello agrees that there is definitely some level of improvement on automation, but would wish that the standard as obtains in advanced ports comes to play in our own maritime environment.

At a recent webinar, Bello called for integration of all stakeholders in the sector, including the Customs Service, NPA, NSC, importers, terminal operators, freight forwarders to achieve a 24 hour ports service. With 24 hour service, automation of ports services, deployment of multi modal means of evacuation of goods, ease of doing business at the ports will definitely be enhanced.

How corruption affects automation
In Nigerian ports environment, areas where automation has become very effective is in payments of NPA charges, customs duties, terminal handling and shipping companies charges. But having done this, the customs agent will still have leg-walk to do by visiting physically the service providers to confirm that payments have been received. The agent must also visit the Customs where he is likely to receive queries on his payments.
He has to interface physically with the officer who would probably demand settlement if the shipper wishes to get lower debit note (DN) or suffer higher surcharges. During examination of cargoes at the ports, the shipper or his agent must be around to settle the officers or this process would be delayed. To industry operators, Nigeria needs to move towards smart ports with high level of automation where cranes deliver containers from ships to the port through unmanned yard cranes.

These containers are then stacked according to type of cargo and inventory. Automation should also go further to impact on other processes, including bill of lading, all other invoicing and what happens at the gates where a lot of security checks are required. Automating entry and exit gates will go a long way in eliminating rounds of manual checks as is the case in Nigerian ports where most times settlement is what determines how fast the truck or vehicle is allowed to go.

To the President of National Association of Government Approved Freight Forwarders (NAGAFF), Chief Increase Uche, automation has become very necessary in all facets of ports operation with the current ravaging of coronavirus pandemic.

He said, “We need to depart from this manual processing of any stage of port operation. This should involve everyone, the banks, the freight forwarders, customs facilitation, shipping companies, cargo delivery from the terminal. There should be comprehensive integration of all the players. All port operations need digital transformation and the ravaging COVID-19 pandemic experience should be a major reason why the single window implementation must be put into motion to promote automation”.

Uche recalled that in 2006 when the ports were concessioned, automation worked for some months with the introduction of ASYCUDA 2.7 by the Customs Service before being scuttled by some unscrupulous customs officials who felt that they were not making personal money as a result of automation.

“As at that time, with scanner once your cargo is on green lane what you require is to go to the terminal and carry your goods to leave. By that nothing is causing you any encumbrance. But at a stage, when the Customs Processing Centre (CPC) discovered that nobody was coming there anymore, and those at the terminals found out nobody recognised their presence any more, they started posting alerts. “That was what reversed the whole thing. The CPC that was almost deserted became lively again towards 2008 and early 2009. That is how the whole thing was reversed again. So that was how automation under ASYCUDA 2.7 was reversed again”, he said.

Similarly, another freight forwarder and maritime expert, Dr. Eugene Nweke said if Nigerian wants what obtains in other advanced ports, there should be serious commitment on the part of the government to achieve it. Nweke said an automated port system is expected to, “posses the capacity for unhindered communication via Single Portal which provides for single lodgment process, validation of data, inbuilt security device, prompt business intelligence monitoring and responses, accommodate users templates, minimise efforts for all parties via seamless net-workings.”

He said what Nigerian shippers or port users want is an automated port system with wholesome paperless documentation regime in, “port-shipping operations in which submission of documents and processing are done almost instantaneous, reducing man hours and associated delays.”
Nweke was also of the view that what obtains in Nigeria currently was far from the needed national centrally driven automation process, referring to the multiplicity of automation efforts as represented by different agencies of the government.

He argued, “National automation process is devoid of undue agencies supremacy tussles, it is driven purely on national interests. This is why the World Trade Organization (WTO) is calling signatory member nations to migrate into the National Single Window concept.”

To him, the Nigeria Customs Service has a near national automated system but limited to trade, a robust interface and interaction capacity as required.

“Same goes with the NPA, NIMASA,etc. All of them seem to be driven by core agency objectives which is a negation of whole essence of National e-commerce networking amongst the port/shipping companies. Ordinarily, one should expect that this evolution of national port automation process should be a core focus of the Nigeria Shippers Council,” he said.

He explained that this was because the Ministry of Trade seems to be far from the global realities.
He added, “From all indications, it appears that the trade ministry has surrendered its administrative obligations to the Transport Ministry, perhaps for policy concerns.”

He called on the federal government to as a matter of priority harmonise its policy objectives beyond the individual ministry and agency interests for a common goal.

Arguing that the Presidential Task For on Ease of Doing Business didn’t achieve much in its campaign on account of non-seamless integrated process, Nweke said it is imperative to allow the NSC as the ports economic regulator to sustain its advocacy in this direction.

“I must also note that, going by what obtains in any country where National Single Window permeates, by WTO/WCO recommendations, the Customs serves and stands as a lead agency to drive the process. Unfortunately, since emphasis is on seamless trading and trade facilitation and not revenue generation, I doubt if it will be appropriate for the Nigeria Customs to lead, hence, the need to score administrative balance or reconcile the inter play between trade facilitation flexibility and revenue generation rigidity”.

For the NSC as the ports economic regulator, what is currently on the agenda is automation of the ports system because of its impact on checking corruption. Bello believes that digitalisation will enthrone enduring efficiency and competitiveness in the ports industry.

The current situation as far as digitalisation is concerned, he said, stands at 65 per cent. At a meeting with terminal operators recently, he expressed concerns that certain transactions, such as bill of lading and invoicing are not carried out online. He disclosed that consultations are on with shipping companies, terminal operators and the banks to harmonise the process for effective online integration in these areas.

Bello said, “Most terminal and shipping companies are online, like 85 per cent and we need to make things more efficient. That is why we want to digitise so that one can exit cargo without going to the port.
“Digitisation is also against corruption. If one does not physically interact, you pay electronically and reduce corruption, it will be cheaper, more efficient and we will be more competitive.”