Economy

Interview: Intels owes Nigeria over $140m – Usman

The Managing Director of the Nigerian Ports Authority (NPA), Ms Hadiza Bala Usman, in this no-holds-barred interview with Deputy Editor Olayinka Oyegbile and Ibrahim Apekhade Yusuf, speaks on her quest to turnaround the fortunes of the NPA vis-à-vis her battle with people with vested interests and the different challenges she confronts daily on the job. Imbued with the strength of character and common touch like her famous historian father and social critic the late Prof. Yusuf Bala Usman, the graduate of Ahmadu Bello University (ABU), Zaria, and University of Leeds, UK, speaks on her mission. Excerpts:

SINCE you came on board, you have literally shaken some tables and taken some earth-shaking decisions. For instance, the Intels deal generated a lot of controversies and you pulled that through. Would you want to shed more light on some of these decisions?

Well as it relates to Intels, they were providing us with services of collecting of revenue from port operations. They were not remitting as and when due. When I came on board, we signed a supplementary agreement which required all revenues generated to be paid into the single treasury account (TSA) where all revenues generated should go. Following that agreement, Intels has been very difficult in making payments to us. They have not paid us. They owe us over $140million that they have not remitted to the TSA. So we felt that such non-compliance will not be accepted, such impunity should not be accepted and hence, we issued a notice of termination to them. We are going to advertise for a replacement company that would offer such services at a cheaper cost because Intels is charging the Nigerian government 28% for revenue collection and typically such commissions are limited to 10-15%. You hardly see where an agency is collecting 28%. So we have initiated a process of termination and we are also going to court to ensure that those monies not credited by Intels are paid back into the government coffers.

Also, we removed a monopoly that hitherto existed where oil and gas cargo only terminate in certain ports in the Eastern Port in the region. That also stifles the industry and not allow for you to thrive as a business concern. Even if the distance between your oil platforms is closer to certain terminal, you cannot go; you have to go to Onne Port and journey because you mustn’t pick up without using those terminals. We got that approval and that is ongoing because you can see from the Egina that berthed here. If we hadn’t removed the monopoly, the Egina would not have been able to berth here. And right now, Shell Petroleum Development Company is also commencing servicing of their operations from Lagos area. And they had even detailed the submission to us which articulated the amount of revenue savings. We got that letter last year from them, indicating savings of millions of dollars, all because of the removal of the monopoly. That’s an important milestone. So introducing the TSA is one of the revenue saving measures that we have embarked upon.

The NPA prides itself as the gateway to the nation’s economy. You have talked about the new revenue streams you have created since you came on board. Could you give us an overview of what the NPA can generate if it’s fully operational?

(Laughs) Well, it’s difficult for us to say that because it is tied to cargoes coming to the ports. So even if Nigeria has the most improved ports, it has to be that that item is allowed for consumption in Nigeria. So one of the things that we have is the automobile tariff we put in place. So we have terminals like the RORO terminal made for vehicle. So now because of the 70 per cent cost of duty, it has dropped completely. So our revenues are really subject to what comes in or goes out of the country. For example, rice has been banned for importation. That’s a huge item that used to come in through our ports. So quite a lot of items have been classified as banned or some there are high import tariffs on them. So that automatically reduces the volumes of cargo that are coming. So it’s difficult for us to equate that because it’s inflow and outflow. We also seek to improve on our export by providing the necessary enabling environment to fast track and prioritise exportation. Some of these items are for example, solid minerals; we have noted request for exportation of kiln, it’s a volume issue so the more volume the export, the better because the cost is very cheap. So if they now pay much for port dues to export, it’s not worth their while. But that is also an item for our solid minerals exportation out of Nigeria. So in certain instances like that we look to see how we can encourage the exporter. If there is a certain mineral you want to export, once the volumes are high, we are looking at providing them a tariff regime that encourages them to do it. The more volumes you bring, the cheaper we will give you for harbour due. So these are some of the things we do to sort of address the need to have more export as Nigeria seeks to become more self-sufficient.

