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	nigeria, time for new expectations LATEST REPORT June 12th, 2000


NIGERIA A new business climate

nigeria PORTS AUTHORITY

"Gateway to the Nation's Economy"

Manager:
Mr. Wali S. Ahmed, Engineer

Read our exclusive interview

Contact:
CORPORATE HEADQUARTERS

Plot 126, Olusegun Obasanjo Way
Central Business District
Abuja

Facsimile +234 9 2347930/1
Telephone +234 9 2347455Email
Email: telnpa@infoweb.doc

LAGOS LIAISON OFFICE
26/28 Marina
Lagos

Facsimile
+234 1 2636719
+234 1 2630306
Telephone +234 1 2600620 - 12

Telex 21500 ONPNPA 23763 ONPNPA

LONDON OFFICE
2nd Floor, Allenby House
1A Temple Road
(off Cricklewood Broadway)
Cricklewood
London NW2 6PI

Facsimile +44 181 452 8062
Telephone +44 181 450 3101 - 3
Cable Gen.Ports, London
Telex 25506 NPALRG
26651 NPALRG

... Cruising progressively into the 21st Century

Since, 1st April, 1955 when it commenced operation, nigerian Ports Authority has made remarkable progress and presently accounts for about 99.27 per cent by volume and 95 per cent by value of the total import and exports of the country.

nigerian Ports Authority operates under the supervision of the Federal Ministry of Transport with the responsibility of providing specific ports and harbour services for the country's maritime industry.Today nigerian Ports Authority controls 8 major ports excluding oil terminals with a cargo handling capacity of 35 million tonnes per annum.

Consequent upon the vantage location of the country within the West and Central African sub-region, nigeria offers transit shipment services to her West Coast neighbours and therefore serves as the gateway to her land-locked neigbours.

As we march progressively on into the 21st Century, our aspirations are to continue to grow, lead and sustain the economy of the West and Central African sub-region.

With modern plants, crafts and equipment to enhance speedy and efficient services, adequate security to ensure safety of customers goods and computerized operational systems, nigerian Ports Authority is fully prepared for the challenges of the next millennium.

Strategy

nigeriaN PORTS AUTHORITY IN BRIEF

The development of a sea port in nigeria started in the mid 19th-century in the era of explorers and traders. Although limited initially to the opening up of the Lagos Lagoon, it however resulted in the opening of ports at Apapa and Port Harcourt. This led eventually to the establishment of the nigeria Ports Authority (NPA) in 1954 to maintain the ports as well as load and discharge cargo. The NPA commenced operation on 1st of April 1992,. It made remarkable progress and on the 15th of June, 1992, the nigeria Port Plc. was incorporated. However, in consideration of its full government ownership while recognising its commercial status, the company in October 1996, reverted to its former name - nigerian Ports Authority.

The nigeria Ports Authority (NPA) today is a wholly Government owned organisation under the supervision of the Federal Ministry of Transport with the responsibility of providing specific ports and harbour services for the country’s maritime industry.

The Statutory duties and major functions of the company are:

Provision and operation of cargo handling and quays facilities.

Pilotage and towage services

Supply of water and fuel to vessels at anchorage or mooring buoys

Repairs and maintenance of vessels

Dredging and contract dredging of waterways

Navigational lighting of the ports

Other ancillary services.

In pursuance of government’s efforts to ensure the efficiency of public enterprises, the operations of nigeria Ports Authority (NPA) became fully commercialised in May, 1992.

Today, there are eight (8) major ports under the management of the nigeria Ports Authority :

Apapa Port - Lagos, Lagos State Roro Port - Lagos, Lagos State
Tin Can Island Port - Lagos , Lagos State Container Terminal - Lagos, Lagos State
Port Harcourt Port - Port Harcourt, Edo State
Delta Ports - Warri, Delta State
Calabar Ports - Calabar, Cross River State
Federal Lighter Terminal, Onne, Delta State

NPA MANAGEMENT SET TO MEET CHALLENGES OF NEXT MILLENNIUM

The Management of the nigeria Ports Authority (NPA) has stated its preparedness to provide a favourable environment for the installation of Total Quality Management (TQM) in the Authority, in order to cope with the challenges of the next millennium. This was disclosed by the Managing Director of NPA, Engineer Wali Ahmed, during a recent awareness workshop on Total Quality management organised by "International Centre for Management Research and Training" (CIMRAT) for Principal Managers drawn from all the Ports.

The NPA, according to the Managing Director, who was represented by Assistant Manager, Training, Mr. Eke Ijioma, occupies a special place both within the nation’s maritime sub-sector and the global economy. This position, he said, has resulted to pressures from her numerous customers.

