Mr. Ibrahim Jibril is the National President of the Chartered Institute of Logistics and Transport (CILT) Nigeria. He was a guest on Live Conversations, an Instagram live show hosted by MaritimeTV recently and spoke on, “Supply Chain Management: Domesticating Best Models for Ports Efficiency. He touched on various industry issues; from the port concession, to National Transport Policy, the National Transport Commission, the Railway Project, Integration of all modes of transportation, Apapa Gridlock and many more. Excerpts…
Considering best practices in Supply Chain Management, how would you evaluate the nation’s efforts at domesticating best models at the seaports?
JIBRIL: For any port to be efficient, it must meet the expectation of its users and in that regards, such expectations must be competitive and it is obvious that in recent years, we have entered into some models, which we expected would improve the efficiency of our ports because as components of supply chain, ports must react to the sequence of activities concerning the lifecycle of any cargo on transit. As a nation, we embarked on a model that we believed would improve on the efficiency of our seaports and that model is the concessioning arrangement that we entered into over a decade ago and the essence was to bring private hands into our seaports and take away the cargo handling activities from the then master portal which was the NPA, which was solely the master portal in our ports, thinking that the introduction of private hands will make our ports more efficient.
Now after a decade, we can evaluate what has happened in our seaports. You can say that some of our ports have been quite efficient. Some recent studies shows that like our premier port, the Apapa Port had attained a rating of about 0.9 per cent efficiency, that makes it very efficient. If you compare with ports like Calabar port, it has been rated to achieve an above average efficiency rate but that is not to say that we have what we want in the ports because there are certainly some fundamental constraints. Most our seaports are like river ports; they are within channels and there are restrictions. They cannot attract large vessels like the large container carriers. They will have to berth in the deep seas and maybe engage in transhipments. To get large vessels come into our ports is quite difficult because of the channels and the draft and we cannot accommodate very large container vessels into our ports. That is a constraint that has made us make do with what we have on ground.
In recent times, we have also had other challenging issues like piracy that has affected our port system in Nigeria, even though government is doing something serious on that recently, especially with the Deep Blue Project that is being embarked upon through NIMASA, I think when we come to the end of the facility provision of that Deep Blue Project, we will see the end or near end of piracy that has plagued us in the Gulf of Guinea.
It is very key to mention, having in mind the restrictions and constraints that we have, NPA has introduced a few measures so as to improve the efficiency of our port operations. One of such is Vessel Tracking system that they have introduced which is supposed to give us a port domain awareness of vessels that coming in to berth. That gives room for better planning and with good planning; you can be assured that there will be more efficiency and quick turn around time for vessels because cargo will be handled and discharged very quickly. That is a measure you can see clearly in their command and control centre in Marina there.
To be honest, there are quite a number of measures that they are introducing though it has not come to fruition yet, but when they are implemented, we will be better of to have a more efficient port system. For example, they are working seriously on the Single window platform, which will accord all stakeholders an opportunity to key into the platform so that importers will have only one portal to contend with instead of having multiplicity of agencies. That will improve on the efficiency of the port system, no doubt.
There are other issues that have plagued the efficiency of our ports and I think if NPA goes into solving them through the creation of holding bays that will see to the menace of the grid we have in our access roads. I know the Shippers council are working on the TTPs (Truck Transit Parks) that will help in managing the port access so that the trucks so that they are not all over the place as they are today. It is a good move in the right direction.
The Concession Agreement, which we have in the ports unfortunately, did not take into consideration social repercussions of the concession itself. If it had, it would have included Port Access in that agreement because if we had catered for it at that time, it would have created a certain radius from the Premier port and Tincan Island port will be designated as restricted port area. There would have been control of movement of vehicles and persons in this area and the terminal operators would be fully involved in this via a collaboration with government.
Several years after the concession we keep paying severance benefit to port workers because that wasn’t taken into consideration. The mere fact that there is crisis based on disenchantment by dockworkers brings about stoppages in their work, leading to port inefficiency.
NPA has made several interventions and the Ministry of Transportation has also made efforts but this issue persists. How do we handle this?
JIBRIL: NPA management is still in the process of reviewing the port concession agreement. I don’t think it has been concluded. The only observation I will make is that they haven’t taken onboard other stakeholders who can bring in different ideas on the concession agreement. It was a mistake that the initial agreement didn’t have input of other stakeholders. That inclusiveness would have forestalled some of the challenges we are facing at the ports today. If more stakeholders are included in the review of the concession agreement, that would go a long way to solving the problems.
Several recent reports have identified Nigerian ports, particularly Lagos ports as among the most expensive in the world. What does this portend for the future of Nigerian ports?
JIBRIL: There is this misconception that Nigerian ports are the most expensive in the world, but I don’t agree with such reports. I do agree that the ports are expensive. Studies have shown that even in the West African sub-region, NPA charges are cheaper than those in other countries. The port charges collected by NPA in Nigeria is 57 percent less than what is charged in Ghana for the same cargo. I can give figures to show that NPA charges are cheaper than what is paid in Ghana.
