King’s College old boy, OLADIPO AKINWALE LAWANSON, is Lagos State Honourable Commissioner for Transportation. His interview with this newspaper was scheduled to take place a few months ago, but for his busy schedule since he assumed office. And when it eventually happened penultimate week, in his office at the sprawling Lagos Secretariat, Alausa, Ikeja, he told business a.m.’s PHIlLIP ISAKPA and MOSES OBAJEMU, that the investment needed to solve the transport problem of Lagos requires every hand to be on deck, especially the hand of the Federal Government, with the support of the private sector. He also said a lot has been done and is still being done by the Lagos State government to ensure that the transport challenges of Lagos are eased for the benefit of the people, the state and Nigeria as a whole. Following are excerpts.
PHOTO CREDIT: JAYEOLA ISAAC
Thank you for this opportunity to meet with you and share insights into what has been going on in the transport sector in Lagos state. Let us start by having you give us a general overview of what the state of transport is in Lagos today?
Basically, Lagos State, as we all know, used to be the political capital, as well as economic capital. The political capital has been taken to Abuja, but the economic part of it remains here; and over the years, Lagos has grown in leaps and bounds. From a population of fewer than three million at independence, to about seven times that number, an estimated 23 million right now. As the population has grown, we have been confronted with many challenges that the increase in population has brought upon us.
For example, take the logistics landscape of Lagos; we had Apapa Port and later on Tin Can Port. The inflow into the country from the ports has also increased exponentially, from serving under three million people to serving 23 million people, there has not been a corresponding increase in infrastructure around the port to help distribute the logistics, both human and cargo. When you add that to the fact that Lagos is the most active port city in Nigeria; catering for two-thirds of all import into Nigeria, so you can imagine the amount of pressure that we put on our roads, on our ports and on the infrastructure around Lagos. It has created a huge challenge and our inability to address it incrementally over time, is what has resulted in the gridlock we are seeing everywhere. This is inevitable; it is the same thing with the human body. If you have a certain amount of blood that should pass through your veins and you increase it 10 times without increasing the distribution spread, after a while there will be too much trying to pass through too little space, there’s bound to be a haemorrhage, and that is what we are confronted with today.
Transport is key to any economy, anywhere in the world and Lagos is the economic capital of Nigeria; but it doesn’t seem to have adequate transportation infrastructure as you’ve accepted, so how is the state government working to see that this inadequacy is corrected?
It is two-fold. The state government has its responsibility to do its best to meet these challenges, but like I said earlier, because Lagos caters for not only Lagos but Nigeria, it is something that is beyond the resources of the state, nor should it be the sole responsibility of the state government. Let me use a world capital for example. London has a lot of similarities with Lagos, London is the capital of the United Kingdom, London houses the stock exchange like Lagos does for Nigeria, there are a lot of parallels between London and Lagos.
I once asked a member of the City Council in London, someone who had oversight on the transportation system: “How did you do it here?” What he said to me is that the United Kingdom recognises the role that London plays in its economy, in terms of the fact that London is the clearing house for all financial transactions, just like we have in Lagos; and London houses most of the capitals of the major companies, just like Lagos too. London has a port, just like Lagos; houses the stock exchange like Lagos and it is the economic capital of the United Kingdom and for most of Europe. So in the course of that, when there is infrastructure spend or heavy investment required to make the city work, the federal government commits between 40-50 percent. The thinking is that if London is working, the investments benefits the whole country in a trickle-down effect. It is necessary to give Lagos a special status and targeted federal government infrastructure investment support for the prominent role she plays in the economic development of Nigeria. For instance, at least between 60-70 percent of VAT comes from Lagos; there is no reason why a significant portion of that should not go into maintaining the infrastructure of the state that brings in the revenue for Nigeria. With the pressure the ports put on Lagos roads, there is no reason we should not take a component of the revenue to maintain the infrastructure, but we have not done that over the years and that is what has resulted in the inconvenience we put Lagosians through on a daily basis.