Engineer Wali emphasised the relevance of the management concept in reshaping the fortune of the Authority and the enhancement of her corporate performance in all areas of operations. He therefore charged the participants to emerge with resolutions which would enable Management take further actions on the subject matter.

In his brief remarks, the chairman of CIMRAT, Professor Augustine Ahiauzu a one time Vice Chancellor of the Rivers State University of Science and Technology, Port Harcourt , commended the Management of NPA for the noble and timely acceptance of the concept of TQM which , he said, would make the Authority a model of what an efficiently managed organisation should be and an example for other nigerian public enterprises to emulate.

AN APPRAISAL OF THE nigeriaN SHIPPING POLICY AND DECREE NO.10

DEFINITION OF nigeriaN SHIPPING POLICY

The nigerian Shipping Policy can be defined as the totality of a set of government principles, plans of actions, statements of ideals and strategies proposed or adopted for the promotion and protection of our national interest in the field of shipping. Decree 10 of 1987 titled "National Shipping Policy Decree" is part of the nigerian Government’s strategic enactment in pursuance of her shipping interests.

Before Decree 10 1987, the main laws affecting shipping were the Constitution which gave the Federal Government responsibility for all matters concerning overseas trade and shipping; the laws of the Federation 1958 which among others adopted the British Carriage of Goods by Sea Act 1924; the Ports Acts 1958, the Shipping Navigation Act 1958. After independence the Marina Insurance Act 1961 and the Merchant Shipping Act 1962 were adopted from British laws, while the Ports Act 1958 and Merchant Shipping Act 1962 were amended. Other Acts that were enacted before Decree 10 of 1987 include the Admiralty Jurisdiction Act 1963. In the decade immediately after the nigeria Civil War, maritime related legislation covered port operations, River Basin Development Authorities and the nigerian Shippers’ Council Decree of 1978. Other legislation before Decree 10 include:

Carriage of Goods by Sea Act 1958
Ports Act 1958
Shipping and Navigation Act 1958 (repealed by MSA 1962)
Ports Amendment Act 1961 (repealed by No.30 of 1971)
Admiralty Jurisdiction Act 1963
Oil in Navigable Waters Act 1968
Flags of nigeria Ships Act 1968
Lagos Port Operations (Special Provisions) Act 1971
Merchant Shipping (Amendment) (No. 2) Act 1978
Amendment No. 9 Act 1978
Pre-shipment Inspection of Imports Act 1978

Development of seaports in nigeria commenced by the Portuguese from about 1870. In early times the riverine territories that make up the present day nigeria had customs and practices that could be termed policies. For instance, there was the collection of dues for vessel passage. These dues provided revenue for paramount rulers and guaranteed protection for those who paid.

The nigerian Marina Department was established around 1906. The budgetary outlay for the department in that year was GBP92,195. The department ,among other things, carried out transport services, dredging operations and also published shipping intelligence reports which listed names of the vessels that called at the ports and their flags of registry.

The Government Coastal Agency was set up in 1954 for the purpose of solving the problems of clearing and forwarding of imports and exports that confronted the Federal and Regional Governments under the 1952 Constitution. They also dealt with the problems associated with booking of passages for British Colonial officers.

In 1957, the nigeria National Shipping Line (NNSL) was established by the Federal Government initially in partnership with two British Lines (Elder Dempster and Palm Lines) before the two were bought over one year after nigerian Independence. The establishment of NNSL could rightly be identified as the first attempt by the Federal Government of nigeria to participate in the commercial rewards of lifting nigerian cargo.

The NNSL was indeed the unsung foundation for the establishment of the 1987 Decree 10 which came 20 years later. It was through the throes and difficulties of the defunct National Line that the country experienced corporally the limitation of a developing country’s shipping in open competition with known maritime nations. This led nigeria to join other developing nations at the Palais de Nations to negotiate what popularly became known as the UNCTAD Code of Conduct for Liner Conferences and other shipping agreements.

This also led to the growth of Shipper’s Council movement all over the developing world spearheaded by Sri Lanka. nigeria, as already stated, established her Shippers Council in 1978.

THE nigeriaN SHIPPERS’ COUNCIL

Unlike the NNSL which was basically a government company established to make money for the government through direct participation in the carriage of sea borne trade, the Shippers’ Council was established by law as a government run collectivisation for nigerian shippers to save foreign exchange through its freight negotiations with the various shipping conferences plying the nigeria route. These shipping conferences are made up of various shipping lines that ply a particular route and who agree to run the same scheduled time-table, same freight from point to point and who gave certain concessions in freight to faithful shippers. These conferences may even agree to pull earnings together becoming close conferences like the old UKWAL Conference or agree on some loose competitive co-existence as in the case of the Europe American Conference where membership was open.

