“DRIVING THE AGRICULTURAL SECTOR THROUGH SAFE AND SUSTAINABLE TRANSPORT.” BEING TEXT OF PAPER PRESENTED BY OSITA CHIDOKA OFR CORPS MARSHAL AND CHIEF EXECUTIVE FEDERAL ROAD SAFETY CORPS DURING THE 19TH NIGERIAN ECONOMIC SUMMIT GROUP HELD ON MONDAY 03 SEPTEMBER, 2013 AT THE TRANSCORP HILTON HOTEL, ABUJA PROTOCOLS INTRODUCTION As the nation rises to the challenges of economic diversification through renewal focus Agriculture, the total cost and infrastructure requirement must be holistically addressed. Listening to the various papers and presentations today, I am convinced that the country is on the right track to food sufficiency. The comprehensive effort at policy articulation and execution spanning the entire value chain of the Sector presents a fresh and interesting dimension to the realization of the transformation agenda. Nigeria’s mainstay used to be Agriculture as developed by the Colonial Masters. Their focus during the Colonial period was primarily Agriculture and a lesser degree mining. The focus on Agriculture yielded the groundnut pyramids, cocoa and palm oil farms across the country. However, the key to unlocking this opportunity was transportation hence our Railway lines were built to maximally harness our Agriculture potentials. A simple study of the Railway lines clearly recalls the food production map of the 1950s to 1960s. Railways made the Agriculture growth possible. In the 1960s an event of significance happened that changed the Nigerian transport Sector. A strike by the Railway workers and the emerging political tension led the Northern Regional Government to fund and promote trucking as an alternate means of transporting their agricultural produce. That decision to decrease the monopoly of the Nigerian Railways gave birth to the haulage industry for long distance goods transportation. During the oil boom and the attendant growth in fuel consumption, the country invested heavily in another transportation mode: pipelines, to facilitate transport of crude and refined products across the country with trucking providing the last mile. Again, transportation made the growth of the downstream Sector possible. However, the breakdown of the pipelines and growth in fuel imports brought trucking to the fore of the transportation chain for the downstream Sector. The unplanned and unregulated growth in the wet goods trucking segment created costly externalities that continues to plaque the nation till today. As at last year, about 5000 trucks plied our roads daily to move about 150million litres of fuel we consumed. If the pipelines are not restored; if fuel imports does not abate and if the economy grows as projected, Nigeria will require 20,000 trucks daily to fuel the economy. The story of the downstream trucking industry would have been worse if not for the safety standards of the international and local oil majors. The enforcement of standards on their transport contractors greatly helped wet cargo segment of the trucking industry. The lesson: regulators and planners of the oil industry failed to include the transport component in their strategic plans for the industry. To realise the objective of transforming the agricultural sector to become the mainstay of the country’s economy, the Federal Government, according to the Vision 20:2020 has planned to invest the sum of $4.5 billion USD1 by the year 2020 in developing the agricultural sector as the food hub for the continent. The National Integrated Infrastructure Master Plan (NIIMP) envisaged the growth of the agricultural sector in producing 70% employment contributing 30% to the GDP2. Transportation occupies a central position in the socio-economic and political development of any nation. An efficient transport system is an essential component in the production and distribution of goods. Current mainstream development theory suggests that economic development is a function of efficient transportation system that provides better access to markets and work opportunities through improved mobility. Production chain remains incomplete until finished goods reach the end consumer with transportation providing the critical link in the completion of this process. By way of example, transportation played and has continued to play a key role in the success of the U.S. agriculture industry. In the Bureau of Transportation Statistics (BTS) realese of the US department of Transportation for June 2013, the US North American Free Trade Agreement (NAFTA) freight numbers showed that trucks carried 60.7% of the $93.5 billion of freight moved in June 2013 between the United States and its NAFTA partners, Canada and Mexico. Trucks were followed by rail at 15.8, vessels at 8.2%, pipelines at 6.5% and air at 3.9%. For freight flows with Canada, trucks carried 56.0 percent of the $52.7 billion of the freight, followed by rail at 16.8%, pipelines at 10.8%, vessel at 5.5% and air at 4.5%. The surface transportation modes of truck, rail and pipeline carried 83.7% of the total U.S.