Mr. Dallas Hampton is the managing director, APM Terminals Apapa Ltd, a major seaport concesssionaire for cargo terminals and controls about 50 per cent of container operations in the country. In this interview with SAMSON ECHENIM, he proffers a positive thrust for the Nigerian economy even as he speaks on how his company has impacted Nigeria’s import and export business landscape.
Your company is one of the largest seaport concessionaires in Nigeria. How has the task of handling the country’s biggest seaport been?
That’s not quite correct. When you talk about port, I think you need to consider that there are many aspects of port. Container terminals are one that seems to get the most focus but there are a number of other ports such as those for liquid bulk as well. However, Lagos is an enormous port for cargoes. It’s also a large port for general cargoes as well. And of course, APMT is probably one of the largest companies in Nigeria and a very big operator in Apapa. We probably handle about 49 or 50 per cent of the container market. There are other operators handling containers in the port. Predominantly in Tin Can there are a number of operators, but put together, I think it must be a perception or a conception that APM Terminals is the biggest operator in the port but it’s not really quite true. We are a big operator, but we are not the biggest.
What is APMT’s level of investment in Nigeria?
It’s very extensive. Till date our investment is about $200 million. But we have just announced a new extension in the terminal, where we will spend another approximately $135 million. So, that will be on top of whatever we have invested till today, which is about $200 million. So, we are probably getting to $330 million or $335 million which we have either spent or committed to spend at the port.
What areas of your operation are you putting the $135 million?
The terminal has been unable to take some of the original parts of the concession because of various reasons. Some have not been handed down to the terminal by the ports authority (NPA) and that recently happened and we are taking over that area for cement import works. I understand that there are plans to produce cement in Nigeria but along the line they import the facility. So, we are going to take over those areas and develop those areas into modern container terminal yard. It’s also great to take on the areas we have been resisting and as replacement of old model of operation to a new model of operation. So we are investing in equipment, some civil works and also redevelopment of the areas which has recently been handed over to the terminal.
By virtue of the position your company occupies in the Nigerian business landscape, you may be in a position to say where the country stands in terms of import-export balance?
It’s quite open and available and the ports authority here is probably in the best position to provide that information. But, if you talk about our terminal for only containerised operation, it’s about 10 per cent in export cargo that is, containers that are leaving Nigeria and the rest are import containers and empty containers. About 50 per cent are of import containers, the other 50 per cent goes off: 10 per cent for export cargo and the rest of about 40 per cent are empty containers. But that’s it about this terminal. But I think we will not be very different from the others, but of course, the port authority is the one to have the figures for the entire ports and for all of Nigeria.
You have been in business in Nigeria for six years now. How have you impacted on the Nigerian business environment?
Yes, the terminal recently marked its sixth-year anniversary in Nigeria. Well, one of the early factors ,though I wasn’t here when it started, was that there was a real lack of capacity in terminal itself. There was also a long waiting time for ships. I learnt that waiting time takes up to three weeks for container vessels to get to berth in the port. So, if we contrast some of those factors against where we are today, the terminal has increased its storage capacity to well over 60 per cent and the waiting time for vessels today as we speak for this terminal is around one day on the average. Some ships come straight in, no waiting time at all while some just have to wait a little bit longer, but whichever it is, it is less than one day and that’s quite normal for container terminals, yes.
It appears you are doing good business in Nigeria. Would you want to renew your contract when it expires?
Yes, APM Terminal is open to possibilities. The concession started in 2006 and it will end in 2026, so absolutely we want to continue in a long term. We believe in the future of Nigeria. Nigeria is developing very well. Recently we talked about economic information about some positive indicators in the country as a mid-level country economically. It’s clear that Nigeria is improving in its economy and we see a bright future. So, as an investor we are interested in making a fare return but, also providing a better service to people of Nigeria, we want to be part of that future.
There is a kind of mix up in the identity of your company and Maersk Line and very often, there are complaints among clearing agents that your company charges high demurrage. But what you charge in essence is storage fees while the shipping company charges demurrage. Do you see a need to clarify this mix up?
I don’t know the need to clarify that! But I do think some people might want to represent it that way, but I should think they really understand that there is a difference. So, we keep saying the same thing again. APMM is a group, the Maersk Line is one company and APMT is a different company.
How are you coping with handling issues of examination and scanning?
Yes, this has long been problematic issues. For the terminal, this is indeed a big issue. The percentage of containers which require scanning or physical inspection in Nigeria, I will have to say, is far higher than in most of the countries in the world. So, there has been a constraint on the capacity of the port and the capacity of our terminal in particular. What we have done is, once the scanning was introduced, it didn’t work as much as it should so we have actually taken over operation of the scanning, not the scanning itself, but operation of the scanning facility. What this means is that there has been approximately 60 per cent increase in the number of containers which can be scanned in the facility here. So, that’s a significant improvement and that means that there has been some reduction in the number of containers which require physical inspection.