The most important aspect of the Liner Conference operations is that together the lines wield formidable oligopolistic power which gives them , in principle, the power to dictate the freight for the route thus putting the individual shippers at their mercy. To counter this collective powers of the conference, the shippers had to form some kind of union or collective group to counter the powers of the conference lines. In developed countries where importers and exporters are bigger individually and more knowledgeable, these shippers collectively known as the Shippers’ Council are not government run organisations. But in developing countries where the opposite is the case, it requires the powers of the governments to establish such councils as is the case in nigeria.

Over the past 20 years, the nigeria Shippers’ Council has been performing this task in union with the other West African sub-regional shippers’ councils to achieve an equitable freight rate for shippers (that is importers and exporters)

DECREE 10 1987

Before the enactment of 1978 Shippers Council Act and to some extent the establishment of nigerian National Shipping Line in 1957, one can safely say that the nigerian Shipping Policies were basically in colonial interest or reactionary to existing problems. None of them were planned or aimed at economic development or projection of promotion of national interest. Decree 10 came to put an end to this trend.

Decree 10 is the most dynamic of all Federal Government enactment on shipping in terms of socio-economic of objectives. Its objectives were as follows:

The correction of any imbalance in the nigerian Shipping trade for the purpose of the implementation of provisions of the UNCTAD code of conduct for liner conferences especially the ratio 40:40:20 in carriage goods to nigerian Ports.

Improve balance of payment by enhancing earning and conservation of foreign exchange from shipping industry.

Use National Shipping Policy to promote export trade and accelerate growth of national economy.

Ensure greater participation of indigenous shipping lines in liner conferences in order to influence decision making processes of such conferences in serving nigerian international sea-borne trade.

Assist the economic integration of the West African sub-region

Protect nigerian vessels flying the nation’s flag on highs seas and world sea ports

Increase participation of indigenous shipping lines in ocean shipping lines through application of provisions of UNCTAD code of General cargo and by entering bilateral agreements or other suitable arrangements.

Encourage increase of ship ownership and indigenous skills in maritime transport technology

Achieve systematic control of the mechanics of sea transportation and

Promote training of nigerians in maritime transport technology and as seafarers

The bottom line is the Decree 10 is meant to ensure a positive balance of payments for the nigerian Economy, particularly the contribution from the Nation’s shipping. To achieve these objectives, the Decree put forward two major strategies:

1. Cargo Control & Sharing
2. Encouraging the ownership of vessels.

Cargo Control and Sharing

The need for this interventionist approach of controlling nigerian cargo-project, bulk and general cargo was necessitated because of the nation’s weakness in competing with the more developed countries in getting cargo. The Decree made it legally mandatory to share all general cargo in line with the 40-40-20 formula but also went ahead to insist that all Government cargo be given to nigerian lines while 50% of all bulk is left to foreign lines.

Encouraging the Ownership of Vessels

Conscious of the fact that to carry cargo in and out of nigeria there was a need for vessels, the articulators of Decree 10. sought to promote the acquisition of commensurate bottoms in the nigerian fleet. A Ship Acquisition and Ship Building Fund was set up to put into the hands of its administrators the power to influence the appropriateness of the vessel for the nigerian trade; to ensure that all vessels were sea-worthy, of adequate size, age and proper type and class without encumbrance. Unfortunately after about two years (1994-1996) , the government stepped in to suspend the shippers acquisition and ship building fund programme.

CONSTRAINTS TO THE IMPLEMENTATION OF DECREE 10.

1. Lack of International Co-operation.

The International community , especially the developed market economy saw nigeria’s gain through Decree 10 as their own losses. They felt that cargo sharing ought to be done within a free competition atmosphere, not through a state interventionist approach.

2. Poor co-operation from strategic arms of the government.

Wrong attitudes on the part of some government departments that were strategically placed led to the lack of effective co-operation in implementing certain aspects of the Decree.

3. Sabotage by some private and public sector organisations.

These groups feign total ignorance of the Authority’s function because of their private interests or attempt to circumvent them by other contracted means, creating unnecessary problems for the nigerian Maritime Authority.

4. Bloated feasibility reports.

Particularly with respect to the Ship Acquisition and Ship Building Fund, bloated feasibility

reports were presented by the various beneficiaries which tend to dilute the objectivity of the Fund Managers in their analysis of proposals.

5. Funding constraints faced by the authority.

6. Political Interference.

This arose mostly due to the fact that Management of the Fund was not made independent of the government.

7. Reluctance to apply the disciplinary measures on erring foreign and indigenous shipping lines

EFFECT OF CERTAIN ECONOMIC POLICIES ON SHIPPING

Certain government economic policies have direct impacts on shipping. For example, banning import of certain goods and requirement for import duty reports have been part of constraints facing the NMA. This led to nigerian goods being taken to neighbouring ports thereby denying indigenous carriers the carriage rights and making it impossible for the government and its agencies to derive necessary revenue.

