 You're welcome back. There is this story that federal government has ignored a 17-year-old concession fee debt and is now renewing terminal leases. And to discuss this with me, I have Mr. Shergun Shock-Peton, principal partner, Woodridge and Scott Consulting and a public affairs analyst who has joined us. Good morning and welcome to the program, Mr. Shock-Peton. Good morning. Thanks for having me. Okay, let's start by understanding what it really means, the 17-year-old concession debt that is being talked about and how the federal government has ignored it. Well, so what's happened basically is that at some point about 20 years ago, the government of Nigeria decided that a lot of the services that were being provided at the port would be concession to private sector stakeholders who are deemed to be experts in the area, in the field of port management and logistics. The idea being, you know, they would run it more efficiently and as a result of the efficiency, our import and export facilitation services by the government would improve significantly. And then as a result of the involvement as well, they would be able to maintain the facilities at the port to ensure that their businesses run smoothly. Again, the argument being that being private people, their primary objective of profit would be impaired if they do not invest money in those things to ensure that facilities are in top-notch condition. Of course, for every concession agreement anywhere in the world, the objective would be that you run whatever the service is that the government has given to you to run on behalf of the government whilst you pay a concession fee or, you know, some sort of remuneration goes back to the government. It could be a fee, it could be a shell profit, you know, depending on what service, specific service we're talking about. In this case, there were concession fees that were supposed to have been paid by these concessionaires. Apparently, that has not been happening from majority of these organizations. And in spite of them failing to make these payments, it is now coming to light that their concessions are being renewed. So you then begin to wonder how exactly this is happening, what exactly is going on, if the fees are not being paid, then the objectives of the concession, the primary objective of the concession or one of the primary objectives of the concession is not being met. So how come, you know, the concessions are being renewed? So there are lots of questions being raised or being asked around this. And if you look at the details of the concessionaires, you begin to realize that a lot of the people involved are either politicians directly or people with political connections or persons of interest politically, you know, and then you begin to get some clarity as to what exactly is going on. Okay, so that means that they've just written off as bad debts, all the concession fees that were supposed to be paid. 17 years is not a short space of time. 17 years concession fee would amount to a lot of money in a country that is looking for money left, right and center. Let's just have a conspiracy theory, if that is how you would call it. Let's just have a theory. Why do you think this is actually happening? You say you begin to have clarity. In your own perspective, what is the clarity you're having? Why they are being renewed, the terminal leases are being renewed without that debt being paid? Okay, so first of all, I think it would be very useful to realize that the amount of money that we're talking about is in the hundreds of millions of dollars. Dollars. Yes, so that's the first thing to recognize. The concessioners have agreed to pay renewal fees ranging from between $1 million to $5 million when these agreements were executed. And if you calculate, so the information available is that fees between depending on which we have about 25 concessioners involved in all of this, and the fees that we're talking about to range between $100 million to $143 million dollars, everything totally in about $350 million is what is being owed currently. So we're talking almost a quarter of a trillion in revenues being lost by the government. Again, like I said, if you then just oppose this financial information with the fact that we're talking about either politicians or politically exposed people, you see that the only logical explanation for having this volumes of money being owed the government and yet concessions are being renewed is there's some sort of graft involved. There's some sort of graft involved either outright kickbacks where the money that is supposed to go to the government is being pocketed by a certain government officials or some people have paid a certain amount to look the other way while the money is owed. So it's not that this money will not be paid. I don't believe that because these are agreements that legally binding contracts. We're talking about transactions with private companies. One day, those debts will be paid. When that one day will come, I really can't say. One would hope that with the coming of the new administration, maybe that would resolve in some progress in this area. But we can only hope we'll have to wait to see how that plays out. However, going into the politics of this, if you recognize the fact that the last eight years have been under the presidency of the leadership of a man that was supposedly a man of integrity and a strong anti-corruption crusader, and yet something like this happened under his watch before his watch, but one would have thought that it would have been stopped under his watch. You then wonder if we have any logical business to hope that this will stop now, but we'll have to wait and see. All we can do is hope for the best. Of course, at the end of the day, it's the Nigerian people that are suffering. It's the Nigerian economy that is suffering. I'm sorry to do this, but I can't help but tie this to the subsidy question. Some of us have said repeatedly, and my position has always been that the subsidy is not the problem. And when people tie our fiscal problems, the fact that Nigeria is pretty much broke from a fiscal perspective, when we tie that to subsidies, we deny the reality that stares us in the face, the reality that a significant chunk and portion of Nigeria's revenues do not even get reported, does not arrive in the consolidated revenue account of the country. Those