39798 noTE NO. 17 – Mar. 2007 GRIDLINES Sharing knowledge, experiences, and innovations in public-private partnerships in infrastructure
Public Disclosure Authorized Port reform in Nigeria Upstream policy reforms kick-start one of the world’s largest concession programs James Leigland and Gylfi Palsson
ver a two-year period, beginning in late structure concessions can be concluded, are often 2004, the Nigerian federal government ignored in efforts to seek short-term solutions to Oimplemented one of the most ambitious urgent problems in infrastructure sectors. port concessioning programs ever attempted. The success of this program resulted from the government’s vision and decisiveness, as well Impetus for port reform in Nigeria as the need to remedy massive shortcomings in the sector, which were sharply inhibiting Nigeria’s willingness to take forward port reform Public Disclosure Authorized economic development. But the program also initiatives in the late 1990s is a testament to the benefited strongly from policy reform recom- strategic vision of government officials as well as mendations made by PPIAF-funded consultants the size and scope of existing problems in Nige- in 2002. The role of these “upstream” policy ria’s port sector. By the 1990s, the Nigerian ports and planning recommendations highlights were demonstrating very low levels of efficiency, the value of best practice steps for creating which resulted in long turnaround times for ships an enabling environment in which sustainable and increased container dwell time. It often took arrangements for the private participation in weeks to unload and reload a ship instead of the infrastructure can be concluded. 48 hours considered standard in other regions, such as Asia. Moreover, the workforce was over- staffed and unproductive, cargo was subject to Introduction massive levels of theft, and port-related charges were excessive. Perhaps worst of all, the port
Public Disclosure Authorized In September 2004, the government of Nigeria infrastructure required substantial renovation and initiated one of the most ambitious infrastruc- rehabilitation, and such investment was going ture concessioning programs ever attempted. By to require substantial external financial support, July 2006, 20 long-term port concessions had which the federal government was reluctant to been awarded (with six more in progress); two provide given the existing operating inefficiencies new legislative acts governing the port sector in the sector. were under final consideration by the National Assembly; an act establishing an independent After the end of military rule in 1999, the newly regulator for all modes of surface transport reconstituted National Council on Privatisation had been drafted; and an awareness-building (NCP) put port reform high on its agenda. After campaign to support the port sector reforms had a series of internal government consultations, the been00)!&