ESTABLISHMENT OF NIGERDOCK

Nigerdock nigeria Limited was established for vessel maintenance. This proved that the Authority was coming to terms with the need to project and promote the peculiar interests of nigeria in shipping.

ESTABLISHMENT OF nigeria UNITY LINE AND NATIONAL INLAND WATERWAYS AUTHORITY

These two entities were established with good intentions. Unfortunately, the ideas behind their creation were not accurately implemented and they both died early deaths.

PORT REFORMS

Port reforms have been pursued for some time now. There has been the introduction of pre-shipment inspection, professional import duty administrators, various security agencies in the ports, etc. All these measures were aimed at reducing turn-around times of vessels and response to the strong competition nigeria ports are facing from neighbouring countries.

RECOMMENDATIONS

Cargo Sharing should be sustained and reinforced.

Ship Acquisition and Ship Building Fund should be resuscitated, but this time around, amore elaborate mechanism should accompany this move. This should include the participation of NMA and other relevant bodies.

Any economic policy that has direct impact on shipping should as a mandatory procedure require involvement of consultation with all relevant shipping agencies.

Government should pursue vigorously, the review of the National Shipping Policy in order to clear away all weak areas and strengthen unclear provisions such as provision of coastal shipping services. Carbotage laws should be enacted for the mandatory indigenous participation in this aspect of the shipping industry that serves the oil industry which is the dominant earner of foreign exchange for the nigerian economy.

CONCLUSION

Decree 10. Was indeed the first bold step taken by nigeria to promote and project its shipping industry. After ten years of its implementation, a critical appraisal of its values proves that, despite the resistance form various quarters and the many ups and downs, it was definitely a positive move.

INTERVIEW WITH
ENGINEER WALI AHMED,
MD nigeria PORTS AUTHORITY

March 22nd, 1999.

FORBES: NPA is one of the most important parastatals, and probably one of the most efficient ones now in nigeria, most especially in terms of cost-efficiency. Could you please begin by just giving us a little, brief historical background on NPA, and how it’s evolved during the last few years, especially like what you were talking about before in terms of technology?

W. AHMED: Thank you very much. I am very pleased to say that we are one of the most efficient organisations in nigeria. It is true. You can see the Headquarters. This H/Q started just three years ago, and we are number one; we complete(d) our H/Q. at a very reasonable amount; what led us to be very efficient is sincerity and honesty. Whatever one does in life, one must be first resolute, firm, and have a focus. Focus, in short and long (terms), mid-term focus. I was able lead by example. For example if you look at all our projects I have no single (one) that is abandoned in the organization. When we came here (in) 1996, we had no single accommodation. At the moment we have 240 houses that we built within (22 ) years. When we came here we (were) renting Headquarters, but you can see our H/Q is one the unique … you can get anywhere in nigeria, even in the world, because you cannot see two ships moving together, … you can see the quality of building you (may imagine its) Italian. I believe you’re Italian, you know, look at the finishing, … but it’s all nigeria, our contractor is nigerian, the consultants are nigerian. Everything is nigerian. And …

FORBES: … and the Italian tiles?

W. AHMED: Yes, Italian tiles, because we imported part of this from Italy. You see, what makes us, … if you go back to history, this organisation, eight years ago (could) not even pay salaries. We were always in problems, and instability with union strikes. But since I became MD in the last 6 years, there’s (been) no single strike in the organisations. Because they realize the personality (that) I am, they know I don’t (pursue) this kind of personal interest. I put my interest first in the organisations, then second(-ly in) the welfare of the workers. My own interest is really last, always. They appreciate that and have cooperated very well. That’s why we have stability in the (organisations.) you (realise that) I (have, stayed here, the longest (-serving) MD in West Africa. All West African Port MDs (have been) retired, removed (or) sent away without ceremony and I have been here for six years. Normally, we serve only 4-years-one-term, then renewed for a second term final year. I’ve already done my first term, and then the government approved again a second term. I (‘ve) served two Heads of state, which is not very normal here. I’ve served 5 Ministers (of Transport) during this period. The casualty rate of Ministers is very, very high. So, I am the longest-serving MD (of) the nigerian Ports Authority; others (spent) one year or two years; because I am very, very serious about my work, they (NPA workers) have done very well in every sector you pick: welfare, training (first class), infrastructure building, we are virtually the best because there’s no parastatal in nigeria today that has entered fully into their H/Q apart from us.

FORBES: You were the first or only?

