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The relevance of a Hub Center port to the economic growth of ECOWAS subregion. Apapa as a case study.

Abstract

This study was on the relevance of a hub center port to the economic growth of ECOAS subregion. A case study of Apapa port. The objectives of the study are: To find whether Apapa port is a hub center port to the growth of ECOWAS, to examine ways of integrating the national multi-modal links into the port system and to find out the requirement to hub center port in ECOWAS. The study looks at the requirements to make a port a hub center port. The study recommended the integration of pertinent national economic and industrial interests in port development, through the creation of a dynamic port community is also a prerequisite for becoming a customer-oriented port. It is inevitable that the port will have to encourage private participation, and in some cases, outright privatisation of some of its activities.

Chapter one

Introduction

1.1Background of the study

Management of shipping and port activities have been greatly influenced by globalization. The globalization of the world market and tougher international competition and expansion of geographical markets have forced manufacturers to focus on integrated production and transport service standards

Seen from this perspective, a port’s role should be to rise to the occasion by attempting to satisfy the demands placed upon it by the shipping industry. Consequently, recent developments in the port industry have been largely due to the chain reactions of changes in world trade, and technological advancements that impacted on the shipping industry. Generally tagged globalization, this phenomenon refers to the global sourcing, manufacturing and selling of products, which enhances the acceleration of trade across international boundaries. The concept implies the need for global logistics, which, De Monie (1997 p.2) observed, is demand derived from the globalization of the supply and demand side

Thus, liner shipping will still be characterised by: Take-overs/mergers and alliances into new multinational transport companies acting as logistic providers. Major carriers will lead to a further increase in the number and increasing the size of vessels deployed. The need for major container carriers to upgrade their organisation to offer customer global logistic packages.

The consequences of these are the development of ports and terminals to be able to meet these demands of the liner shipping industry. Port management needs to be flexible, pro-active, autonomous and accountable for its operational and financial performance. Ports will therefore have to re-organise their operations and accept the demands of container services by striving to shorten transit times of containers (by offering the most direct route and maximising direct calls). The aim of this is to reduce the number of ports of call by covering the different sub-regions through a network of feeder services.

Thus, the future of most ports in the world would be centred on developing into any one of the following: Local feeder hubs, Regional feeder hubs, Sub-regional feeder hubs, Pure logistic hubs Ports need to be market places in which international market forces interact with national economies and are able to provide an environment in which the public sector can cope with the provisions. In order for government to be able to meet these challenges, they need to take advantage of opportunities created by international trade/technological advancement, to improve on the level of social and economic development of their countries.

Today, there is convincing evidence that with the economic policy reform in most countries in the West African sub-region, where GDP growth rates are over 5% (SSATP No. 30, 97, 21), they can compete favourably in international maritime transport. GDP improved in Cote d’Ivoire to nearly 7% in 1995 while Ghana, experienced a growth rate of about 6% (SSATP No. 30. 97, 36). The most important step is for countries to move from a no-growth or slow-growth to sustained rapid growth. This will ensure an enabling environment in order to exploit the opportunities at hand. Most governments in the sub-region are therefore adopting policies that will improve their ports to meet international standards, cut down on the cost of maritime transport and be competitive. Unfortunately, the present ports in the sub-region are not equipped adequately to meet these technological changes in the maritime industry. The ports need to be developed so that they can meet the current technological developments in the maritime industry. This will involve huge investments in the following areas: Expand infrastructure and superstructure, Improve productivity, Improve communications, Offer more attractive financial packages/concessions, Lower handling rates, Port reforms such as institutional reforms and improved labour practices, Improve intermodal or feeder connections, Spread risk by investing in other ports and terminals operations. In response to the above demands, all the major ports in the sub-region are also embarking on different types of programmes to improve the infrastructure and efficiency. Notably among them are Ports of Abidjan (Còte d’Ivoire), Tema (Ghana), Dakar (Gambia), Apapa Lagos (Nigeria), Cotonou (Benin), Douala (Cameroon) etc.

Furthermore, ports need to focus on strategic issues that will save the cost of investment. These issues were reiterated by the Minister of Roads and Transport during the ECOWAS Trade Fair in Ghana in Febuary,1999 as: “The countries in the sub-region need to develop consensus on our major ports, which are likely to develop into hub port status whilst the minor ones are made feeder port. This is important in order to save cost in the development of maritime transport in the region

1.2 Statement of the problem

The attractive to ports are the large capacity container ships that are a potential source of revenue. Such ships however require that the port be efficient, meaning that the port should have the capacity to berth the vessels, ensure shorter turn-round times, provide efficient documentation, information technology, cargo-handling capability and provide large quantities of cargo besides other facilities. Though in terms of the magnitude of container traffic, the developing regions of Africa cannot be compared to the aforementioned regions, the development of Hub and Load Centre operations, as opposed to the development of pure logistic hubs may seem inevitable. ECOWAS is not left out this competition for the attainment of hub status is manifest as in the case of Nigeria, in feeble and uncoordinated attempts at structural and administrative adjustments in the ports. Based on this the researcher wants to investigate the relevance of a hub center port to the economic growth of ECOWAS subregion. Using Apapa port as a case study

1.3Objective of the study

The objectives of the study are;

  1. To find whether Apapa port is a hub center port to the growth of ECOWAS
  2. To examine ways of integrating the national multi-modal links into the port system.
  3. To find out the requirement to hub center port in ECOWAS

1.4 Research question

  1. Is Apapa port is a hub center port to the growth of ECOWAS?
  2. Are there ways of integrating the national multi-modal links into the port system?
  3. Is there requirement to hub center port in ECOWAS?

1.5Research hypotheses

The following have been put forward for testing

H0: Apapa port is not a hub center port to the growth of ECOWAS

H1:  Apapa port is a hub center port to the growth of ECOWAS

H0: there are no ways of integrating the national multi-modal links into the port system

H2: there are ways of integrating the national multi-modal links into the port system

H0: there is no requirement to hub center port in ECOWAS

H3: there is requirement to hub center port in ECOWAS

 1.6 Significance of the study

The study will be very significant to students and ministry of transportation and the policy makers. The study will give a clear insight on the relevance of a hub center port to the economic growth of ECOAS subregion. The study will give an insight what makes port a center port hub and whether Apapa port is up to that standard. The study will also serve as a reference to other researcher that will embark on the related topic

1.6 Scope and limitation of the study

The scope of the study covers the relevance of a hub center port to the economic growth of ECOAS subregion. The researcher encounters some constraints which limit the scope of the study namely:

The research material available to the researcher is insufficient, thereby limiting the study

The time frame allocated to the study does not enhance wider coverage as the researcher has to combine other academic activities and examinations with the study.

Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).

 1.7 Definition of terms

Hub center: hub-centric, meaning the large hole in the middle of the rim is the exact fit for the hub on the vehicle, and lug-centric, which means the centre hole is oversized to fit a variety of vehicles.

Port: A port is a maritime facility which may comprise one or more wharves where ships may dock to load and discharge passengers and cargo.

Economic growth: Economic growth is an increase in the production of economic goods and services, compared from one period of time to another. It can be measured in nominal or real (adjusted for inflation) terms.

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