The reports pointed out areas such as trucking, Customs operations following the 100% physical examination and other charges not restricted to those collected by NPA as other service providers at the ports also compound the charges. What’s your take?
It is unfortunate that the road transport mode is one of the most unregulated sectors in Nigeria and trucking comes under this category. There is a need for proper regulation of this sector in the country even as we explore the integration of other modes.
Another problem is the tendency to celebrate the revenue that Customs generate. This trend is very worrisome and as a country we find ourselves giving the Customs revenue targets to generate income. This portends the fact that Nigeria is an import dependent nation rather than a productive one which should reflect in export trade. We content with generating revenue via importation and the Customs are given targets to keep them on their toes. This has to change if Nigeria wants to become a productive nation that encourages export.
Railways have received government attention, yet stakeholders call for integration of the four modes of transportation. Are there indications that the government is stalling the integration of these modes of transportation at the ports?
JIBRIL: I don’t agree that the government is stalling this integration. I say so because I consider where we are coming from. We are experiencing serious decay of infrastructure in almost all modes of transport in the country. I’m aware that the government decided to prioritize the rail mode because it can move the largest number of goods across the nation cheaply and safer. The government doesn’t have the resources to take on reforms across all modes at the same time, so they are phasing it. While I think the government is doing a commendable development in the rail system, I want to see an inclusion of the private sector. There seems to be a monopoly in the system at the moment because we only have the Nigerian Railway Corporation (NRC) and the federal government in it. Private sector participation would lead to a more efficient rail transportation system in Nigeria.
However, achieving intermodal transportation by integrating other modes will be the best thing to happen to Nigeria. The nation must have a plan to achieve this. This plan can be drawn out from our national transport master plan. This master plan should come from the National Transport policy. Unfortunately, we don’t have this policy in the public domain at the moment, even though I’m aware that there is a policy draft. The draft has been on ground for a while, but the government has to come up with that policy. The policy would show the plans of transport development in the country and it gives room for intermodal transportation.
There must be specific plans on how to develop the infrastructure of all modes of transport and how to link them together. We can’t achieve this is one day, but it would be better if we have a plan. You don’t need to construct all the roads and rail lines in Nigeria in one year, but the government can tell us based on its resources the number of kilometres of roads or rail lines that would be constructed in a year. We can break this into short term, medium-term and long-term goals and we can be sure that in the long term we would get to our destination. Intermodal transportation is something we should start planning for, particularly in the area of mass transit.
We already have a bit of satisfactory infrastructure in the aviation industry because it is fully regulated. I think they have made progress but we need to link them to other modes of transportation. The only area of excitement is the linking of railway to the Apapa port but we need to do that to other ports.
Look at the Eastern ports, this corridor that we have completed the rail line from Itakpe to Warri. It is a corridor that shows that we must do something to revive the Warri port in order to use the rail line for affreightment of cargoes. We have been emphasizing passenger freight and there has been improvements from Warri to Itakpe and Abuja to Kaduna for passengers. In addition, we must use the rail ways strategically in order to move cargoes from the seaports to the hinterlands.
Besides intermodal transport, what would you consider the most valuable decision the port industry should take with respect to supply chain management considering the recent emphasis on export trade?
JIBRIL: There is an avenue for Nigeria to take advantage of, particularly the advent of the African Continental Free Trade Area (AfCFTA) agreement. We need to look at our areas of comparative advantage, develop it and champion these areas in the continent. For example, if you look at agriculture, there are some farm produce Nigeria is strong in. We can look into these areas, package them properly and take advantage of the AfCFTA to export to other African nations. In the area of finance, I think Nigeria stands in a very strong position as it could provide finances for the AfCFTA arrangement such that Nigeria takes advantage of that. These are areas we can really work on in order to take advantage of AfCFTA and development our supply chain management in the country.
However, there is a need for digitilization and automation to most of the transport modes especially at the ports. We complain about the level of corruption in the nation, automation can address this by reducing opportunities for human interface. Beyond corruption, automation also makes things efficient and faster if we can achieve that in all the areas of supply chain. This is particularly important for the post COVID-19 era and the new normal. I expect that our logistics system will be more efficient and we can be a major player on the world scene if we are able to automate properly.
Do you consider the loopholes and economic losses as one occasioned by the lack of a National Transport Commission and a guiding policy for the industry?
JIBRIL: I wouldn’t heap all the challenges on the lack of a Transport Commission. However, we should have a guiding policy approved by the government and made public so that everyone could key into that policy. Whoever is going to invest in the transport industry must be able to able with that policy. There are several examples I can cite where people are just working and aligning their policies with that of the government. At the seaport the challenges are apparent. We have terminals who are just there to make money as they don’t care what happens to the nation’s economy.
For example, at the ports, the 0.5% port handling charges that terminal operators ought to pay has been an issue because many of them are reluctant to pay. The government has a reason for imposing those charges and they expect that revenue in order to create an enabling environment for the port operators. The terminals are reluctant because their objectives aren’t in sync with the nation’s objectives. So, that policy has to be in place to start with.