W. AHMED: We were the first, NNPC only (occupied) one portion of theirs, they have not completed the other portion. In about 2 years’ time they will go in, and other organisations, all, we were the only one (to have made) sure we complete(d) everything in time. And I am very happy with my staff because they (have) cooperated with me. That’s why we are pushing forward. Four years ago, everything like I told you earlier, in the area of billing (was) manual. We have not computerized. But my target is to make sure (that) by (the) end of May, at least 5 Ports: Apapa, Tin can Island, Pina, Roro, and Port Harcourt, would be fully computerized (and) not only linked to us, but all their billing, final bill, their provisional bill, extra service, everything will be computerized. With the shipping companies, initially they were very retentive (sic), because they enjoyed the weakness of our softness (sic) before, but now because they realize we are serious, they are now cooperating. So, they are going to link themselves, up with the ports.

FORBES: So, you were saying earlier on that before, without computerization it would take up to 7 months for a ship to receive its bill, how do you …?

W. AHMED: Yes, exactly for a final bill you must get imput from the harbors, the Audit Department, Finance Department, er …

FORBES: How is computerization going to improve on the time-scale, how long do you think it’s going to take now?

W. AHMED: Now, we are targeting two days, one to two days. That’s what we are targeting. Because all the information now, … within our system, before an auditor sends his own imput, or harbors send their documents for preparing the final bill, it will take … generally the file will take 2,3 or 4 months, and you know many ships (come), [there are some missing or incomplete documents], so it takes a long time. At least 6 to 7 months.

FORBES: So, now, you’re trying to reduce this time …

W. AHMED: What I am saying is that a ship can go and come back, still our debts are (not settled), can make 4 journeys during the period, another one year not finalized, second year not finalized, you know, so it’s a complication. But now I’m telling you in the nest two years, we are getting it (done) in two days, (this) final bill. Which means, the time-lag for one ship (rather than) 7 months is now (reduced) from one year to two days!

FORBES: Unless of course there’s going to be a chance to improve on your (system further) …

W. AHMED: Oh, yeah! And you know as well, our accounting system will be settled properly, and then the businessman there, the main ship owner, this is what he is looking for: you send in your ship, you come, you settle your account, you know, immediately, you (conclude) all about this, another journey, you settle, so there is serious improvement on both sides. For the ship owner, (there’s a reduction in expenses).

FORBES: Just may be on to something slightly different. In the past there’s been some security problems in the ports, ranging from vandalism to theft. What measures are being installed to eradicate the problems?

W. AHMED: You know, security … it was hell before. But I can tell you, when we were in Lagos about 4 years ago, I used to get a lot of letters, form owners of cargo, … (but) in the past three years maybe I have not got one letter. Before maybe on a daily basis, one, two, three, four a day. Some (were) threatening to (take us) to court, some (were reporting) to me that (their goods) had been vandalized. But at the moment, in one year I get nothing, not one!

FORBES: So what have you done to stop …?

W. AHMED: There’s improvement because,… what we did, we have put these our surveillants; if you go to the ports, we have put in Containers’ (shed), in Roro, Tin can Island, in most of the Ports, whereby the Port Manager can see what is happening (through) the different cameras, placed in (different points) for continuous monitoring (of) the very key areas: the parks, the gates; of course the ... is the main key-post where the security officer, the police are there constantly monitoring what is going on, and really we try our best also to minimize entry into the ports. Because if you go to … I sent some of my workers, like some of them travel in Europe, sponsored by NPA, to Liverpool, Hamburg (Germany), where they saw how containers are charged, in Antwerp in Belgium, they saw what was happening, in Netherlands (too). Me, I know what is happening but, you know, if you stay here in nigeria without going round to see what is happening you will not know. They can even start to make you cry, cry everywhere, so I (could) sponsor them (on those trips). And when they (returned) I sent them to West African Ports like (in) Cote d’ Ivoire, Ghana, Senegal, Benin, in order for them to see what is also happening in Africa. Because those French-speaking countries are what they call London port we (in the) English-speaking countries are what they call operating ports. That means, we are the ones doing most of the job.

FORBES: How much of the market do you get in West Africa?

W. AHMED: Naturally, (possibly), we are the richest in West Africa number one. The population, you see, the market (is dictated) by population. Their facilities (are) poorer than our own; the Benin Republic delegation came, the Niger, the Tchad, they went round, because they (were) looking for "chargee montante", they found that we are richer, we spent a lot of money in improving our cargo and equipment. Every year since 1992, we have been spending millions of dollars including last year. And this year, I have just started by the transfer (of) market trailers. There is no comparison. Out of cargo coming to West Africa, 64% automatically comes to nigeria.

FORBES: Is that higher than South Africa?

