Terminal Operators’ N5trn debt stalls port infrastructure upgrade- FG
BY FRANCIS EZEM
The Federal Government has raised serious concerns over huge debts estimated at over N5trillion owed it by some terminal operators arising from the inability of some them to meet their financial obligations under the Port Reform Agreement is partly responsible for the infrastructure deficit at the nation’s seaports.
The Federal Government as represented by the Bureau of Public Enterprise BPE and the Nigerian Ports Authority NPA, on the one side and the terminal operators had signed a tripartite agreement on the port reform programme, which stripped NPA of its cargo handling functions and transferred same to the terminal operators, who are supposed to pay certain per cent on tonnage.
Deputy Chairman, Senate Committee on Marine Transport, Senator Kabir Gaya, who spoke in Lagos, regretted that many terminal operators have failed to meet their financial obligations to the government under the Port Concession Agreement, which impedes the ability of the government to carry out some infrastructure upgrade at the ports.
While admitting that there is huge infrastructure gap at the seaports, which also negatively affects operational efficiency, however noted that the inability of some terminal operators to meet their financial obligations to the government, which runs into trillions of naira was not helping matters.
According to him, the Apapa-Oshodi Express Way and some parts of Creek Road are still locked down in traffic due to the poor state of the roads, but regretted that the government’s hands are tied due to the huge debts owed by these terminal operators, which ought to have been deployed for the maintenance of some of these roads.
Senator Gaya, who doubles as Chairman, Senate Committee on Works, also disclosed that the government is currently working on over 34, 000 kilometer of roads across the federation, which has very huge financial implication, especially given the revenue shortfalls being experienced over the last few years.
It was gathered that given the huge indebtedness and the dwindling revenue, the government is currently tinkering with the idea of seeking private investments in road infrastructure development, which gave rise to the Public Roads Bill, an executive bill currently at the National Assembly.
“I agree with many stakeholders, who said that many port access roads including the Apapa-Oshodi Expressway are not working. The government is working on over 34 kilometer of roads across the country and you know it is not easy. That is why it is considering the Public Road Bills because there is need for private investments to come in.
“However, some terminal operators owe the government trillions of naira, which should have also been deployed into road infrastructure upgrade. So I use this medium to once again urge these terminal operators to pay up this unremitted tax revenues so that the government should be able to do more in terms of road infrastructure upgrade”, Gaya also said.
He assured that some of the traffic congestion on some port feeder roads would soon be a thing of the past, as efforts are being made to ensure that the Tin Can Island Port Truck Terminal becomes operational before the end of the first quarter of 2019, which will take some trucks off the road.
Recall that Chairman of the Seaport Terminal Operators’ Association of Nigeria STOAN, umbrella body for all the terminal operators had said recently that there was need for the government to review the Guaranteed Minimum Tonnage GMT, which will form the basis of a new payment schedule to the government.
She had argued that the country’s cargo throughput at the time the port concession agreement was signed had reduced drastically, a development that requires a downward review of the GMT, which may also form the basis of the review of the concession agreement.