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Can NPA begin the review of concession agreements now it has PCAF?

Before now and since her appointment as the substantive Managing Director of the Nigerian Ports Authority (NPA) in 2015, Hadiza Bala-Usman had repeatedly made mention of the need to review the ports concession agreements.

Business Hilights recalls that after few months in office, she made startling observations of faults by former administration in the entire ports and terminal concession deals.

According to her observations, some of the terms and conditions in the prevailing concessions were faulty and not beneficial both to the government and even concessionaires.

Though the Federal Government, according to estimates, earned over $6.54 billion from the concession deals sealed with the private terminal operators across all seaports in Nigeria, NPA under the current leadership smoked out serious faults even though the concession agreements were signed 13 years ago and to last ranges of tenure between 15 to 25 years.

However, industry experts and followers of developments in the maritime industry had expected a clear cut statement from the NPA boss immediately it received the much-expected Ports Concession Assessment Framework (PCAF) Report from the World Bank since last week in her office.

Many maritime stakeholders had expected actions and notifications from the Authority in receiving the World Bank critical document which had paved way for a seamless review of the faulty concessions.

However, there are enough to believe that the able leadership of Bala-Usman will summon the courage to embark on the review of the concessions which observers say will amongst other things, come up with deliveries that will raise the tempo of concessionaires’ investments in the terminals which will translate to improvements in ease of doing business at ports.

In his official response on the readiness of the NPA to kickoff the needed review of the agreements, General Manager, Corporate Affairs, Nigerian Ports Authority (NPA), Jato Adams, averred that the received document is “In furtherance of its efforts to improve transparency and clarity in the evaluation of the concession agreements.”

According to him, “We need to look at the report while the review is ongoing.”

“We have gone far in the process, we are about to round off with the negotiation we have with the concessionaires. There are still some grey areas that we need to agree on.

“We have not been able to reach agreement on those grey areas, and we will equally require the intervention of the World Bank; we are also waiting for them to know what they will come out with. The review is on course. The World Bank acts as advisor on the whole process. We are actually optimistic that this New Year, we should be able to conclude the review,” he said.

Aside the Managing Director’s observations, Chairman, Skelas Group of Companies and former President, Association of Nigerian Licensed Clearing Agents (ANLCA), Olayiwola Shittu, had argued that the initial concession agreements are fraught with some shortcomings and politically motivated.

According to him, “A situation whereby there is no parking space for trucks, no access roads, and no room for expansion at some of the seaports in the country remains an issue regarding the content of the prevailing concession understanding.”

Whereas Bala Usman had constantly assured that her regime will deepen efficiency in the Nigerian ports system with the review of concession agreements to address existing loopholes and prescribe strict sanctions against defaulters, nearly one week silence on the process of reviewing the concessions are becoming worrisome to many stakeholders.