It is also important that we start to build strong institutions that would see to the provision of requisite infrastructure that would see the industry moving towards what the policy says. Consequently, there would be an alignment between what the various operators are doing and the national policy. That national policy on transportation has input from all works of life because done through the National Council of Transport. That Council has in its membership the private sector, local governments, state governments and the federal government with the Minister of Transport as the chairman of that Council. So, if you have such a robust contribution into a policy everybody would key into it.
I’m aware that we have a draft National Transport Commission bill and that bill would have regulated some of the pricing regime in the nation’s transport sector. That would go a long way in reducing some of the challenges we have in that regard. However, that doesn’t imply that our problem is because we don’t have NTC.
Given the functions the National Transport Commission would have had, isn’t it important to have that entity?
JIBRIL: Yes, if there are clear responsibilities the Commission is to handle. There are gaps in the nation’s transport system at the moment and we need such platform to cater for those gaps. A situation where you have a multiplicity of charges in the transport sector is bad and it underscores the need to have a regulator. The road transport mode is one that is seriously suffering from lack of regulation in the pricing and operations. NTC would have ensured a better road transport system in Nigeria. So, it is good to have NTC, but that isn’t to say that all transport challenges can be tied to the absence of NTC.
The Apapa gridlock challenge has outlived several committees, taskforces and initiatives to address it. What’s the key problem?
JIBRIL: We have put in so much to address this but we haven’t seen the results as at today. I mentioned earlier the mistake of not incorporating port access into the concession agreement over a decade ago. We were advocates of that during the initial concession exercise and I don’t know why it wasn’t captured. However, there are so many reasons for the gridlock. Even the siting of our ports particularly Lagos ports was done in cities, industrial and residential areas. We should expect that at some point in time we would outgrow these ports. If you look at the roads leading to our seaports, they are narrow, old and have been inadequate because of the increased volume of port activities. Unfortunately, there is limited space for expansion of these roads.
At Apapa, another challenge is the proliferation of tank farms and this has increased the number of tankers coming into the area to lift products.
Isn’t this an indication that the nation’s pipelines aren’t working?
JIBRIL: I would recommend that we revive our pipelines and do it in a way that tankers can lift products at the outskirt of Lagos using the pipelines. It is unfortunate that we laid pipes and expected that they would just remain like that without protecting them from criminal elements. Everywhere across the world there are efforts to safeguard pipelines and prevent attacks by vandals.
Another problem responsible for the port access gridlock is that we don’t have an efficient truck call-up system. I know that NPA has initiated several plans to use Lilypond truck terminal and the Authority also initiated talks with Lagos state government to address this. I think the Minister of Transportation should liaise with the Ministries responsible for other agencies regulating port access so the numerous issues are addressed. We can’t continue to operate with this port access gridlock. Lots of businesses have been hampered and others have moved out because of this challenge.
The frequent breakdown of trucks indicate that most of these trucks aren’t roadworthy and that shows the extent to which the system is not regulated. These are some of the issues responsible for the gridlock along the Port access roads.
Is there a need to regulate pricing at the ports as some operators say that only terminal operators services are fully regulated?
JIBRIL: There is no doubt that there is a need to regulate pricing across all modes of transportation in Nigeria. It is because of the multiplicity of charges that Nigerian ports are considered to be expensive. This challenge isn’t just at the maritime sector. It is also evident at the road and aviation industry. The regulation shouldn’t just be on the pricing but also on the quality of services. We also need to look at the railway mode because we tend to neglect it all the time. Is the pricing for the rail system okay? Does it reflect the services rendered? Is it just focused on generating revenue for the government? We need to look at these issues. There is a need to regulate the pricing of services not only in the maritime industry but the entirety of the transport sector.
How can government agencies strike a balance between revenue generation and trade facilitation?
JIBRIL: There is a need to have this balance because it is not just about revenue. Everything we do is for the welfare of the citizens and the industry. Whatever the procedures are, as we consider driving export we should endeavour to make them seamless and efficient. Nigerians should be satisfied at the end that they have received good service.
If revenue becomes focal point and we are forgetting that we are serving Nigeria, I wouldn’t agree with this. The government agencies must realize that are serving Nigerians; of what benefit is the revenue when it is at the detriment of the citizens. That is the bottom line. I think trade facilitation and revenue generation must be aligned so that we provide services that are satisfactory to Nigerian citizens.
What advice would you give to stakeholders to ensure that either the National Transport Commission bill is revisited or the implementation Transport port policy is carried out?
JIBRIL: The NTC bill doesn’t address the issues in the maritime industry or port sector alone. The port is just one of the items the NTC should address. I would suggest that stakeholders look at that bill again, particularly to regulate key aspects in the transport sector. If NTC can’t come onboard, we must find a way to control the multiplicity of prices and other regulatory issues across the transport sector.
Some of the challenges at the Nigerian seaports today are attributed to the concession framework. How can we avoid these challenges for the emerging deep seaports?
JIBRIL: I mentioned earlier that since the concession arrangement was a challenge; let’s open the process to all stakeholders. If all stakeholders are allowed to make input, we wouldn’t make the mistakes we made in the past.