As I said, the gargantuan amount of investment required cannot be borne by Lagos state government, nor should it be, because it is not only Lagos that is putting pressure on those facilities. I think the federal government, and Nigeria as a whole, needs to recognise the important role that Lagos plays. For example, I hope you are aware that most of the petroleum products that we use across Nigeria originate from Lagos; we have at least 60 tank farms in Lagos, so if Lagos was to say, “we don’t want to do tank farms today”, the Nigerian economy will come to a halt, and if something goes wrong in that axis, the whole of Lagos will be on fire. Imagine having 60 tank farms in one location, we need the corresponding amount of investment in safety and logistics and Lagos cannot do it alone.
By your estimate, what is the size of investment, because it seems huge, that is required to have a good transportation network in Lagos?
I would not want to give it to you in terms of dollars and cents, but let us do a comparison between where we are at now, and where other cities of the world are and what they have done. For example, let’s take a city like Beijing in China, which has a population of about 21.5 million, they have good investment in metro, which is rail, in bus, to the extent that on the trains, they have a ridership of 13.5 million out of a population of 21.5 million, that is more than 50 percent through rail; and another 9.6 million through buses, which means if you add the 13.5 and 9.6, that is more than 21 million already, which goes to show that they have made enough investment in public transportation to serve their population.
Let’s take another city, Guangzhou in China, they also have a similar population to Lagos, they have 21 million. Ridership on the metro is 7.7 million, ridership on the bus is 4.8 million, so together they have about 12 million serving 21 million population.The case of London is also relevant. London has nine million population, less than half of what we have, they have ridership on the rail of five million and ridership on the bus of up to six million, which is a total of 11 million already. New York has 8.6 million population, ridership on the train of 5.5, ridership on bus, 2.5, and that is eight million, right there.
Lagos has 23 million people; ridership on rail is not enough to even chart it as a factor in terms of efficient mobility; bus which is the dominant mode is largely informal, but the good news is that in Lagos state, since 1999, we have achieved significant progress. During Asiwaju Bola Tinubu’s time, there were investment in transportation infrastructure through the introduction of the BRT system, and in Governor Fashola’s time, this was improved upon. The Bus reform initiative under the Ambode government is indicative of further progress. We have now moved from being an operator to being a regulator and an enabler in the transportation sector. The BRT system has been expanded through the procurement of 820 buses in addition to what was on the ground before, which the governor intends to launch soon. There have also been investments in rail as the first phase of the blue line construction will be completed soon.
The summary is just to say that we need to do a lot more investment in the transportation sector especially from the federal government and the private sector. This is because public transportation is not very profitable, it needs a function of subsidy, but subsidy not in the sense that it is a loss, it is not only financially viable but it is economically viable.
Let me explain the difference between financial and economic viability. The amount of money spent on road maintenance can be reduced if you transfer pressure to the water for example, because the road construction is done to cater for 4-5 tonne vehicles, but then we put 30 tonnes on it; so clearly, in a short period of time, there is wear and tear, thus we have to keep spending huge amounts of money. But if we develop the water front for example, if we dredge it, it is actually more economically viable to transfer huge cargo with a lot of weight through the water; that is why a lot of cargos around the world move through ships anyway, that is the most economically viable way of transferring huge cargo and as it is across oceans, it is how it will be in inland water ways.
So, for example, I see no reason why the petrol station owner in Epe, has to use a 30 tonne truck, running on our asphalts, spoiling it, to go all the way to Apapa, it will pass through about seven local governments, Epe, Ibeju Lekki, Victoria Island, Lagos Island, Lagos Mainland and Surulere before it gets to Apapa and then goes back again, when Apapa has a water body that stretches as far as Epe. What I am saying is we need to rework the logistics landscape of Lagos, we need to build mini receptacles in places like Epe, Badagry and Apapa axis, so that through small to medium size barges we can take petroleum products and have a storage in Epe, which will serve filling stations all the way down to Eleganza, Jakande area, so they don’t have to come through Lagos, and that is what causes the gridlock you see every morning.
