Why NPA Is Planning $1.1bn Ports Rehabilitation Project, How It will Raise Fund

NPA MD, Muhammed Bello Koko

The need to improve the physical infrastructure of the Nigerian seaports , increase their capacity to accommodate bigger vessels as well as  upgrade the drafts at the quayside to 14 meters among others, has informed the $1.1 billion Port rehabilitation being proposed by the Nigerian Ports Authority(NPA).

The Authority has likewise launched the $1.1 billion exercise to enhance the competitiveness of the Nigerian seaports and undertake a comprehensive automation of their processes and procedures to enable them, to be more efficient and be fully equipped to  take their rightful, place as the hub of the ports in West and Central Africa.

It will be recalled that the NPA Managing Director, Muhammed Bello  Koko who had revealed this in a  panel session at the  recently concluded 43rd Port Management Association of West and Central Africa (PMAWCA) conference,in Lagos , had added that almost every port in Nigeria is old and requires rehabilitation, but that the rehabilitation   will start with the Tin-Can and Apapa Ports in Lagos.

The NPA plans to kick off the rehabilitation process at the Lagos seaports  of Apapa and Tin Can  because, they harbor Quay aprons, that have been dilapidated ,while  their facilities and some of  those in  Rivers and Calabar Ports ,  can no longer withstand the remedial works being carried out on them , for the fact  that they have existed for  over 70  years , beyond their 50 years lifespan , before they  are rehabilitated.

But  as it concerns the  full automation of the ports operations in the country , the current management has since its inception adopted  deliberate measures of undertaking  investments , with a view  to creating , a fully digital ecosystem in all the  port locations by 2025.

This is hinged on its conviction that a  digitalised port helps in making better informed operational decisions, increases efficiency, improves collaboration amongst stakeholders, and lower port costs as well as  assist  to meet the ever increasing customer expectations in a timely manner.

This is why the Bello Koko- led management has already gone deep into  the process of  deploying at the Ports,    what is called the Ports Community System(PCS), which is an electronic platform , that will link all the stakeholders in the Port system for purpose of communication and enhancement of delivery and clearing of goods.

The  International Maritime Organisation (IMO)  , which is the Consultant to the NPA  ,has paid the  fees to the technical  consultant on the project  for  the first and second phases, as it offered to do, while the project is set to enter the third stage.

Already, in the first and second stages of the project , the NPA  has been able to get  the   stakeholders in the maritime industry, from the shipping lines to the freight forwarders, terminal operators, users of the ports, Standards Organisation of Nigeria(SON), among others to deliberate with the   technical consultant  with a view to bringing them all to the Platform.

Consequently ,  the consultant  has studied  what each one of the aforementioned  agencies  has in place in terms of IT deployment and automation, while in the next stage , which is the third stage , it will  do an analysis of what is needed to be able to deploy the PCS.

Invariably, the plan of the NPA management is for the  PCS to  serve as a catalyst for the National Single Window, which is a Platform that is superior to the PCS and which  enables trade facilitation and speeds up the processes of documentation for importers and exporters .

Though the NPA MD did not explain how the fund to prosecute the projects would be sourced , but indications are that it would  still resort to borrowing  from international lending  institutions .

The  international lending institutions that  have  been considered by the NPA include the French Development Agency(AFD), African  Development Bank(AfDB), European Investment Bank(EIB), among others, but the NPA management  might have   opted for the  African Export- Import Bank(AFREXIM)  for a loan put at about  $800 million as at last year, while the depreciating value of the naira must have increased the loan to $1.1 billion.

The idea was that   the NPA will borrow the  money for a  period of about 10 years, with three years moratorium, meaning that  provisions that would be made for the  payment of that loan,  would make the repayment to kick off,  in 2027, if the loan scales through in 2024.

The management had   also earlier   considered  using part of the NPA revenue for  the project  , a situation  , which would however reduced its contributions to the CRF, a development , which made the management to opt for the loan option .