W. AHMED: Well, when I say West Africa, I mean, I am talking about West Africa, really, you know. Sixty percent of the cargo comes to nigeria, the rest is divided among the other ports.

FORBES: So, with all this market that you are gaining and all the improvement you’ve over the last few years, what is your turn over now?

W. AHMED: Well you see, it varies. When we project, this is what we expect, sometimes it depends on government policy. If there is a monetary (or fiscal) policy from government, it can affect the encouragement of … But I can assure you with a new government coming in, if above all foreign investors are not even in nigeria in the last few years, but now with the coming in of the new administration, we are opening up Human Rights, all the companies coming in as you could see, became the market is open …

FORBES: You are not going to give me a figure?

W. AHMED: Of the amount?

FORBES: Yes.

W. AHMED: I cannot summarize. (I didn’t) know you were going to ask me about that, but I know it is in the region of billion naira, not billion in dollar. You know, but definitely is in that range.

FORBES: This is maybe a figure you could answer once we give you the transcriptions, I think it would be interesting to have it.

W. AHMED: I can tell you the total capacity of our ports, the design capacity in nigeria. We can handle, the berth, about 28 to 30 million metric tones of cargo. That is the designed capacity. If every berth is occupied with ship of the right tonnage, we can handle that.

FORBES: At any one time?

W. AHMED: At anytime! You know there is a berthing factor … Normally like we projected this year, about 18 to 19 million metric tonnes. But in terms of money, honestly I cannot tell you (off the cuff) I don’t want to make a mistake.

FORBES: That leads now to another question. What are the practical problems, … dredging or … cash-flow, etc, which are impeding the NPA from reaching its goals faster?

W. AHMED: These problems are internal, they are not for external (discussion), and they are very minor. When you talk about dredging, virtually all our channels, the four channels, we have LNG, we have done it, they have done (it) on our behalf, Mobil, but we are paying them there, to open (up) the channel, because what the LNG project (left) uncompleted 2 years ago, is now being done: maintenance dredging to maintain the coastal area. Calabar Channel, because of EPZ (Export Processing Zone) dredging (has been) completed, is okay, open any bigger ship can come through Calabar Port. I am pleased to inform you (that) maybe you are the only one to know, we have not (published) it anyway you know. We have just … the Head of State has just approved the opening of the Escarvos (Delta), that’s a very critical channel to Warri Port. This is the channel that is going to be used for import-export for Ajaokuta and Aladja Steel industries. Ajaokuta is the biggest steel industry in the world, and Aladja is another big steel industry (contract for) a rail-line was awarded between Ajaokuta (and) Warri, but unfortunately our channel was too shallow, only 5 metres. So it will only take maybe 5,000 (or) 10,000 (tonnes) ship. But right now, any moment, (the) capital dredging will take off, ten metres, to meet 3,000 plus 4,000 tonnes of ship carrying billets and others can come in and go out. So the government is clearly taking care of complicated areas. No organisations will say that it has no problems, but minor problems are internal, I don’t think I need to tell you our internal problems. But the major one the shipping compan(ies) would like to know, is that all our channels are open, capital dredging is going to take place anything (for), for the last 20years … has been rendered hopeless because you cannot you cannot easily bring heavy ship in talk about 100 miles on the high sea. Then use smaller craft, is a lot risk; but now the ship can (arrive) there if, after completion she can traverse to the port.

FORBES: There’s been a lot controversy (over) the government’s privatization programme concerning the NPA. A lot of people say (that) the responsibilities of NPA should be delegated to private companies that the NPA should a subsidized authority. What is the exact situation?

W. AHMED: Let me tell you, with NPA, no controversy. There are people who think there’s controversy … the (committee) came, they studied everything. Our neighbors NITEL, NAFCON, this and that they mentioned. It is very easy to say. That is what is now in the mind of the government. Our own requires, first, stability of the country, that is the implication. You see, you cannot hand a channel over to a private company. You don’t know (things) can get out of control. What happened with the Private Jetty people (mentioned in connection with) the 1990 military coup (d’etat) in nigeria? So, for NPA, right now, some of our functions are indirectly privatized. For example the charging of cargo for the ship is our responsibility, but we appoint a private company called the Stevedoring Co. to do the charging of goods. Also for even cargo Relay equipment is being handled and managed by a private companies on our behalf. It’s our own equipment, but we take (them) to them, they manage (them) on their own there’s a German and an Israeli …

FORBES: Which ones?

W. AHMED: The German man.

FORBES: What are the names of the companies?

