Dr Kabir Bello, a socio-economic analyst from Abuja uses a case study to discuss the federal government’s transport sector framework….
The Federal Government’s recent disclosure of its plan to privatise the transport sector should gladden the hearts of Nigerians and potential investors alike. Considering the important position of the country as the largest economy and most populous nation in the African continent, which lately had the honour to be the first in West Africa to host the World Economic Forum (WEF), the direction that its transport sector is taking should be of interest in public discourse.
The decision of the Federal Government which was taken at the Federal Executive Council (FEC) meeting in Abuja was specific in its objective: “To open up the transport sector to the public for private participation.”
According to the Minister of Information, Mr. Labaran Maku, who highlighted the FG’s intention on this issue, four bills aimed at transforming the sector were discussed in detail: The National Transport Commission Bill; the Nigerian Ports and Habour Bill; the Nigerian Railway Bill 2014 and the National Inland Waterways Bill 2014.
According to Maku, government is working on an economy that focuses on the future, and one that is not expected to rely on the government, but on private sector and its participation. Indeed, he was on point when he explained that the President Goodluck Jonathan administration would “involve the private sector in the development of the infrastructure in airports, seaports and waterways”.
The fact that he added that government could no longer continue to run the sector on its own and that the best way to further improve Nigeria’s economy is to create new policies for different sectors of the economy that will drive private sector participation rather than for government to just continue to pour in money on investments really appears to have captured the essence of private-sector driven economy that most developing countries like Nigeria now subscribe to.
But keen analysts of the Nigerian economy, particularly how successive government’s policies tend to disrupt or even outrightly derails progress, will appreciate why Federal Government’s latest interest in transport sector privatisation deserves to be discussed and interrogated. And perhaps no better way to engage the beautiful postulations from government, while we await the report of the committee working on the framework for the bills, is to remind government and the nation of a few courageous men in our land who had ventured into massive investments in the private sector but who have been made to suffer from either policy inconsistency or deliberate frustrations from government agencies. This is an important area to examine because public trust and interest of potential investors can only be convincingly won if those few individuals who have stood up to be counted for the right cause in the transport sector are seen to be treated fairly.
The case of Dr. Wale Babalakin’s BiCourtney Ltd comes handy as a reference point in private investment in the transport sector. The company was the first to build and operate an airport – the Muritala Muhammed Airport (MMA) 2 in Lagos – which, seven years after, is still standing firm as a world-class infrastructure. It is important, therefore, that the experiences of the promoters of such a project, which did not have the luxury of the kind of legal framework and the assurance of removal of bureaucratic bottlenecks that the Federal Government is now promising, ought to be taken on board if the intention of the Jonathan administration regarding these four proposed bills is to be taken to heart.
However, the stories that have trailed the success of MMA2 are sufficient to jolt investors and get the nation pondering. Government has failed woefully to honour its agreement with MMA2. It violated the most important clause of the agreement which is exclusivity. It has gone ahead to compete with MMA2 next door. How can a government that is promising reforms in the transport sector compete with its own concessionaire?
As if that was not enough, government has refused to honour court rulings. Not only did BiCourtney win its arbitration against government, it has also won in the High Court. The Federal Government and other stakeholders have lost six appeals against this judgement and yet the FG is not complying with the Agreement.
The same Babalakin’s BiCourtney is also being vilified over the Lagos-Ibadan Expressway concessioning which the Federal Government curiously terminated in 2012. But a careful and unbiased assessment of the issue would reveal that out of the three years and six months that BiCiourtney had the concession, direct delay by the Federal Government was two years, 10 months; rains accounted for another six months which showed that in effect, in a period of three years and six months, BiCourtney only had two months to work properly and did commence the work through Borino Prono.
I am aware of the level of work that is currently ongoing on that important Lagos – Ibadan road, but anyone who is knowledgeable about and sensitive to issues of law and legality would not miss the point that it might not be totally over as far as the legality of that purported termination of BiCourtney’s concession is concerned. Like the MMA2 issues, investors and discerning public would be interested in seeing how the final resolution would go beyond the mere award of contract on the road to Julius Berger Plc and RCC. For example, when was the tender for that job done? If there was no tender, wouldn’t the contract be deemed illegal? Again, it would be asked, if indeed there was a tender, then the process must have taken place while BiCourtney was being misled into believing that it had a concession with the Federal Ministry of Works.
The point of interrogating government’s recent interest in the transport sector is that if the Lagos – Ibadan Expressway concessioning ends in arbitration, wouldn’t the Ministry and its contractors be seen to have, all along, been working for the cocncessionaire who may likely find justice in court?
Well, the Federal Government has since set up a committee chaired by the Attorney General of the federation, Bello Adoke, alongside Minister of Transport, Umar Idris, with participation from key stakeholders to work on the bills and present them to council for discussion and final approval. In fine-tuning the bills before their presentation to the National Assembly for consideration, it is pertinent to see the government applying wisdom and sincerity in pushing the needs for these bills.
Such a legal framework is a welcome development, no doubt, but it can’t function effectively and fairly without an appreciation of certain good reference points in the sector that will ensure that potential investors are no longer subjected to needles injustices of frustration, heavy losses and regrets.