People are moving to Lagos central from the different parts of the city, we have to decentralise services and economic activities, so the person in VI should head that way, it distributes the traffic away and there will be less traffic, so Epe should feed that side, and Badagry should feed as far as Orile; they should stop heading this way so that we would stop having the parking on the bridges.
In the transport architecture of Lagos, over time, we have heard of different combinations, there was a time there were talks about an intermodal system, can you bring us to speed on how Lagos has managed with that and why has it been slow, especially with waterway transportation and rail, everything seems to be pressured on the road?
Over the years, our major concentration has been on roads, we built Eko Bridge, Carter Bridge, we’ve built the Third Mainland Bridge, now we are thinking of the Fourth Mainland Bridge, so much emphasis on roads. We have not been creative enough in harnessing the provision and blessings of nature. Look at Lagos, at least a third or quarter of Lagos is water body, it is a natural God-given asset that we should harness and optimally use to solve our congestion problems, but the challenge with water transportation in Lagos is that the amount of investment required to do water transportation is a lot. We have to provide the jetties and vessels, we need to dredge the water channels, we need to keep the waterways clean, and we need to remove the wrecks which are potentially hazardous.
These wrecks need to be flagged and the process of removing them is very expensive and a bit complicated. The dredging of the waterways also requires a huge investment, as well as funding for the procurement of the craft for both passenger and cargo. It is a lot of money but it is the kind of money we have to look for because between the Lagos State Government and the Federal Government, and then inviting the private sector into it, the political will is what is most important and the commitment from decision makers, both at state and federal levels, to get it done. The private sector is also important because waterways may make short-term financial sense for investment, but it makes economic sense in the sense that the captains of industry must see that for the most valuable assets that they have, that is the human resources, to spend two hours or two and a half hours each way, which is five hours a day is a loss of productivity. So, it is a roundtable discussion that government has to initiate and bring the private sector decision makers to understand, that if they were to develop water transportation, they would cut those five hours by 60 percent from one end of Lagos to the centre, where everybody moves to.
Travel time from any part of Lagos through the waterways is not more than 50 minutes. I am talking about from the farthest point, from Badagry to Lagos, is not more than 50 minutes; so, if we were to invest in developing the waterways, most of the staff buses that go to Epe and Ikeja from head offices in Lagos island don’t need to do that, most of the long hauls can be done by water and the staff buses can move from the jetties to the head offices in the sense of last mile travel, so it is something we need to sit down and put a team of both private and public sectors together to work out and find investors and invest; so, if you can work two extra hours, it will have a positive effect on the balance sheet of the company and it also has benefits for them health-wise, they live longer and there is less pressure on our roads, that is why I say it makes economic sense. Furthermore, water transportation is a more environmentally responsible method of commuting
How much of Federal Government’s involvement would you like to see? Would you support a Marshall Plan action by the Federal Government, especially with regards to some major projects, for instance, the Lagos-Badagry expressway project, which could have also served in the same way that the Lekki-Epe corridor now serves; so how do you want the federal government to intervene with regards to the transport situation in Lagos?
You have said a Marshall plan; we need something that brings about the kind of commitment and will that such intervention brings to the economy. As I said, it has to be private sector driven because most development comes from the private sector, but the government has to lead the way, government has to bring all the stakeholders to the table and show how the manpower lost in the traffics can be turned to profitability, government also has to lead the way by opening doors to international financing that is not expensive. For example, there is a new climate bond, water transportation, for example, will tick a lot of boxes because there is a reduction in carbon footprints by using water transportation as opposed to road transportation. So, government has to lead the way and the private sector comes in getting the quantum and mixture of investment required to fund an expensive sector like logistics and transportation.
You are on the side of government, so when you say “government”, the public will want to hear you say “this is what we have done in the past few years”, so speak to us as someone on the side of the government, how this administration, which you are part of has been able to work with the Federal Government in trying to resolve some of the challenges you talked about?