W. AHMED: Hector. Is the one in charge of Roro Port, the one that manage(s) all our equipment. We mandate(d) them to buy the spares and replace them. V-Boot Container, there is a company called Marine Mature. Marine Mature is the one that is managing our cargo and equipment there. For floating crane … we handed it so a German company called Floor. Floor is the one that is managing (it). But I can tell you, the problem, … experience in privatization … about 20 or 18 years ago, we had thought of handing over manage. The arrangement was that 80% of the profit would go to MPA, 20% to the private company. They were not telling us the truth, they were hiding the profits. The had even balance sheets of their own. Most of their Directors went … So, when they were here, we used to get maybe x 4 million, 5 million a year. The union (was) involved, everybody was working, fighting (saying) They are cheating, they are cheating. So we took over the ports (in) May 1991. Before May 1991, … we found out that what they were declaring (at) first, (was) like (showing us) a monthly collection as yearly collection. We took over May 2^nd1991.

FORBES: So you made a lot of difference?

W. AHMED: Too much, too much. So, but when we took over, we found that from May 5 to end of May we (had) made about x 56 million that time, and when we looked at the annual account, it was x 50 or 55 million, all that they had (give as) their annual collection, but here in May 1991, we collected x 56 million. Our workers, salary was about x 1 million. That discourage us. A similar case happened (at the) Container Port. A private company was given Container Port to manage. When we took over we found that the two ports were financing all our projects. Our salaries, global, (were) paid from the cover loans. But, you see, now I can tell you, privatization is a tide, is a vogue. Every thing must be privatized in the future. That’s why I told you, I asked my union to go round to see what is happening in the world. That’s why I asked him to go to Pakistan to see how a/port is being privatized. That why next month, (April) we will be travelling to Hong Kong to see a private port (there) and in Singapore. Hong Kong is private, Singapore is government. So, I want to go and see. I am preparing the mind(s) of everybody to know that there is no alternative to privatization there must be privatization later. But we are also planning to, for example … what we do more at the moment is, we encourage individual invest(ment) …

FORBES: So, in fact, you are not opposed to privatization, you are just, some of those responsibilities, you are handing (them) over to private companies?

W. AHMED: No. no, no. You see, the government has made it a policy that every nigeria who (has) money outside should bring it (in) to nigeria, (to) help the economy. Many are not doing so. But there are a few, through our encouragement … we encourage them, they bring their money, and they invest in the port; by investing, we get relief.

FORBES: Have you had any American investors coming into nigeria?

W.AHMED: To invest in the ports? … At the moment only nigerians, first …

FORBES: But you were talking about a German company which handles the cargo …

W. AHMED: No that’s not German … no, equipment. Equipment.

FORBES: But they are private, you are dealing with them …

W. AHMED: But, you see, that is fully their own private company. They are not …, we have no share in that company. [Just like you giving out a job to clean this office] Yes, to manage it for us. We support the company from there. The only where we have a sort of participation from another company from Switzerland, is in the area of dockyard; we form(ed) a subsidiary, with a 40% share-hold(ing) by Gozwan, by the European, you know, the Swiss, and 60% by NPA. There are the areas (of) ship repairs. If you go to Lagos you will see them in repairs you will know that … all our craft, when they get spoilt we take them, they repair, you know. Organisations, it (were) doing everything by themselves. But now we have formed a company with a Managing Director, a European, and with our nigerian(s) joined together, to form that company called continental Shiyard. They are handling all our crafts (sic). This is a step forward, you know.? Before, we were the ones handling everything, but now …

FORBES: Now you are delegating.

W. AHMED: Year, that is gone, you know. We have shares there. Also, there’s a property company which we formed. A limited liability company. Even though partially, or (indeed) I can say 100% owned by NPA, it had freedom to operate like a private company on property. Property we left when we all came from Lagos are managed refurbished and rented out (for us by company). The house I was staying (in) (at No.) 19 Oba Oyekan, American Embassy took it, refurbished, they took it (on) rent (for) 3 years. So, we are mixing indirectly, of course if you talk with the union, they will tell you they don’t want to hear about privatization. But I tell you (the) truth, there is no alternative … well of course, there are many countries in the world that are private, many that are private. Like Hong Kong, many others. Majority. But eventually, I believe, in future, definitely. Like in dredging now for example, it is a private company, before it (was) our own NPA workers doing the dredging, but now our dredges we (have) handled over to a private company, to manage the dredging for us; we pay (a) certain amount … they are Europeans … but our people are there, on the dredger. They do the job in community with our people, but we pay them (a) certain amount of dollars; we found it’s cheaper by about 70% than to give it (out to) a contractor, to do the job for us. [So, you need to know the list of equipment …]

W. AHMED: Naturally, all over the world, they do give lease, you see when I say London port, london Ports, something like in Core d’ Ivoire, only few … can take, even Asterdam, Rotterdam, where the port is demarcate and hand(ed) over to an individual: the one that will appoint the fuel company, provide the security, provide (Madicare), provide the equipment, dowment the cargo (and) deliver the cargo to the rightful owner. That is what we call London port. For operating ports like ours, we are the one that document, the actual discharging, we contract a private operator to (do), but documentation and handing (over) of the cargo to the rightful owner (are) done by our own workers at NPA. But the moment we go into privatization, that’s why the unions are the moment that is taken (off) their hands, they will become redundant, because the company will employ (its) own security, (its) own workers, (it) will document everything, the shipping company will have a choice where to go, when the ship is coming, traditionally it knows where its going, you know to go to the …

FORBES: There’s only one place … place replace.