-Canada freight flows. For freight flows with Mexico in June, trucks carried 66.8 % of the $40.8 billion of the freight, followed by rail at 14.5%, vessel at 11.7%, air at 3.2% and pipeline at 0.9% 3 In a study conducted by the Federal Government Trade Facilitation Committee, the following bottlenecks were identified as hindrances to effective trade facilitation in the country: acquisition of second hand trucks by operators; the use of rickety vehicles, lack of weigh bridges, overloading, speed violation, inadequate and poor road networks with virtually all port access roads in very bad conditions. It was also noted that port congestion over undue delay in port clearance, with most of the containers stocked at the ports running to several thousands contained imports and nothing much for export. It was estimated that only about 1.8% of containers that brought imported consignment go back with some exportable items; but almost 98% of such containers goes back empty. Proving that Nigeria at the moment, is a consumer nation with its large market in sub- Saharan Africa constituting the major destination for imports. ROAD CONDITION Despite the fact that Nigeria has the largest road network in West Africa and the second largest south of the Sahara, road network which accounts for 90% of mobility is not only weak but is made up of 194,200km with an estimated asset value of N4.567 trillion4 with only 60,068 km paved (including 1,194 km of expressways). Federal roads account only for 17.6% (34,120km) of the national road network. The State and rural roads respectively account for 15.7% (30,500km) and 66.7% (129,580km) of the total road network. Considering the huge land mass of the country at 923,766 square meter and a population of 167 million, Nigeria’s current road network is grossly inadequate if we truly desire to provide safe and sustainable transportation system that can support the growth of agriculture as a business in diversifying the country’s economy. When compared to other countries, Nigeria’s road density, is only about thirty sixth of USA, twenty fifth of China, seventeenth of India, ninths of Brazil and fifth of Russia. The World Bank says, Nigeria requires massive injection of at least $400billion10 for infrastructural development between now and year 2020 in order to achieve Vision 2020. The Honourable Minister of Works, Mike Onolememen, has also said Nigeria requires the sum of N2.3trillion ($14billion)5 for roads in realising the transformation agenda. The draft National Integrated Infrastructure Master Plan6 has projected that the country will require an investment outlay of about USD 265 billion over the next 30 years, for rehabilitation, expansion and upgrading of the Nigerian road network. This amount which excludes maintenance cost, would involve committing the sum of USD 20 billion on roads within the next five years. The planned investment in Roads does not appear to include the rural roads which are critical to evaluating farm produce. The last known attempt under the Directorate of Food, Road and Rural infrastructure to include a rural road component failed to achieve its objective due to policy somersaults and weak execution. Therefore any attempt to grow the agricultural sector must include deliberate investment in rural roads, which constitute 66.7% of the country’s road infrastructure by providing incentives to the state governments for deliberate construction of rural roads. Limiting the rehabilitation of roads mainly to the federal and states roads may not provide the desired effects. GOING FORWARD Going forward will require the inclusion of transportation in the Agriculture financing Strategy. This is key as the absence of organized end users like the oil industry majors will make it difficult if not impossible to access financing for the dry goods segment of the tracking industry. Rebuilding our Rail tracks and investing in new tracks that reflect the current production geography is critical to absorbing the anticipated growth in Agriculture output. The current Inland waterways strategy of this administration lends itself to be harnessed for food transportation. Providing low cost funding for Barges and flat bottom vessels will definitely open up new opportunities and employment in the internal maritime industry. Luckily our Inland waterways navigate through the food production areas of our country. An FRSC proposed fleet Acquisition and Renewal Scheme can be fine-tuned to enable a low cost financing model for Agriculture haulage operators. In adopting the Fleet Acquisition and Renewal Scheme, the issue of safe and sustainable transportation can be addressed through holding the operators to maintain minimum standards as a condition for accessing the scheme and maintaining their status under the scheme. The minimum standards include vehicle road-worthiness, trained and certified drivers and modern fleet management tools. Emphasizing the Federal Government’s planned investment in Road Construction without commensurate attention to rural roads will impede the hope for access to farm produce. Developing a clear strategy for engaging the states and local governments to improve rural access is critical to realizing our national goals. Transport and transport infrastructure as derived demands is never an end to itself. It creates access, promotes economic opportunity and expands markets beyond geographical constraints. Our current focus on Agriculture must be accompanied by a coherent transport strategy that will drive our planned growth in output. Thank you References 1. Nigeria Vision 2020:2020 document 2. National Integrated Infrastructure Master Plan, 2013 3. usnafta.org 4. FMW/FERMA/RSDT (2010) 5. Vanguard Newspaper June 17, 2013 6. National Integrated Infrastructure Master Plan, 2013
Posted on: Wed, 04 Sep 2013 08:43:30 +0000
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