monies never arrive. And this is a fantastic example of what somebody like me has been saying since this debate erupted. These revenues have been lost to the government. And this is only one example. These scenarios like this are repeated across board, across all of the ministries and all of the agencies of government. If you are able to stop this, reclaim these revenues, in this instance now we're talking about a quarter of a trillion there, a quarter of a trillion. So if you stop this and then stop similar incidences across the different ministries, agencies, pasturals and all of that, then perhaps you would have enough revenues to provide the desperately needed subsidies that will ensure that consumption is not disrupted and that would potentially cold lead to either a recession or a slowdown of economic growth. One would only hope that the people that are in charge of running the affairs of the country and running the economy would brace up to the challenge at hand, will stop the revenue leakages and save the country from continuing to bleed from all areas of economic activities. Well, this hope is good to have hope, but you see the renewal of the lease is done by a new government which you are hoping will sit up to the responsibility and do what they need to do. I don't know how we can marry those two things together. Well, I mean, I did mention that. I did allude to that. But I also understand that one of the conditions for the renewal of these leases was that this outstanding debt to be paid by the concessionaires. And I think it's also important to perhaps concede that changing concessionaires is a painstaking process. It's not a work in the park. So I am not very sure that the option of terminating those contracts, for example, based on the failure of these concessionaires to have made these payments over the years, will be an immediate option. It's something that can happen. Maybe it's something that should happen, but it will take time. Are you not worried that there should be a supervising ministry? There should be some heads that should be in charge of supervising. And nothing is being said about this. There's no probe to that effect. It's just that, okay, let's renew this and there is a condition of renewal. What about the people who are supposed to be in charge that did not do their work right or may have, like you said, been receiving some of these kickbacks and letting it slide? Yeah, so this whole concession thing falls directly under the purview of the Nigeria Port Authority, which obviously is supervised. I think we have a blue ministry of a blue economy right now, Marina. So this would come under the purview of that ministry. The minister has just settled in or is just settling in. So there is the political leadership under the bureaucracy. The bureaucracy that sits beneath the political leadership will continue to do what they've been doing, which would explain the renewal of the concessions, the concession agreements. The agreements have come up and are due for renewal. They will get renewed, regardless of whatever is happening at the political top of the ladder. So one would hope again, I use that word because there's nothing else that one can do. One would hope that the new minister that is coming on board would, this would be one of the things that he would take on his plate and look critically into, ensure that consequences happen for people that have been involved in what I think is a scam and then clean it up and ensure it doesn't happen again. So when we talk about the blue economy, absolutely and certainly the port is a critical component of that. In fact, let's forget the issue of the lost revenues from this particular scandal, if you may. The reality is that for you to talk about harnessing the potential, the tremendous potential in the blue economy, your ports are critical components almost like a foundation. You have to fix your ports. They have to become efficient. You can't have a situation where goods arrive in the country and three months later you still are unable to clear them. And this is still happening till today in spite of these private sector concessions. So this has to be fixed. And one would believe that the new minister look into this, fix the inefficiencies and fix the corruption in the system so that Nigeria can benefit from it. Do you think there are specific policies that need to be formulated for this to work seamlessly? Well, clearly the policies currently exist, but I think that one of the things that perhaps we need to move towards is to take those policies and convert them to legislation. One of the reasons that this has happened or has been able to happen is that apparently there is no clear, there is no clear, what's it called? Sorry, there is no clear legislation. Yes, covering this. There is no clarity. So if, for example, a concessionaire is found to have failed in their duty to make payments to government, if that is found to be some sort of corruption, what is the consequence? In an ideal situation, of course, what you would have is that in the concession contract, there would be perhaps maybe the risk of the concession being terminated for failure of meeting the terms of the agreement and all of that. But beyond determination, what consequence would the concessionaire have to face? That there is no clarity with regards to that. So I think that the new minister will need to look into all of this, integrate all of the existing policies surrounding the different nodal points of the value chain in the marine sector and ensure that critical legislation is taken to the National Assembly to remove any ambiguity and any loopholes that mischief makers might be taking advantage of. Okay, Mr. Chauputin, thank you so much for your thoughts this morning on the program, where it has been a pleasure having you. Thanks for having me. Okay, we're talking with Mr. Shagwin Chauputin, a principal partner with Regions Quartz Consulting and he's a public affairs analyst. And in that capacity, he was talking with us on the fact that the federal government has neglected the 17-year-old debt concession debt and is renewing the leases right now. So he has put more light on that. We'll take a short break when we return. We'll be on to our second hot topic, which is the fact that workers are threatening to withdraw from the National Housing Fund over unremitted funds. Stay with us.