I think that is a fair question. I will tell you that less than two months after I came on board as commissioner, we put together a think tank to see how we can learn from what has been done by the state government already towards unlocking the potentials of the waterways. We studied some reports and in two months we came back with what the state government has adopted, the Lagos State Water Transportation Agenda for this administration. Shortly after, we obtained the buy-in and commitment of the governor, the Ministry of Transportation convened a water transportation roundtable along the lines of what I am suggesting today. We had one at Eko Hotel, where we brought in potential partners – both local and international. The major consulates – US, British, Dutch, Germans – were represented. In fact, a powerful delegation led by the South African ambassador to Nigeria was also present to show their serious interest in the sector. This ministry under my leadership made all of that happen with the active support and endorsement of the governor. We identified the issues we had, some of which I have spoken about, and at that point, most of the countries and missions who were present, made a commitment to support our water transportation agenda. As I speak with you, the World Bank has also made a commitment to support the transportation agenda especially in the area of finance. But like I said there is only so much that the Lagos State government can do. For some of the international funding opportunities, the federal government has to be the driving force.
We have a water transportation agenda, we have spoken to the stakeholders, we have identified the issues and we have an implementation plan that Lagos State government developed, so what is the next step? There are on-going discussion about how to implement this agenda and in the process of the discussion, we have been able to realise that one of the first things we needed to do, to operationalize the plan, was to make sure that the waterways were cleaned in a consistent and sustainable manner.
To kickstart this effort, the ministry of transportation reached out to the private sector, to companies like Coca Cola, Nestle, 7Up, Guinness, under the aegis of the consortium called the Food Beverage Recycle Alliance. This is a corporate social responsibility initiative that we keyed into because we went after them and not the other way round. As I am talking to you now, we have signed an agreement with them for the initial three years and they have procured the equipment that they need to clean up our waterways. On our own part, we will coordinate the process and evacuate from what they’ve put on the shore through the ministry of environment. So, before the end of this administration, it is going to kick off. That is the sort of public sector-private sector collaboration that I am talking about.
The second step is the removal of the wrecks and the third step is the investment for the dredging of the waterways; the fourth step, which is currently on-going is the upgrading and construction of jetties; the fifth step is the investment in the craft to move both the passengers and the cargo, and the sixth step is the sustainability plan, safety and security of the waterways because. With the vulnerability of water transportation and acknowledgement of all that can go wrong, we are committed to prioritising health, safety and security with a world class approach that ensures that both commuters and cargo are transported safety and securely and that reach their destination.
It is true that government, especially in Nigeria, cannot fund transportation alone; you’ve talked about having the private sector come in, can you outline the areas you see the private sector coming in, and secondly, can you speak to the incentive environment that you have created to make it lucrative for them to come in, because you spoke of it not being financially viable but economical so?
For example, if we were to use the role that government plays in the road mode, government is responsible for the construction and maintenance of the road, but government is not responsible for paying for every single car on the road, so the same thing that applies there, since most of these companies invest in staff buses to move their people, we can encourage them to invest in boats, so that we can have more private cars off the road. For example, if you go to Marina, in the morning, everyone is going to Marina, but if you just drop to Apongbon, you will see UBA building, just go along that coastline to Bonny Camp and Ozumba Mbadiwe, that is where most of the single occupant cars go to and that is where we have to go to solve the problem. If you go to UBA building alone, you find hundreds of cars parked in the car park across the street and those are the cars you need to take off the roads. There is no reason why UBA, for example, can’t get a ferry that can take about 200-300 people and deploy them after studying the residential habits of their staff to know which of them are close to the water in areas like Ikorodu, Festac and Lekki and can be ferried to the office, the water line is just there across the road, we just need to rework how we have been doing things in the past, facing the reality we have.
