Why we increased our tariffs after 33 years – NPA MD

The Nigerian Ports Authority (NPA) has secured necessary approvals for a 15% upward review of its tariffs and dues, 33 years after the last review.

NPA said the review was necessary considering the urgent need to address the undesirable reality of aged and weak Infrastructure, obsolete equipment and slow Port capacity expansion which has continued to diminish the performance and indeed competitiveness of Nigerian Ports.

The Managing Director of NPA, Dr. Abubakar Dantsoho, disclosed this at an interactive session with all port stakeholders in Lagos today, to seek their understanding on the increment.

Represented by Olalekan Badmus, Executive Director Marine and Operation, Dantsoho said the management decision to meet stakeholders was borne out of desire to carry everyone along

Speaking at the meeting, Joshua Asanga, a stakeholder, agreed with the increase adding that the value of NPA present tariff has since been diminished by inflation which is at about 35% .

Asanga listed port management liabilities like wages, fuel and other areas of expenditure as having adjusted upwards without a commensurate rise in NPA charges for over thirty years

He added that NPA needs funds for improved port infrastructure, robust ICT for Port Community System, procurement of tug boats and other operational platforms to achieve efficiency

Another stakeholder, Demian Ukagu, talked on the need to apply more NPA funding to outer port facilities and jetties like the Kirikiri Lighter Terminal and development of other critical port facilities across the country.

He added that NPA rates should be able to cover these cost that would guarantee minimum return on investment and promote sustainable trade.

The meeting agreed that existing tariffs were set devoid of capital cost, labour cost, consumables and overhead expenditures needed to run the ports

They feared that keeping the ports on the old tariff would promote consequences like poor service, inadequate infrastructure,poor remuneration ,obsolete critical port facilities, equipment and infrastructure

Globally, Port Authorities depend on revenue from operations to stay alive to their responsibilities which includes construction and maintenance of Port infrastructure, dredging of channels, provision of aids for safe navigation, provision of modern marine crafts for efficient harbour services, automation and digitization of port transactions, port security, energy efficiency and training and retraining of its employees.

The global index of Port rating and competitiveness which the international trade community relies on for its choice of countries to do business with, derives its data from how well the aforementioned responsibilities are addressed.

Coming at this period of global economic upheaval and scramble for markets, this belated Tariff review borne out of necessity constitutes a critical success factor in Nigeria’s quest to win back cargo handling business and it’s accompanying benefits including job opportunities it had lost to it’s maritime neighbors.

Contrary to the popular but erroneous notion that attributes high port costs to NPA relative to its peers, verifiable data shows NPA Tariffs are amongst the lowest in the region.

The high incidence of unreceipted costs due to unduly high human interface, bureaucratic bottlenecks, functional overlaps resulting from absence of a Port Community System (PCS) and its corollary the National Single Window (NSW) are responsible for this contrived falsehood.