CONCESSION AS A STRATEGIC TOOL FOR PORTS EFFICIENCY: AN ASSESSMENT OF THE NIGERIAN PORTS
- Project Research
- 1-5 Chapters
- Qualitative
- Content
- Abstract : Available
- Table of Content: Available
- Reference Style: APA
- Recommended for : Student Researchers
- NGN 5000
Background Of The Study
In today’s global commerce, seaports or maritime transport play an important role of being many nations’ major gateway for international trade and are a good instrument for measuring the economic health of a nation (Ogunsiji & Ogunsiji, 2010, UNCTAD, 2008). The ports have considerable influence on the volume and conditions of trade as well as the capacity for economic development of nations still developing. In Nigeria, greater percentage of international trade is routed through the sea, and given its huge population, it is believed that the Nigerian economy may account for about 70% of all seaborne trade in the West African sub-region (Fivestar Logistics, 2008). Hence, the country’s ports are increasingly challenged to meet the pressure mounted from movement of ships and cargo in and out of the ports. The Nigerian Ports Authority established as an autonomous public corporation with the enactment of the Ports Act of 1954, assumed responsibility as a regulator and an operator entirely owned by the federal government (Mohammed, 2008). The Technical Committee for Privatization and Commercialization (TCPC) was established in 1988 as a result of the need among others for a private sector driven port, and was charged with the responsibility of transforming NPA into a commercial organization. In 1992, the Nigerian Ports Authority was commercialized and it changed its name to the Nigerian Ports Plc. though the ownership remained that of government. Four years after, it reverted to its former name as a parastatal under the Federal Ministry of Transport. The reversion however, did not affect its commercialization efforts (NPA Brand Manual, 2005). With globalization, government realized it lacked the resources and managerial ability to drive a modern seaport successfully (Razak, 2005). Around the world, governments and port authorities have withdrawn from port operations knowing that enterprise-based port services and operations would allow for greater flexibility, efficiency, and better services to port consumers (Notteboom, 2007). This made the disengagement of government from the activities that could be more efficiently provided by the private sector inevitable. The process of involving greater private sector participation and expertise in the Nigerian seaports began in 2003 by the National Council on Privatization (NCP), the apex policy body on sector reforms in the country, in conjunction with the Bureau of Public Enterprises (BPE) (Razak, 2005). The Nigerian government initiated one of the most ambitious infrastructure concessioning programmes ever attempted in September 2004 (Leigland & Palsson, 2007). The programme gained global credibility with the involvement of the World Bank, CPCS Transcom of Canada and Royal Haskoning of Holland as project monitors, concession bid managers and consultants respectively (Fivestar Logistics, 2008). The Haskoning study as it is referred to identified some of the bottlenecks to the port operations and recommended the “landlord” model approach. By July 2006, twenty long term port concessions were awarded with some more in progress (Leigland & Palsson, 2007).
1.2 Statement Of Problem
It is believed that the Nigerian Ports by the 1990s demonstrated very low levels of efficiency which resulted in long turnaround times for ships and increased container dwell time (Leigland and Palsson, 2007). Instead of the forty-eight hours international standard to unload and reload a ship, it took weeks. The workforce was overbloated, there were excessive port-related charges, and massive levels of cargo theft. The most unfortunate was that the port infrastructure required considerable rebuilding and restoration. This entailed massive external financial support which the federal government was unwilling to provide due to the existing corruption and operating inefficiencies. Hence, port operators and users were left dissatisfied (Leigland & Palsson, 2007). The Nigerian Ports as is the case in many other public corporations were also believed to have complex institutional management structure with stiff bureaucratic bottlenecks. In a bid to address some of the clear and immediate problems such as congestion and delays, the NPA introduced port concession to some of the ports in the country to bring in needed expertise in the area of operations. Concession is a process whereby the concession grantor gives the right to operate a facility and/or deliver a service of public interest to a merchant concessionaire, against the commitment assumed by the concessionaire to build and manage the subject of the concession or to manage the delivery of service at the concessionaire’s own risk (Tsvetkov, 2010). Studies on the circumstances necessitating the Nigerian Ports concession and the initial outcomes have been carried out (Akinwale & Aremo, 2010); others have looked at logistics and physical distribution at the ports (Ogunsiji & Ogunsiji, 2010). However, no known study have examined if some of the basic objectives of the concession were achieved five years after the concession, hence the need for this study.
1.3 Objective Of The Study
The general aim of this study is to examine concession as a strategic tool for port efficiency an assessment of the Nigerian Port. Specifically, the study will examine if;
a. The cost of port services has decreased.
b.The turnaround time has improved.
c. The percentage of berth occupancy rate has improved.
d.The infrastructural facilities have improved significantly.
e. The security around the seaports has improved.
1.5 Research Questions
Based on the objectives of the study, the following research questions deserve answers.
a. Is there significant decrease in the cost of port services?
b. Is there relative improvement in the turnaround time?
c. Is there improvement in the percentage of berth occupancy rate?
d. Is there significant improvement in infrastructural facilities?
e. Has security around the seaports improved?
1.6 Significance Of The Study
The study as anticipated by the research will be useful to the stakeholders in the Nigerian port sector. Precisely, the Nigerian Ports Authority (NPA) will find this study useful as it will enlighten them on challenges of the port sector. The study will help them determine the extent to which the objective for creating port concession has been accomplished.
Additionally, subsequent researchers will use it as literature review. This means that, other students who may decide to conduct studies in this area will have the opportunity to use this study as available literature that can be subjected to critical review. Invariably, the result of the study contributes immensely to the body of academic knowledge with regards to the impact of alternative sources of funding on Nigeria public libraries.
1.6 Scope Of The Study
The study is set to examine concession as a strategic tool for port efficiency an assessment of the Nigerian Port.. Further the study will cover but limited to ascertaining if the cost of port services has decreased, the turnaround time has improved, the percentage of berth occupancy rate has improved, the infrastructural facilities have improved significantly, and the security around the seaports has improved.
1.7 Limitation Of The Study
Like in every human endeavour, the researcher encountered slight constraints while carrying out the study. Insufficient funds tend to impede the efficiency of the researcher in sourcing for the relevant materials, literature, or information and in the process of data collection, which is why the researcher resorted to a limited choice of sample size. More so, the researcher simultaneously engaged in this study with other academic work. As a result, the amount of time spent on research will be reduced.
1.8 Definition of Technical Terms (Port Terminologies)
Gross Registered Tonnage (GRT): Ship internal space measured in unit of 100 cubic feet.
Ship Turnaround Time (TRT): Time taken by a ship on the process of entering Port, Discharging Cargo, Re-loading and leaving the port. Cargo Throughput: The sum of foreign imports, exports and domestic cargoes discharged and loaded.
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