Also APM Terminals last year introduced the new system of inspection allowing our different stations to make it attractive for people to use scanning at a lower cost rather than have their containers physically inspected. As a result, we are seeing some reduction in the number of containers inspected. But also, the government, the port authority in particular has been leading the push to remove some of the myriad organisations previously insisting on inspection in the port. This has also reduced time spent on inspection of containers. I do hear in some reports that some of those organisations want to come back. Let’s just contrast that with some countries (I’m not talking of any country in particular but countries) in Africa where the Customs is really the only authority that is laden with responsibility for inspection of containers. I think that is a very important thing. There is need for more improvement and the need to reduce the number of containers that need physical inspection.
Talking about the Customs, does the terminal operator have a means of helping the Customs to know what a particular container is laden with? Do you have such arrangement?
At this terminal, certainly we do many things to help the Customs—we work very closely with the Customs—and of course, the issue of scanning and inspection, we have also helped Customs to inspect more cargoes and help them to raise more duties, because they get better inspection. But, if we talk about what is inside a container, the terminal operator as a principle does not have details of information about what is inside a container. The shipping line does and the Customs and the shipping lines are linked by an electronic system whereby the manifests are directly available to Customs. So, it probably has a full picture of what is inside a container. The shipping line ensures the manifests are sent to Customs before the vessels arrive, so that the Customs can know exactly which container to inspect or not to inspect. The terminal operator ourselves, we don’t really want to know about what is inside a container unless of course there is something inside that we have to deal with—may be some information that is important for the security aspect.
You were supposed to do some rail construction around the port complex for multi-modal transport system expected to aid smooth container evacuation. How far have you gone with the project?
Well, we are almost ready. But actually, it is no responsibility for us as a terminal operator to execute any rail in the concession agreement. There isn’t any mention of rail in our concession agreement, but it’s about the ports authority supplying that facility for us to use. We are ready to use rail now. The ports authority has done some great work recently and certainly, I have to thank the head of the NPA, Mr. Omar Suleiman. He has been very helpful and by the newspaper reports that I read, I think it is getting to the completion of works for the port rail link. May be last month or two weeks ago we saw them working on the trail. All that is needed now to continue that process is for the national rail company to do its part and then as far as we are concerned we are very willing to participate in evacuating containers by rail. I think a lot is being done on it, but it’s not quite ready yet. Certainly, the ports authority has been very helpful.
Stakeholders in the maritime industry have been asking for an economic and commercial regulator for the seaports. Will APMT be ready to cooperate with an economic regulator if established?
We are ready to cooperate with whichever institution the government establishes in the industry. However, I find this discussion a little bit surprising because there is already a regulator and that regulator is the Nigerian Ports Authority and I can tell you that the last increase in the terminal handling charge (there has only been one increase since we began operation) the NPA, ministry of transport and the Bureau of Public Enterprises, which is also part of the contract approved it. So, for us to say that agents have no institution to take their complaints when the ports authority is there is surprising to me. And that is why I mentioned that the only charge especially for importers has been one increase in the six years that the terminal has been operating and that was approved by the Ministry of Transport and the NPA. Recommendations were sent to the ministry and later, some considerations were agreed to the increase. So, to me, that is a system that works — a system where there is already a regulator. What would you need a regulator to regulate a regulator? It just seem like an unnecessary duplication of roles to me and our charges are ultimately controlled by the ministry and the NPA. I think appointing another regulator simply means someone else to regulate someone else. To say that there is no one to complain to about what happens in the port is not correct.
The ports were said to be concessioned in a hurry. Hence there are current agitations by the Ministry of Transport and the National Assembly to review these contracts. Would you say that APMT actually followed due process in getting this contract?
Excellently and yes absolutely. The government called for the companies to participate in tendering for the concession and although I was not here when it happened I know how APMT operates and everything that we do is very clear and open. We were selected from a number of tenders from the Bureau of Public Enterprises and the ports authority and the reason we are selected was because our offer predominantly was that we were technically proficient operator and that we were also to provide the maximum satisfaction to the Nigerian government and to the masses.
The road leading to the port is in a messy condition, do you see that as an opportunity for your company to embark on tangible social responsibility project?
Certainly, that is a very interesting subject. It was an announcement by the ports authority that it has begun development of 1.6 kilometres of road in the port. Now, that is something that I think was delayed as it was what was originally planned for last year. So, the ports authority is already doing something about the port access road and it’s quite a large project. To be honest with you, the real issue with the road is not exactly the condition of the road but, the number of trucks parking on the road. I have been to many ports around the world and I will be very happy to say that the road network here is very okay. The problem is that there are too many trucks parking on the road for various reasons and that is the issue that we should be addressing.
Unfortunately we don’t control the roads, except in our terminal. So, that aspect is better directed to the police, the road authorities and the government. We believe that where to put our money for social responsibility is those who are the most needy. So, we have extensive input into orphanages, education in particular, repair of schools, sponsorship of scholarships and we believe this is a very good area to try and improve to invest. The roads I think generally are the responsibility of the authority.
CSR is about sustainability and consistency, no matter whether the company makes profit or not. Most firms in Nigeria are simply into what experts call corporate philanthropy.