Most of the friends and relatives we have abroad don’t take their cars to work, at best they take them and park them two streets away from the station and take the train to the city, that is what developed cities do and that is what we need to start looking at do; we need to invest in water transportation, it is not financially profitable in the short-term, but it is economically profitable because the companies should be responsible enough to care about the health of their most important assets, which is human resources, and we all know the amount of pressure that sitting in traffic does to our health in Lagos. Responsible employers should be interested in the health of their employees because when you are healthier, that is when you would be able to contribute more to the bottom-line of the company. From all the research available, I do realise that there has to be some element of subsidy, so I think there needs to be government leading the way with some kind of transportation stabilisation fund. Lagos state has been more creative than any other state; we have a security trust fund to empower the police and other agencies, so we would create something similar for the transportation sector
From the research we have done, in all those cities I earlier spoke about, revenues from ridership accounts for 50-70 percent, while the difference is gotten from taxes, but we can be creative about it and smart about how we make more money. For instance, advertisement on the waterways, it could be unlocked; but as I said, revenue from the access that Lagos state contributes, like the ports, there should be derivation of that to help support deployment of the waterways. By that we would have a healthier population and then, a more robust economy.
At Oworonshoki, there appeared to be some sand filling, but activities have stopped. On the other side of it, which is Makoko, I think there is a jetty but still covered up and not in use, at Mile 2, there is a jetty and I could remember in the 90s they were in use, what have you done to ensure that there is a lot of activities around the waterways?
If you listen to traffic radio, you would have heard that the governor has said that the jetty in Bariga is now available for use. Commuters from that axis are free to use the facilities in the jetty.
It needs to be a holistic approach, the private sector and public sector coming together to create the stabilisation for the water transportation sector. For example, how did the buses work in London? From my engagement with the head of Transport in that city, what they do is, they send out tenders, people tender for different routes, so when I give it to you, you would tender at a price, so whatever is the shortfall between the ridership and what it takes you to make it profitable and sustainable, the government pays for it either through a fund or tax, that is the sort of approach that makes whatever intervention you do sustainable.
Many of the current operators/ investors in the sector are struggling, they often cut corners because they cannot break-even; that is why I keep saying that it is a public and private sector commitment, with the right political will coming from both the state and the federal government to make it work. On our part in Lagos state, we have done all the groundwork, we have all the information, we are ready to engage with the federal government and we hope they will come with an open mind and with a positive attitude to grant to Lagos the sort of support that Lagos needs to be able to continue to play the role that she plays.
Lagos is a megacity, but what we see here is that the waterways are underutilised, most people do not take that route because most of the ferries and boats are either old or haphazard to take, that is why people prefer the road option, you earlier said that the state government is an enabler, trying to encourage the private sector, what role is your ministry playing in this direction to ensure that people who want to participate can come in?
Since I became commissioner, I told you we have convened the water transportation roundtable, which was to bring all the stakeholders together. This was the first step. While having that engagement, all of us identified what the issues are and we also delineated who plays what role, what the role of the government is and all. We invited all the foreign missions and even as a consequence of that, the World Bank was brought to the table and they’ve committed to support our efforts. Now, we have done all the baseline work that needs to be done to sensitize and encourage the operators to come. At this ministry, we have also invited the Food and Beverage Recycle Alliance and they would clean up our waterways; the initial 3-year phase is going to start. This ministry did that. The next phase is the removal of wrecks, which is a little bit complicated because the law says that whatever is under the wreck belongs to NPA, so there needs to be cross-government collaboration and I am glad to report to you that the new chairman of National Inland Waterways Authority (NIWA) has met with the governor, myself and other agencies involved and we are starting to form a closer bond of collaboration than what used to obtain in the past. So, that is happening already, and once that happens and we have an MOU, we will tackle the issue of the wreck as collaborators. That confidence-building was initiated by this ministry.
The third leg now will be to evaluate the state of all the jetties in the state, which one needs to be upgraded; so, what is our plan, what are the main jetties we are going to start with? Then the fourth leg is to help the local operators to access finance because they are the ones who have been braving impossible odds and have still stayed there, so what we would do is to help them access finance and put a structure in place that will be realistic for them to repay and stay profitable, that is where the transportation stabilisation fund comes into play.
But we can only start the conversation, we would need the help of the federal government because, in all international transactions, there is something called sovereign guarantee, and so the federal government needs to bring that sovereignty to the table, that is what the World Bank and other countries will respect. Lagos State cannot negotiate international treaties outside the federal government, especially when it has to do with funding.
