Nigeria’s Ministers of Industry, Transport accused of subversion

Intels Logistics Services*Promoting coercive monopoly of INTELS
*Undermining investments

Hector Igbikiowubo

12 November 2013, Sweetcrude, Lagos –
NIGERIA’S Ministers of Industry, Trade and Investment, Mr. Segun Aganga and his counterpart in the Ministry of Transport, Senator Idris Umar appear to be working at cross purposes with the economic aspirations of the President Goodluck Jonathan administration.

Investigations reveal that both Ministers have been actively promoting the coercive monopoly of INTELS Nigeria Limited to the detriment of other investors, accelerated job creation and investment growth within the country’s economic space.

This much was also contained in an open letter addressed to President Jonathan by a Port Harcourt based Group calling itself the Coalition 4beta9ja, signed by its Co-ordinator, Mr. Fubara S. Ipalibo.
The Coalition recalled that in 2005 a Committee was set up to investigate several complaints and petitions received from port users and other operators against INTELS and the committee recommended the following, among others:
– The proximity of the management of INTELS to the political class should be re-examined and curtailed to check its abuse;
– NPA should ensure that cargo owners are free to patronize any truck of their choice for the freight of cargo discharged into Oil and Gas Free Zone, and in addition, importers of oil and gas cargo should be free to choose their port of preference;
– The ministry of Transport should fine-tune its regulatory and oversight functions to ensure that companies conform to rules and regulations in the country.
The group noted that all of these recommendations were advanced by the committee to check the ‘strangulating and uncompetitive activities of INTELS and allow the economic reforms of government to take firm root’.
Checks confirm that the Ministry of Transport has in place various contractual agreements with INTELS Nigeria Limited, a private sector entity, which concessions the statutory duties of the Nigerian Ports Authority especially as it affects control and management of the Lagos, Warri, Onne and Calabar ports.
Based on these agreements, the Ministry has outsourced the statutory responsibilities of the NPA for cargo movement, in and out of these ports to INTELS, in violation of several presidential directives issued in 2006.
The leasing and outsourcing agreement entered with INTELS seeks to confer on it a monopoly as the only operator providing logistics services in the oil and gas sector in Nigeria to the detriment of other service providers.
At the recently concluded Trade and Investment Forum which took place at the Onne Oil and Gas Export Free Zone, the Minister of Transport sought to press the coercive monopoly of INTELS when he stated that oil and gas cargo is only allowed to be moved through established port facilities, adding that private jetties are not authorised for such movement.
However, the position of the minister of Transport is in direct violation of Mr. President’s directive instructing the NPA to ensure that cargo owners are free to patronize any port of their choice for the freight of cargo discharged into oil and gas free zone and not only Onne or any other controlled by INTELS.
Similarly, industry operators have expressed concern over Mr. Aganga’s predisposition towards driving INTELS coercive monopoly driven by a partnership which enables the company to operate government assets, and encourage other government agencies to provide unhindered services.
Industry operators note that it is rather ironic that Mr. Aganga has ignored other free trade zones under his oversight, which are plagued with problems accentuated by government agencies’ denial for the right of full operation as free trade zones.
Some of these other free trade zones which have been ignored by Mr. Aganga include the TINAPA Free Trade Zone with the Custom Service, Lekki Free Trade Zone with NNPC on gas to make the zone function as expected, and the Lagos Free Trade Zone with NNPC on gas to produce methanol, which forced them to go into trading.
Others like the Kano Free Trade Zone remains neglected and underdeveloped since 2000 when it was conceived by Federal Government, while Calabar, the pioneer free trade zone in the country is still struggling to stand on its feet.
The Snake Island Integrated Free Zone, the first private free integrated zone is struggling to get patronage with its first class Ship Yard necessary for industrial take off of Nigeria, while LADOL is equally battling to survive in a harsh economic environment, compounded by government neglect.

While these other free trade zones are struggling to stay afloat, the Minister of Industry, Trade and Investment is preoccupied with promoting INTELS with government funds and patronage from its agencies.
SweetcrudeReports checks reveal that the Onne Oil and Gas Free Zone Authority is also a victim of the promotion of INTELS by both the ministries of Trade and Investment, and Transport.
“The Authority is only allowed to flag the name and symbol of the Free Zone Authority but is not allowed to regulate, operate and manage the zone as its enabling law stipulates. The land where the free trade zone is sited belongs to NPA, but it has been leased to INTELS for 25 years and renewable for another 25 years.
“Essentially, the Oil and Gas Export Free Zone Authority is a squatter in a zone where it is supposed to operate, manage and regulate,” an industry operator who did not want his name in print volunteered.

He said unless the Federal Government acts to sanitize the environment, Mr. President’s transformation agenda will not be met.
Only recently, President Goodluck Ebele Jonathan had while receiving the new Ambassador of the European Union, Michael Arrion, disclosed that the federal government will continue to give necessary encouragement and protection to emerging industries in Nigeria to ensure steady economic growth and facilitate the creation of more jobs in the country.
Mr. President said that in protecting its industries, Nigeria will not be acting differently from the advanced nations of the world who, at similar stages in their development, put measures in place to protect their domestic production.

Even though the Mr. Aganga claims he is committed to implementing Mr. President’s Transformation Agenda, anchored on inclusive economic growth and diversification through job creation and wealth generation, it appears the minister believes this can only be accomplished through coercive monopoly.

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