We’re looking to see how we can maximise our revenue while ensuring that the operational activities of the ports remain steady. We note the need to recognise what is required as it relates to both the Eastern and Western ports. The Nigerian Ports Authority (NPA) operates two regions of the port. At one side is the Eastern, which has Port Harcourt, Calabar, Onne and Delta ports respectively while the Western port comprises Apapa and Tin-Can Island ports. So we look to see how we can restructure the ports in terms of development and also ensuring improvements on equipment and also ensuring that we have ease of doing business within our operations.

There has always been that belief and impression that more attention is focused on the Lagos or Western Port. Why? And what are you doing to make sure that the Eastern Port is also productive?

As you aware, the cargo or shipping business is a destination of choice and concessionaires decide where to take their cargoes to; as such, you can’t tell somebody you must go to Onne, or you must go to Calabar for example. So people decide where they want to take their cargo. And some of the reasons that inform the destination of cargo involves where the final consumption of that cargo is. For example, in the Western Port, you have the manufacturing around the Lagos corridors, Ogun State manufacturing, so that consumes quite a lot of items that are being imported. To a certain extent, you also have large markets within the Lagos environs; they also are consumers of these products. You have Dangote Industries, you have Flour Mills and you have all manner of activities within Lagos and Ogun States so that in itself is the consumption within that area. On the other hand, you also have people that are taking or bringing in cargoes up to the hinterlands, so there is also a need to have defined route or cargo movement. If you want to take your things to Kano how easy is it for me to move from Calabar to Kano? Is the road navigable for articulated trucks? Is there a clear path to where I can get? Because in the Western Port for example, if you’re going to Kano from Lagos, you know your road already once you come you’re going and you know articulated trucks go through that route. These are some of the reasons that inform the choice on where you will take your cargo to. So people tend to come to the Lagos environs for the immediate evacuation of their cargo because that is where they want to take their cargo.

We have noted the concerns within the Eastern Port. Some of the issues we have are on draft limitation. As you are aware, our Calabar Port has a draft limitation. Hitherto, I inherited a Joint Venture for the Calabar Channel Management Dredge and that was a big issue that we had to cancel. It’s an ongoing investigation about an unverifiable dredging works. So we have started another process. But it translated into huge volumes to the extent that we are looking at spending about N45-50billion on dredging of Calabar Port. When you look at the volumes of cargo that can come to that region, it’s very high so there is no justification in terms of revenues coming into the port to justify that volume of investment.  But indeed, even if you dredge, you will only dredge to 10 metres. And right now, the global trend for shipping is deep seaports. So spending that amount of money will not attract the current trend of vessels being made. So those vessels that are being made now require deep seaports, about 17 metres draft and you cannot dredge 6-17 metres. So what we are doing now is we are encouraging bringing in flat bottom vessels to Calabar and we are encouraging having deep seaports in that area so that it would address the issue in totality. It’s like you want to do something but that thing you want to do has been overtaken by events. Even if we spend N50billion, we will only dredge it up to 10metres and now vessels of 10metres are not the vessels that are in trend. The vessels that require 17metre are the trend so it’s of no value for the Nigerian government to invest in that. So we are working on having flat bottom vessels as well as encouraging deep seaports. Delta is also one of our Eastern Ports, and it has a limited draft because of the Nigerian National Petroleum Corporation (NNPC) Pipelines that have been buried in that location. So in the last year, at the end of 2018, we got approval to dredge the Escravos Bay, which permitted a depth of about 7.5metres that would enable vessels to that side. So we can go deeper than that because of the NNPC pipelines that are buried there. We are discussing with the NNPC and I remember saying to the GMD that let us start the process of relocating the pipelines. It may not happen in a year or two years or five years but we must understand that that location requires deeper depth and start the process of relocating the pipelines. So this is the Delta Port. The Port Harcourt Port is in a bad state. We have commissioned a condition survey. They have submitted a report which will determine the totality of investment into that Port Harcourt Port because it has reached its limits in terms of utilisation. So the conditional survey had provided what is required. So we need to literally build new kits, new infrastructure, in that place. And when we look at what is expected of the vessels type that would come globally now, do you want to invest in this kind of port now when you can invest in deep seaports to enable you now reach where you want to go. Onne Port is in a good state. We have the attendant draft required and it’s a port that usually has a lot of oil and gas cargo and transactions so every other activity there is available, they have a private container terminal that is operating there. So this is the summary of what the Eastern Port entails right now.

