The appointment of Nigerian Shippers’ Council (NSC) as interim port economic regulator in February 2014 did not come as a surprise to many. The Council had lobbied for the position since 2006; shortly after cargo handling operations were transferred from government to private companies.
To say that the decision of the Federal Government to embark on reform of the seaports, which culminated in the port concession of 2006 is the best thing that has happened to the Nigerian port system since political independence in 1960, is to state the obvious.
Prior to the reform programme, Nigerian seaports were highly inefficient and unattractive to port users. The ports could not even compete with those of neighbouring West Africa countries. The result was huge congestion at the ports and attendant diversion of cargo to the ports of Duala, Cotonou, Lome, Tema and others in the sub-region.
Nigerian ports were characterised by unnecessarily long turnaround time of vessels and long cargo dwell time prompting the imposition of what was then known as port congestion surcharge on consignments coming into the country by multinational shipping firms under the aegis of the Europe-West Africa Trade Agreement (EWATA). There were also frequent cases of insecurity of cargoes giving rise to broaching and in extreme cases ‘flying’ of containers, which is the local parlance used to describe container theft from the ports.
The gains of the port reform are numerous but with the exercise came the challenge of regulation. The absence of an arbiter to mediate in times of dispute between the landlord of the port, Nigerian Ports Authority (NPA); service providers made up of shipping companies, shipping agents, terminal operators and others; and the consumers of port services made up of importers, exporters and their agents; had been a sour point in the system.
Government’s plan to create the National Transport Commission (NTC) through an Act of the National Assembly has failed in the past sixteen years. The NTC was designed to be to the ports what the Nigerian Communication Commission (NCC) is to the telecommunication sector.
While the appointment of Nigerian Shippers’ Council has been hailed by some – mostly clearing and forwarding agents – others have expressed reservations about the ability of the Council to be fair to all.
NSC was established during the military regime of General Olusegun Obasanjo by Decree 13 of 1978. It was set up originally to fight the cause and protect the interest of Nigerian importers and exporters. As a result of this mandate, many see it as an interested party in the cargo delivery and logistics chain. Since the Federal Government has decided, in its wisdom, to confer the role of commercial regulator on it, the NSC’s major task must be that of confidence building. Without statutory backing yet, the Council requires the cooperation and goodwill of all concerned in the chain to successfully execute its brief.
While the management of the Council has so far exhibited fairness in its handling of commercial disputes at the port, it is important that the newly appointed Executive Secretary, Mr. Akutah Pius Ukeyima, who is not known to have had any prior contact with the industry, does not see his role as that of “protecting shippers” only. He has the responsibility of protecting the larger public interest, and this includes protecting port investors, monitoring compliance with contractual obligations to the government and users, and other legal and regulatory requirements.
The NSC under Ukeyima should not hesitate to impose penalties for non-compliance by government agencies and service providers alike, administer tariff adjustments and periodic reviews and facilitate dispute resolution between parties. He should also see it as his responsibility to provide advice and counsel to government on policy matters and other matters related to promoting private sector involvement in the sector.
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