W.AHMED: Yes, So, that we are gradually moving. I believe we are breaking up all these things like the dockyard that we had before; now, P-View Property we had before, now cut off (off) NPA, with their own Managing Director, everything, they man their own, they pay their salary, but not from our own resources. For dredging now we are using the private company, leasing with our own people, through the maintenance of dredging, with appointing of foreign companies to discharge cargo (rather than) NPA workers continuing to do it, or the giving or renting of, taking all our cargo (even government) not NPA here to handle it, we hand it over to a private company, to maintain for us … [maintenance of this building in terms of fumigation and the rest of them]

W. AHMED: Yeah, like fumigation, cleaning sweeping is not done, so we are really cutting away some of very actual doings from them. Private companies are coming in to do some of our functions. But there are some areas where the money is … (those are the ones) the nigeria have been fighting for. Their argument is if the area is lucrative, and the government is getting something from it, why do you give (it to) somebody (else) to do? If the area is maybe different to manage, or if private companies can use it properly and get a turn-around, them (it) is good to give (it) out (to) the company.

FORBES: Also making it all the more efficient.

W. AHMED: Yes. Privatization, we are within Vision 2010, where maybe in the next, after this, we finish with all these ones, the next batch. But there are areas that require clear consid(eration) and care because of security implications, (it would be a mistake for those) not to be controlled by government).

FORBES: Well, as a final question, considering that we reach 42 million readers in the (United) States, have you got a final message for them concerning the NPA, the industry and nigeria as a whole?

W. AHMED: Yeah, about all we are improving our facilities, we’re (operating) our new cargo relay equipment, we keeping our channels open and clear, we are reorienting our own workers to be disciplined, to be honest, to cooperate with shipping companies. We are, above all, computerized, in order to be more efficient, in order to more efficient so that the ships that when a ship is go8ing to stay in our ports it maybe 2 days and they finish (and) go. You go, you are given the final bill, that is our target. We are also connecting all the ports to our corporate Headquarters in Abuja, we already awarded a contract for the wiring of the port here, and the contract for the main brain for this network is about to be awarded, so we hope by the end of this year…

FORBES: To who? (is the contract being awarded)

W. AHMED: As a Ministry, you know we have levels of authority. I have my level as MD, I can approve (a) certain amount, above me there is Management here, if it is above that level we have to recommend it to the Ministry, the Minister will take it to (National) Executive Council under the Chairman(ship) of the Head of State, who will give approval. So, at the level of Port Managers, they have their own level of approval and limit. If it passes them they will pass, if it is within my level, I approve it, I do it without confronting anyone. If it is above me, I will call Management meeting, then a memorandum will be presented. If it is above us, then we write memos to the Minister of Transport, (who will also) write his own memorandum, attached to our memo; take it to the Council of Ministers, or to the Head of State, for approval. If approval is given, then the Central Bank (releases the fund). There (are) always checks and balances in our operations. We don’t approve anything without being careful (especially where money is involved). The government, in the budget removed or cut back on some tariffs, as incentives to importers. When we realise that the past few years, the country has had some political problems, then (that could discourage potential importers/investors).

FORBES: So, once those are removed, then investors can come?

W. AHMED: I can tell you without being told (sic), clearly with democracy coming into nigeria, you know, the sky is the limit (for) nigeria. I’m telling you. Ships will come, and people will berth, few nigerians will stay away, as refuges, (they) will come back with their money in to do some business. So, all this will begin to count in projecting our total tonnage mean this year. And then, we estimate the total amount, from which we pay our salary and allowance, pay our pensioners, we contribute dividend to government, to the Federal Account. We never take any kobo from government, but we give them money every year last year we gave about $9 million. This year, I don’t know if we are giving them anything, because there is a lot of costs coming in, because the salary is highly improved, and we are doing … So, that’s why I agree with you when you say (that) we are doing well. So far, so good! (General Laughter)

FORBES: Well, thank you very much.

Read on

© World INvestment NEws, 1999.
This is the electronic edition of the special country report on nigeria published in FORBES Magazine,
October 18 th issue.
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