And one of the other things that I forgot to mention about the Eastern Port is charge on insurance cost. The vessels that are coming to the Eastern Port for example, have to have war insurance for coming into the place because there are lots of piracy and even besides insurance, they have to pay money for private security. So if you are coming to the Eastern Port, you probably need to engage private security to guide your vessels. So it’s very discouraging   for the shipping companies because of the high rate of piracy. That is one issue that is responsible for the unviability of the Eastern Port as it relates to the shipping industry.

As part of boosting the security infrastructure, recently four tug boats were commissioned. Do you have a working relationship with the Nigerian Maritime Administration and Safety Agency (NIMASA) with regards to the issue of security at the ports and the waterways?

Well, we do have that. We are working with the Nigerian Navy, NIMASA and we have the Marine Police to facilitate securing the waterways. So we work with the Marine Police. One of the areas that is directly ours is the terminals. So when you come into our waterways we need to ensure that your vessel is safe. So we support our Marine Police by providing the necessary equipment to man the waterways to facilitate a secured discharge of the port.

The issue of ease of doing business at the port is paramount and that explains why the Vice President came up with the Executive Orders. How has the port fared in all of this?

One of the things that have to do with ease of doing business inside the port is that we need to have scanners that scan our cargo. So every cargo that comes in goes through 100 percent physical inspection so you can imagine that delay. The next challenge with the ease of doing business is the fact that all agencies of government interface with the consignee, the SON, etc., we need to deploy single windows in our ports. We need to call upon the Nigerian Customs and be engaging with them to fast track that.

Everybody thinks that if you bring your cargo into the country and it doesn’t get to your warehouse it is NPA’s fault. No. NPA’s work is to allow the vessel to come in and berths with your cargo unloaded from the vessel through the terminals and when that is done, it’s no more our duty. At that point if Customs doesn’t come to inspect your cargo for three weeks, I always say it, it’s not the NPA’s fault.  If Customs need to physically examine your cargo, it’s not NPA. If you need to see the National Agency for Food and Drug Administration and Control (NAFDAC), Standards Organisation of Nigeria (SON), Quarantine or whatever, it’s not NPA. The Nigerian Customs is the lead agency for inspection. So they must do the single window. But nobody cares to know this. All you hear is NPA this, NPA that. (Laughs) So there is that misconception. But for me, at the end of the day, we are the government. We need to step up our efforts to ensure that we provide services for the citizens. Again, it’s very frustrating when other people’s job affects yours. So your rating is tied to other people not doing his job. That is very frustrating. So when I see the Nigerian Customs declaring, oh, we made N12billion, I say no, you need to improve on your infrastructure, let people judge you on the fact that every container has to be moved. So how do you honestly say that we have physically examined all cargoes coming into Nigeria?  We really need to assess ourselves in terms of the services we provide and what we are providing beyond the numbers. If it takes someone three days to clear his cargo in another place but it takes you three weeks or four weeks to finish all those interfaces and that’s not our responsibility. Then when you come out of the port now, you need to have another transportation of cargo. So over the years, we abandoned the utilisation of inland waterways, e have even not explored inland waterways. We have abandoned rail everything is on the road. So we must fast track our deployment of rail. Thankfully, the Nigerian Railway Corporation is working on that. We have marginal service at our single gauge into the port. They even have wagons and what have you. It’s not every terminal or port they get through. So when you also look at the Apapa corridor, you have the tank farmers and they are also another issue. They should actually be moving their cargo through pipelines not through roads. So that just compounds all of that traffic. But as they are going to deploy the rail, we have also been granting permission for badge operations so that people can move in and out using badges. We have locations in Epe, Ikorodu, and I think somewhere around Badagry they want to have locations where they would use badges. So they want to do a survey using our inland waters for movement of cargoes. So when we talk about the actual congestion at the ports, we need to understand that the state and local government must recognize that truck/motor parking is in fact their responsibility. So for instance, the Lagos State government needs to provide truck parks. We have made that proposal severally. Orile Park they say is available but they have concessioned it and the concessionaire has not finished. All we keep hearing is stories back and forth. You can’t have a situation where all trailers are free to move anywhere causing traffic congestion and using the roads as a transit channel for trailer parks. We even advertised three times seeking for people to come and license trailer parks. What we want to do is to license trailer parks and only trucks coming from those trailer parks will access the ports. As it relates to port location, we recently terminated Lily Pond, which is a terminal that we had hitherto but because of the persistence traffic congestion, we have canceled the lease and we are using it as a transit location for trailer parks.