We will also have to work with the local financial institutions. So, if you buy a ticket for N1000, the N600 that should be for repayment goes to the lenders, so that we don’t make the operators collect the money and convert it to do another business, which is what kills a lot of initiatives. So, all of these cross-jurisdictional collaborations and even cross-sectorial collaboration and public-private collaboration have to come together to give us that solution, otherwise it will just be a story of what happened in the past, where you will see some new boats coming in and after a while, the odds are overwhelming and they are not breaking even, they start to use less fuel, they try and use second-hand parts, then it breaks down. We have to fund it properly and give it a sustainability plan.
Also, what we have tried to do with the potential boat manufacturing companies, knowing the unemployment issues we have in the country, we made it clear to them that if we are going to buy 500 or 1000 boats, we are only going to procure the first 20 from you, and you will have to set up a plant here to build the boats and transfer knowledge and engage our people as part of the production process, so that every time we have a breakdown, we don’t have to fly somebody down or take the parts abroad, so those are all the value chain that we have to create and harness to have the desired outcome and maximum impact for our people.
Under your bus reform project, it was stated that some of these buses would be assembled here locally in due course, how far have you gone with that and do you think it will be sustainable because the new government will assume office in May, will they continue with that policy?
First of all, the first part of what you said is correct, the 820 buses are here and the bus operating companies have setup maintenance yards for them. A major maintenance facility and depot has been set up in Oshodi. There is another one in the Ajah axis, they are ready. We learnt a lot from the former LAGBUS which did not have a sustainability/maintenance plan – hence the quick deterioration of the buses. This time around we are putting the sustainability as an issue, so everything comes together; those workshops are here and will be run.
As to the continuity, from what we have heard from the incoming administration, I am talking specifically about the governor-elect and deputy governor-elect, they have said that it is the same government and they will ensure that all on-going projects are completed. And I can tell you that they have been actively engaging heads of ministries and agencies to understand the issues and proffer solutions. The work of the Transition committee is also relevant and means they are doing their homework and want to hit the ground running. So if I am to use my engagement with them to gauge their commitment, I will say that they want to hit the ground running and inevitably preparation is what leads to success, so I am optimistic.
Let’s try and round this up. First of all is the project at Oshodi, then linking it to the one that leads straight to the international airport. We heard it will be commissioned before the end of this term, what is the state of these projects?
I can confirm to you that this governor is determined to commission the Oshodi interchange, which is a major transportation asset to the state. For the first time we are putting world class bus service within the reach of the average person. I remember the time President Buhari came to commission the bus terminal at Ikeja, there were a lot of criticism in the media. The fact is that the bus terminal in Ikeja alone will process up to a quarter of a million people, so the project is one which affects the average Lagosian. And going back to the Oshodi interchange, it has three terminals, Oshodi terminal is going to process almost up to a million people a day and these people are average Nigerians, so that is the difference between this project and some of the other ones that we’ve been celebrating. It is a major infrastructure asset for the state.
The state airport road was disheartening for me as a Lagosian to see that the entry point into my city was in the state it has been. Even when visiting smaller cities in Africa than Lagos, the approach to their cities which is the first impression that a stranger coming into our city is usually quite impressive. If you are bringing investment somewhere and the way to the place you are going is filled with potholes, how encouraged will you be to say my money will do well here? It is also disheartening for the rest of Nigeria not to understand the role that Lagos plays and that approach should have been given priority all these years! But thankfully the Lagos state government has seen that and it has been done, and from the latest briefing I have, the governor is committed to commission it before the end of his tenure in office.
Going forward, how do you see the future for transport in Lagos?
I am optimistic from my engagement with the incoming administration, there is a sincere effort to understand the problems and the gravity of the challenge we are confronted with. The signs are encouraging and the governor elect and deputy governor elect who have been in the system before have the capacity to engender real change by attracting the sort of investment that we need in Lagos. But I must always add that beyond that, for Lagos to take its place as the fifth largest economy in Africa, Lagos alone is bigger than at least 51 African countries, I think it is necessary to leverage our God given assets – both human and natural – and in that for everybody’s sake.
Frontpage February 20, 2019