Another idea tied to the Executive Orders is the idea of having the port run 24 hours. How far is the NPA close or far from that goal?

The Executive Orders is for us to do 24 hours operation in Apapa Port. So the NPA has started that. But the challenge is that other agencies of government don’t run 24 hours. The Apapa Port that was designated in the Executive Orders for 24 hours port operations; we provide that service to the extent that after a while my staff said, okay, why are we going if other people are not going?  We also probably need a weekend service. I also advocated having customs clearing on weekends. Banks would come and open weekends so that they can clear on weekends and that reduces the congestion and everything.

What do you hope to be remembered for after your exit from the NPA?

I want to be remembered for instituting transparency and accountability and operational efficiency. Transparency and accountability is very important to me. And when I see some of the agreements we have entered into as a government, I really wonder how we allowed our country to sign on those agreements. So I have had cause to terminate a number of them. I’m reviewing a lot of them. For me, I think people need to be held accountable and then we need to have more transparency. Demystifying government is very important so people can see. We have seen a lot of instances where organisations tend to hold on to things. So I think it’s safer to let it out. Once everybody knows, it reduces the problem of what do I do next, whose responsibility is what? I believe in having a clear and transparent way of working. You see most staff in government agencies tend to see government as a third party so they can do whatever they want. So these are some of the things I want to be remembered by.

As a daughter of the famous historian and social critic, the late Prof. Yusuf Bala Usman, what are the fond memories of growing up with your dad?

On my father! I would say I was brought up in a university and was always part of the intellectual discussion. My father encouraged us to speak our minds and pushed us to engage him on things that we felt we didn’t understand. So that formed the premise in which I was able to question the status quo. You know, I’m not held back by inhibitions or have this idea that the government can’t be questioned. Or if someone is your boss, he can’t be questioned. I was brought up to question things. As a young child, I was ever inquisitive, why are you doing things like this, what’s the reason? What informed your choice and judgments? So I don’t get intimidated by authority or people in authority. I speak my mind and I say whatever I think. So that gives me that freedom. My father always encouraged us to think like that and I also refused to be put in a box to think in a particular way. I chose to be who I am and I chose to question the status quo and challenge authority. So even when I’m working with my colleagues and other agencies of government, and they ask me why have you not done this or done that, and when I speak to the press I’m told not to say that. I tell them no. Let people know it’s your job and you haven’t done it. Let everybody know. So once we are pointing fingers at ourselves we will start sitting up. And I think that freedom, boldness, and confidence to speak comes from how you are brought up. My father brought me up like that.

-TheNation

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